
MIT faculty see promise in American manufacturing - MaysonL
http://web.mit.edu/newsoffice/2012/manufacturing-pie-overview-0125.html
======
fennecfoxen
The public perception of a decline in American manufacturing is highly
overrated. It's American manufacturing _jobs_ that have been in decline.
American manufacturing itself has grown every year from 1970 to 2010 with
three exceptions (2001, 2008 and 2009, recession years).

(cf. also <http://goo.gl/ZA1o2> \- for the historical stats; the opinion parts
and any policy recommendations you can take or leave.)

~~~
learc83
Exactly, it's not foreign workers that have taken all the blue collar
manufacturing jobs, it's robots.

Everyone seems to be worried about China becoming the manufacturer for the
world, but as technology progresses manufacturing will move closer to the
consumer.

~~~
tmh88j
I'm an engineer in the manufacturing sector and there is quite a bit of
automation at the company I work for. Where there are robots, PLC's, and other
things that can be programmed there will ALWAYS be problems that need both
high tech people and blue-collar level involved. Engineers write the software,
technicians repair them and workers operate them. I don't get why people have
this notion that factories are comprised entirely of robots running at 100%
efficiency with 5 people overseeing what used to be 1000 jobs. A robot may
take someone's job and be able to perform the same amount as 3 people, but
it's not like they're free-standing things that require no maintenance or
other human interaction. In many instances it's just not feasible to have a
robot perform the work.

~~~
yardie
A major car manufacturer, BMW or Toyota I believe, was showing their new
factory and touting how it only required 50 people to run operations for the
entire factory. You underestimate the amount of labor a robot can replace.
It's not 3 people but 10. Now some of that labor will be pushed up to control
and maintenance but most will simply be phased out.

As well, new factories are being built around robots and their limited degrees
of freedom.

~~~
tmh88j
There aren't too many manufacturing facilities in the US of that size that are
automated to the extent you mentioned. There are many situations where it's
nearly impossible to have a robot do the job such as installing wiring
harnesses, installing hardware in very tight, awkward spaces, etc..(when I say
impossible I mean it would cost more to develop that job than the income it
generates). I've seen many cases where a human can do the job faster than a
robot too. Sure, improving object design can improve manufacturability, but
robots are not going to replace people entirely anytime soon in every type of
manufacturing.

------
bootload
_"... high-tech firms such as Dow Corning have kept significant amounts of
manufacturing in the country. ..."_

It was reported in the NYT article, _"How the U.S. Lost Out on iPhone Work"_
(Duhigg, BradSher) ~ [http://www.nytimes.com/2012/01/22/business/apple-
america-and...](http://www.nytimes.com/2012/01/22/business/apple-america-and-
a-squeezed-middle-class.html?_r=1&hp=&pagewanted=print) that Dow Corning lost
out on the touch-screen glass contract to a nationally backed Chinese firm.
[1]

Reference

[1] _"For years, cellphone makers had avoided using glass because it required
precision in cutting and grinding that was extremely difficult to achieve.
Apple had already selected an American company, Corning Inc... Then a bid for
the work arrived from a Chinese factory... The Chinese plant got the job."_

~~~
flybrand
Fair point, but saying that Dow Corning is not high-tech because it did not
win the Apple iPhone business is akin to saying Foursquare is not 'high-tech'
since FB also does location based services.

The NYT article does not give any detail on that specific contract, margins
paid, etc. There are many reasons DC might not have that specific business but
that doesn't detract from the sophistication of their current mftg or its
location in the US.

I work in mftg and many of the branded, PR-heavy products are actually pretty
poor decisions from an economic standpoint - think of Andrioid's market share
compared to Apple's profit-share.

~~~
bootload
_"... saying that Dow Corning is not high-tech because it did not win the
Apple iPhone business ..."_

I didn't say that. I cited the reference. Corning Inc. has the technology to
produce the product. The article cites lead time to set up a batch-run & lack
of facilities. Corning Inc. lost out because the Chinese firm was able to meet
the un-reasonable constraints, faster. Is that the real reason Corning Inc.
lost? I don't know, I just remember the NYT quote.

    
    
      "Dow Corning have kept significant amounts 
       of manufacturing in the country"
    

When an MIT hack reports Corning Inc. as an example of keeping manufacturing
in the US and the NYT incidentally reports Corning Inc. loosing a contract to
supplying a high volume, hi-tech manufactured product, something doesn't
tally. What's the real answer?

~~~
tsotha
Presumably Corning has other contracts. It's not that unusual to lose a
contract to the competition, foreign or domestic.

------
jfoutz
the US isn't particularly friendly to capital intensive businesses. Specific
factories will get local tax breaks, but you'd never see something like that
for airlines.

I wish i could remember the reference, Fred Smith (the fedex guy) laid out a
really clear argument why. The effect is, you just don't see that many long-
bet kind of investments. What's intel's threshold to pay of a new factory? 9
months?

I think stuff like they mention in the article - biotech, nanomaterials, etc -
will be fantastically more expensive here in the US. we don't have the
structure for that kind of risk.

~~~
flybrand
In textiles we see the opposite. Large capex businesses are still here in the
US since depreciation is such a big portion of your cost component (think big
battery separator, diaper or wipe production lines - 3 football fields long
24x7x365).

These big lines have almost no labor component (maybe 1-2 operators / shift)
so paying a premium on labor is worth it to reduce the shipping costs.

It is all of the heavy labor activities that are in China now. They didn't
just leave the US, they left everywhere that had high labor costs, and even
now they are flowing to SE Asia out of China. With low labor costs, and with
labor a significant component of cost, it made sense for these jobs to go
right away (especially if their fibers are agricultural in origin and now
harvested globally too).

~~~
jfoutz
Well, i'm not saying there's never capital investment - i'm saying the us tax
structure favors keeping that investment as small as possible.

From what little i recall of berkshire hathaway's history, textile automation
has been getting far more powerful and cheaper for like the last 150 years.
lot's of textile companies went out of business from betting the farm on an
expensive new machine, and not staying competitive 5 years out - because the
new machines are that much better.

So with biotech or something, you have all this extra hassle. Super tight
environmental control. Special heating and cooling for different resources.
Special containment for the lubrication of the machines, so the aerosolized
grease won't touch the stuff you're working on - all kinds of crap. basically,
all the complexity you have to deal with, plus a million extra constraints.

found the old link: <http://online.wsj.com/article/SB122488966230768509.html>

Fred Smith's argument is it's easier to make money with debt than it is by
actually making stuff. US business is forced to optimize around the cheapest
possible automation. Maybe that's a good thing, robots keep getting cheaper.
Maybe it's a bad thing, it's really hard to get the massive capitalization for
these fancy future industries.

~~~
mkramlich
you should read about Tragedy of the Commons and externalities.

------
OceanJackson
The character of a nation is stronger when aligned with those who create
value, than with those who move value around. The making is as important to
character as design. America needs more makers. Not all makers can be Hackers.
Makers on a National scale means more manufacturing jobs, the great middle
class participating in the making.

