U.S. Manufacturing Hits a New Four-Year High

Evans Metal Die Manufacturing Growth

The manufacturing industry has fluctuated much like any market over the years, but currently the industry has seen substantial gains, hitting its highest level in nearly four years. According to a survey conducted by Markit, factory activity has expanded at its fastest pace in nearly four years as well, during February 2014. The stock market measured by the Dow Jones shows that the market has gained all of its losses from the crash of 2008, even after an unsteady start this year.

Additionally, claims for unemployment insurance have recently fallen as well, which is a good thing for the job market, as less people are getting laid off. Claims for unemployment insurance have fallen in the past weeks. The stock market pinpoints the previous industry weaknesses on the negative effects of the extremely cold weather and severe storms that the U.S. has been experiencing. Now, however, things are starting to improve.

In terms of statistics, the Dow Jones industrial average rose 92.67 points, or 0.58 percent, bringing it to 16,133.23. NASDAQ rose 29.59 points, or 0.7 percent, bringing it up to 4,267.55. The Standard & Poor’s 500 index added 11.03 points, or 0.60 percent, to end at 1,839.78.

The gradual strengthening of the U.S. economy obviously plays the largest role in helping the U.S. manufacturing industry. The creation of more jobs will allow the industry to continue to grow rather than slowly stagnate. While U.S. manufacturing will undoubtedly continue to see gains and losses, the fact that it’s currently stronger than ever is very uplifting and reassuring news.

More Minority Students are Getting Involved in STEM

STEM (science, technology, engineering and mathematics) education

STEM (science, technology, engineering and mathematics) education is highly important because it serves as a stepping stone to get students of all ages and races to prepare for careers in any one of those fields. An increasing emphasis has been placed on STEM education nationally in the last few years. The U.S. Department of Education says that only 16 percent of American high school seniors are proficient in math and interested in STEM careers. And of those who study those fields in college, only about half choose to work in such a career.

An organization called the Pennsylvania Mathematics, Engineering, Science Achievement (MESA), a division of MESA USA, which was founded in 1970, helps millions of low-income students get involved in STEM through challenging courses, mentors and training.

Hosted by Temple University in Philadelphia, the MESA initiative offers free Saturday classes, a two-week summer camp and support to after-school clubs in a variety of technology-based subjects. It focuses on African-American and Latino students who are underrepresented in high-paying STEM jobs.

Since the program’s launch in May 2011, it has served over 3,500 students in grades six through 12 in the School District of Philadelphia, including those in some of the district’s lowest-performing high schools. Recently, students in the program took home four team medals and 18 individual awards at the 2013 MESA USA National Engineering Championships.

Another program called the Logistics, Acquisitions & Supply System Operations (LASSO) is a two-week summer camp taught almost exclusively by Navy core officers. It builds on skills in math, Microsoft Excel, teamwork and problem solving. During the summer of 2013, the Navy contracted with Pennsylvania MESA to organize the camp in three other cities: Chicago, Baltimore and Newark. This summer, the program is planned to be conducted in 12 different cities.

The Promising Future of US Manufacturing

Metal Stamping in the USA

US Manufacturing is slowly but surely seeing a revival in terms of its job market. This is largely thanks to the decreasing energy costs in US along with growing labor costs in China. In fact, energy usage is equivalent to only about 17% of US gross domestic, while China’s energy usage equals about 27 percent. This decrease in energy costs is due in part to a rise in shale oil and natural gas exploration in the U.S. By 2015, prices for natural gas are expected to be 60 to 70 percent cheaper in the U.S. than in Japan or Europe. Electricity prices are also predicted to go down in the US, anywhere from 40 to 70 percent cheaper compared to other countries.

With this steady surge in the manufacturing industry, the US economy is seeing a modest recovery. Many types of companies in all different job markets are starting to add more employees to their payrolls, thus causing the unemployment rate to go down. These trends are only expected to continue in the years ahead, and as a matter of fact, manufacturing is predicted to remain a positive contributor to the economy in 2014. This is because consumers are expected to spend more on cars, appliances and durable goods, and businesses are likely to increase spending on new capital equipment.

A recent survey from the Institute for Supply Management (ISM) showed that its October ISM manufacturing index increased from 56.2 to 56.4 in September, which is the highest it’s been in over two years. This reading indicates that more manufacturers are reporting improving conditions for their companies, and therefore, many firms are seeing more long-term manufacturing conditions.

The US economy still has a long way to go in order to improve, but as of right now, conditions remain favorable for growth in 2014. Likewise, manufacturers will benefit from consumer demands and continue to strengthen in the imminent future.

After Manufacturing Day: Let’s Keep it Going

For those of us who participated in Manufacturing Day on October 4, it was an invaluable opportunity to reach out to our communities and the younger generations, and tell the story of manufacturing. It was a day to celebrate this great industry, while focusing on its future.

One of the main purposes of Manufacturing Day was to get younger people—those entering the workforce as well as those still in school—interested in careers in manufacturing. As American manufacturing continues to gain momentum, we are facing a skilled labor shortage, and companies are continuously in need of qualified workers.

Here are just some statistics*:

  • More than 70% of Americans view manufacturing as the most important industry for a strong economy and national security, yet only 17% named manufacturing as among their top industry choices to begin a career, and only 30% of parents said they would encourage their children to pursue careers in manufacturing.
  • By 2030, there will be twice as many retirees as there are today, but only 18% more workers.
  • 83% of U.S. manufacturers surveyed in 2005 for the National Association of Manufacturer’s Skill Gap Report indicated a shortage of skilled manpower, already affecting their ability to serve customers.

So what is the solution? Of course, this is not easy. But one way to look at it is to make every day Manufacturing Day. To consistently reach out to customers, students, teachers, our children, our peers, and showcase the value of what we make, what we do, and why it keeps America running.

According to this article written by Douglas Woods of AMT, “It’s important that we’re finding ways to share that passion [for manufacturing] with a broader audience, especially the younger generation – those who will carry our industry forward in the years to come.” He suggests a 365 day/year effort, including “industry-related events, coalitions, forums” such as conferences, workshops, and more.

Tackling such an overwhelming challenge isn’t easy—but this is American manufacturing. We are up for the challenge.

*Source: http://www.nutsandboltsfoundation.org/wp-content/uploads/EPK-Fact-Sheet-final.pdf

Robotics and Automation: The Next Big Industrial Revolution is Here and Now

Evans Arc Welding Robotic Assembly

It’s been 100 years since Henry Ford created the first manufacturing assembly line – he physically pulled a Model T on a rope! Ford’s assembly line helped to answer demand for the automobile, and it was one of the biggest breakthroughs in the industrial revolution, according to a recent article in the Detroit Free Press. The creation of assembly lines has had global ramifications over the past century, ramifications that have extended all the way to today.

robotThe article states, “When Ford pulled that first Model T on a rope, it was one of the biggest breakthroughs in America’s industrial revolution. Breaking down the Model T’s 3,000 parts into 84 distinct steps performed by groups of workers simplified and shortened the building of a car. Assembly time for a Model T went from 12 hours to about 90 minutes.” This assembly line was, literally, the grandfather of today’s manufacturing lines, and, just like that original assembly line, today’s automated manufacturing production lines offer a lot of advantages:

  • Simplification of an assembly/manufacturing process.
  • Higher production rates.
  • Time-savings.
  • Cost-savings, and more.

A recent article on USAToday.com says, “The savings achieved through the first assembly line enabled Ford to reduce the Model T price from $850 to less than $300, making it affordable for the masses. By 1927 Ford was able to build a Model T every 24 seconds and sold more than 15 million worldwide, accounting for half of all automobiles sold at the time.”

Today, automation, in various forms, is revolutionizing manufacturing in every sector. Manufacturing Engineering Media reports, “Although automation can and does take many forms, ranging from barfeeds and parts catchers to pick-and-place systems, and to floor, machine, or gantry-mounted robots, each type has its pros and cons.”

The pros of automation – such as filling the manufacturing skills gap, offering a high-level of accuracy, and taking humans out of dangerous environments and situations –definitely outweigh the cons. The same article states, “Small and midsized shops also have an opportunity to adopt automation as a ready-made and cost-effective solution to critical gaps in the availability of skilled workers for applications like welding, for instance.”

Fast-forward from 1913 to 2013, look at every manufacturing industry and you’ll see the legacy left behind by Henry Ford’s first assembly line. Today, however, you’ll find robotics and technology playing important roles on the assembly line. Automation is one of the keys to success – and to remaining competitive – in manufacturing on a global scale. Yes, we’ve come a long way from Ford’s days of pulling cars on ropes, and who knows where we’ll be 100 years from now!

What is New Manufacturing?

Manufacturing isn’t what it used to be. ‘New Manufacturing’ is much more advanced with highly trained technicians and engineers who are designing automated, robotic machinery instead of standing on assembly lines as they have done in the past. In addition to being more advanced, women are increasingly joining the manufacturing sector. Colleges that offer manufacturing coursework around the country are even being awarded grants in order to help boost manufacturing jobs in certain areas around the world.

Organizations like the National Science Foundation have awarded millions of dollars in grants to area colleges with the hopes of increasing enrollment in STEM related curriculums. A large part in gaining student interest in manufacturing is educating students on new manufacturing. Most view the industry as doing “dirty work”, when it has actually become a very skilled and high-tech career path with very educated people. Colleges and Universities around the United States are investing in new equipment and training labs for students in order to provide the best training and resources possible. Often times, professors have close ties with industry professionals, and are able to refer students to high-paying, big name organizations upon course completion.

The National Science Foundation gives educators and students a great opportunity to increase interests and learning capabilities that will essentially strengthen the manufacturing industry as a whole. As grants are awarded and new opportunities arise, there will be an increase in interest and job opportunities for manufacturing around the country.

American Manufacturing Keeps Moving Ahead

Metal Stamping in the USA

A recent survey on nearshoring showed that 18% more manufacturing executives would choose the US as their preferred location than only two years ago. The reasons for this are many, but one of the most attractive—and newsworthy—is that U.S. manufacturing costs are now equal to those of Mexico. Perhaps even more surprising and significant is that by 2015, U.S. manufacturing costs are predicted to be equal to China. These reports have a number of business owners asking, “why would I send my business overseas, when it costs the same to have it manufactured here at home?”

With these numbers coming in, the same survey revealed that in the next year, 84% of C-level executives will consider the decision to nearshore a major one. Furthermore, 58% of these surveyed executives stated that the business that they’ve already nearshored has saved them money.

These cost savings, or lack of savings by going overseas, are a part of what helped bring about America’s manufacturing renaissance. But that’s not all. Factors such as rising energy costs in other countries (while our energy costs are decreasing), increased focus on sustainability, higher logistics costs overseas, American technology innovations, and risks to the global supply chain have added to the return.

Five years ago it may have been hard for someone to believe that America would be as cost effective a place to manufacture as Mexico and China, but today, it’s reality. Add to that the fact that people are recognizing that American goods are higher quality, and it’s easy to see why this is the direction manufacturing has taken. It will be interesting to see where we are five years from now, won’t it?

Women in STEM Careers: Why the Disconnect?

STEM (science, technology, engineering and mathematics) education

With April being Mathematics Awareness Month—a celebration and appreciation of all things math—many people are focusing on it as a career path, and hoping this awareness will lead to young people pursuing careers in mathematics and science. Organizers are hoping they can place an emphasis on STEM (science, technology, engineering, and math) education and get the workforce of the future interested.

Following Women’s History Month (this past March), many people are also questioning why less and less young women are choosing to pursue STEM careers. As universities and researchers are finding, it is not because women are less qualified, nor is it because women are simply not as good at math and science as men are.

Rather interestingly, they’re finding just the opposite. After studying 1,490 high school seniors, then following up with them 15 years later, researchers at the University of Pittsburgh and the University of Michigan found that unlike many males, the females were equally good at both math and verbal skills, and were then choosing careers outside of STEM fields. This made them curious as to why, and what could be done to change that.

One idea was to refocus the perception and stereotypes associated with math. Changing the way of thinking that makes women think math-related fields are male dominated and not family-friendly. Showing young women the positive impact they can have on math and science, as well as the impact math and science can have on them. Providing them with positive female STEM role models and, in essence, shaking things up. They suggest that educators and employers can take part in this redirection and help bring more women into STEM roles, which would be mutually beneficial for both the women and the employers.

What do you think can be done?

Are you Ready for the ‘Manufacturing Homecoming’ That’s Happening in the U.S.? (We are!)

Recently, more and more companies across the nation are bringing their business back home to the U.S. instead of moving manufacturing jobs to international locales. We blogged about this “reshoring” trend last fall, and this year we’re seeing increased business directly related to the reshoring trend that’s continuing to happen.

According to recent reports, 2013 is being touted as the year where we can finally start celebrating the “manufacturing homecoming” that’s happening in the U.S. “The trend of companies relocating American manufacturing jobs to low-wage China has started to reverse,” says Hugh Welsh, DSM North America on BusinessInsider.com. The article outlines the key economic drivers that have contributed to this reversal, and that have created a competitive advantage for the U.S., including:

  • Cheap and abundant natural gas.
  • Innovation.
  • Rule of law.
  • Human capital.
  • De-complexity.
  • Public policy and abundance.

Credit, currency and the coming wave of mergers and acquisitions.
Welsh adds, “The new era of manufacturing in the U.S. to serve U.S. markets is at hand, along with the growing export market for specialized, high-margin finished goods… The world has changed. The U.S. has changed, and the pace of this change accelerates every year.”

Is your company ready for the increased business the manufacturing homecoming will continue to bring to the U.S.? At Evans, we are ready (and we’re already rolling ahead with some exciting, new opportunities). Since 1948, we have offered metal stampings and tools and dies – and everything is manufactured right here in the resurging Southeast of the U.S.A. We provide high-quality products and services, lower costs, faster turnaround times and excellent customer service – something that’s difficult to find – all together – anywhere else in the world!