President Obama is definitely on to something with his push for more manufacturing in America, an initiative he announced during his visit to General Electric in Schenectady last year. The country needs more jobs of all kinds, but particularly manufacturing ones, which tend to be higher paying and require less higher education.
The United States has lost 2.1 million manufacturing jobs since 2001, due to import competition and companies shifting production abroad to take advantage of cheap labor. Now for various reasons, including rising labor costs in the Third World and political unrest, some have come back and others are considering it, and Obama wants to encourage them with tax incentives. Closing loopholes that allow them to shelter overseas profits would be better, because it could have the same effect without the revenue loss to the Treasury.
Obama’s initiative asks companies like GE to create more domestic jobs, and last year he appointed its CEO, Jeffrey Immelt, to head a new President’s Council on Jobs and Competitiveness. GE appears to be answering the call, announcing new manufacturing facilities like a solar panel plant in Colorado and aviation-related plants in Mississippi, Alabama and Ohio. Obama is counting on such good news to boost his chances in key industrial states like Ohio in November.
The loss of manufacturing jobs in the Midwest and Northeast, including New York, has been a big factor not only in the shrinkage of the middle class, but the growth of the underclass. After World War II, many blacks migrated from the South to the North for factory jobs that, with a high school education, allowed them to raise a family and even own a home. Now, that level of education is likely to get them a job serving hamburgers at a fast-food joint or swabbing floors at a hospital for minimum wage or close to it.
Which is what makes another Obama idea, more federal support for job training at community colleges and rewards for those with good placement records, so important. Some 2 million job openings in manufacturing are expected through 2018, mostly due to baby boomer retirement, and we are already beginning to see some growth there. But these types of jobs often require the ability to operate complicated machinery and follow detailed instructions, as well as some technical and mathematical knowledge. A community college is a good place for them to get such skills and knowledge.
And, of course, there’s nothing preventing companies from having their own internships or training programs, as GE will for the 2,500 engineering interns it plans to add and 5,000 veterans it plans to hire over the next five years. The company just announced that news last week.
A great country has to actually make things; you can’t just do deals, provide services and sell things that others make. Obama’s focus on manufacturing is welcome, as is the response of companies like GE.