Career Tips

Topic:  Manufacturing Jobs – Made in America

Seasoned manufacturing professionals are aware that the United States has not seen a boom in manufacturing jobs since the 1950’s and 1960’s.  When the current administration came into the White House, several things happened that made us all aware that the US is overall dependent on foreign manufacturers to supply Americans with medications and other essentials. For the past 36+ months, the US has had a revival of growth of manufacturing jobs – new jobs and jobs coming back to the US from other countries.  Some supply chains have been modified to compliment the new direction.  

Manufacturing professionals are asking, “Will the manufacturing job growth continue under a new president?”

Answer:  From a simple economics point of view, it is all about the math.  

If a new administration implements higher taxes and increased regulations for businesses, the likely results are as follows:

• Higher business taxes make US manufacturers less competitive with manufacturers producing the same product in other countries.  More regulations generally add to the cost of production.  The result is likely to be less cash flow and less capital expenditures, because of price pressures and potentially losing sales to foreign competitors who may be subject to fewer regulations or may receive subsidies from their respective governments.
• Lower sales and the associated cash flow pressures result in less funds available for hiring and capital projects, which impact vendor companies’ ability to hire workers.
• The simple math of higher production costs combined with price pressures is not conducive to increasing the number of manufacturing jobs in the US.

If a new administration continues policies that have encouraged the recent resurgence of manufacturing in the US, then manufacturing organizations will find ways to be productive and grow.  If more favorable policies are implemented, US manufacturers will see better cash flow and will look for ways to grow and to remain lean and flexible – including new capital investments and hiring.

New technologies are other potential variables for creating jobs in the US.  New battery technologies – away from lithium – and/or new hydrogen vehicles and planes can generate many new jobs, as long as the jobs are not outsourced to other countries.

In short, if the economic environment continues on a similar path, the math will help companies to continue to be competitive and grow their businesses which equals Jobs… Jobs… Jobs.  If there is a major change in the economic leadership and direction, leading to higher costs and increasing pressure on prices, there will be increased barriers to job creation.

No one has all of the right answers, but understanding some basic economics and the simple math required to balance a checkbook can help answer several parts of the manufacturing job growth question.