Manufacturing the Future: Driving Growth Through Advanced Manufacturing

by: Toni Verstandig and Thomas J. Duesterberg

Manufacturing today is no longer the dirty, dark, and dangerous world it may have been during the early years of American industry. Indeed, advanced manufacturing has the potential to symbolize the broader manufacturing resurgence underway in America as well as play a driving role in the country's overall economic recovery. A good deal of progress has been made in recent years in restoring global competitiveness, jobs, and excellence in innovation in this sector. Nevertheless, the full realization of that potential will depend on public-private and global collaboration to reinvigorate investment, to prepare an educated workforce, to encourage the development of regional clusters of excellence, and to promote macroeconomic growth.
That was the takeaway of an Aspen Institute panel discussion held in collaboration between the Institute's Manufacturing & Society in the 21st Century and Emirates-Aspen Program Innovation on what it will take to drive growth through advanced manufacturing in America. The panel discussion last week in Saratoga Springs, NY, featured David Chavern from the Chamber of Commerce, Johanna Duncan-Poitier from SUNY, Dan Hutcheson from VLSI Research, and Aric Newhouse from the National Association of Manufacturers and was held in partnership with GLOBALFOUNDRIES, a computer chip company that has built the world's most advanced semiconductor plant in the high-tech valley of upstate New York. GLOBALFOUNDRIES represents not only innovation in advanced technology but the new way of doing business in a global world.
The unique story of GLOBALFOUNDRIES, whose plant has emerged fully from a forest in less than five years thanks to sustained foreign investment from its parent company, the Advanced Technology Investment Company of the United Arab Emirates, underlined the discussion and provided a useful framework for the national and regional policy architecture that would help nurture the development of advanced manufacturing hubs throughout the country. Among the key points for driving growth in advanced manufacturing included:

• STEM Education: To maintain its technological edge on the global stage, the United States will need sustained and long-term investment in STEM education to encourage the youth of today and tomorrow to pursue the engineering, science, and computer science-driven careers that will be needed to fill jobs in America's manufacturing sector. The long-term timeframe must also be met with immediate STEM-career training initiatives to prepare workers to take the job openings in this field that currently sit unfilled. Attracting students to these fields and to careers in manufacturing also requires a more positive image of the sector and better collaboration between industry and educators.
• Tax Policy: An enabling tax environment would play a key role in encouraging American companies to bring manufacturing jobs back from overseas. Long-term tax reform is a high priority in this field, but short-term fixes such as reducing the corporate income tax rate to levels commensurate with industrial country averages would go a long way in jumpstarting growth.
• Foreign Investment: At a time when American companies are keeping a record amount of capital overseas, and when U.S. cost structures are becoming increasingly competitive, the interest of foreign investors in U.S. industries remains high. The US should leverage this interest and continue to develop incentives to attract foreign investors prepared to make large-scale capital investments in the United States.
• Infrastructure for Regional Hubs: Forward thinking investment in the infrastructure required by advanced manufacturing plants (water, electricity, and natural gas, as well as roads and airports) will go a long way toward encouraging the development of regional hubs for advanced manufacturing. The opportunity for high-tech plants to share in the established infrastructure of high-technology parks with other like-minded firms is a big incentive for capital investment. If you build it, they will come.
• Colocation of Research and Development with Production -- a growing body of evidence shows that the colocation of research and development with production is a key ingredient for technological innovation, especially in the high-tech sector. To keep its global competitive edge in advanced technology, the U.S. would benefit by keeping manufacturing in close proximity to research and development centers. In upstate New York, the combination of company research and collaboration with nearby universities (RPI and SUNY Albany), and with specialized research centers such as Sematech, the Global 450 Consortium, and the College of Nanoscale Science and Engineering help create a fertile environment for perfecting advanced technology.
• Partnerships: in the competitive global environment for manufacturing, a single company and, increasingly, no single nation can go it alone and expect to stay ahead. In New York, the combination of partnerships between companies, between educational institutions and companies, and between the public and private sectors -- is a key to the success of the8.5 billion GLOBALFOUNDRIES investment. This investment demonstrates the UAE's thought leadership and enduring partnership.

These are just a few of the many exciting ideas that were presented in the discussion. And, especially at a time when there is gridlock in Washington, we can expect many of them to be a heavy lift. However, with thoughtful collaboration from the public and private sectors, both at home and abroad, we can expect to make that lift a little bit lighter. With the incredible potential presented by advanced manufacturing, every option is worth the effort.