Members in the News

    Opinion: Manufacturing Creates Value for Employees and Communities

    Cincinnati Enquirer 
    January 26, 2015 
    By: Mike Schmitt 
    [TTMA & NTMA Member Featured]

    In Tuesday night' State of the Union Address, President Obama discussed improving employment through initiatives that would include trying to create more manufacturing jobs. The Enquirer asked area manufacturing executives for their views on how to make this vision for manufacturing a reality.

    The State of the Union speech was accurate. The blueprint for economic growth begins with American manufacturing.

    The perception that manufacturing in America is declining is misguided. The United States is still the world' largest manufacturing economy, producing 21 percent of global manufactured value. U.S. manufacturing produces $1.6 trillion of value each year, which is 11.2 percent of U.S. GDP, supports one in six private sector jobs - or 18.6 million jobs in the United States - and performs half of all R & D in this country.

    U.S. factories utilize advanced technology from robotics, high tech laser systems, and complex computer driven machinery. The modern factory is clean and safe. Manufacturing jobs offer higher pay and more benefits than other sectors. The image of manufacturing needs to reflect this in order to attract young people.

    Our industry has experienced severe stress prior to the current recovery, and significant challenges remain to ensure growth. The President and Congress could assist in overcoming this by developing stable and sensible policies in the areas of education, taxes, energy, healthcare and fair trade.

    More emphasis is needed on providing vocational and skills training in order to implement the demands of new technology. There are great programs in this region, but more are needed. Employers and school systems should do their part by encouraging manufacturing and technical skills as part of the curricula, and inviting companies to visit students. Increasing funding and incentives in this area is a requirement for growth.

    Policy makers need a better understanding of how smaller companies are structured. The great majority of small manufacturing firms are classified as pass through entities for tax purposes. We pay income tax on profits left in the company for reinvestment.

    Tax incentives to reinvest in our companies are required. Expansion of the capital equipment investment tax program is needed. Small manufactures take every opportunity to upgrade technology, because we are in an extremely competitive and international market.

    Uncertainty needs to be removed from the business environment. We need stable policies that commit to predictable and competitive electricity and other energy. Costs continue to increase in health care, regulatory requirements and other insurance because the market does not know the implications of current policies.

    Our customers, and all U.S. manufacturers, are under intense price pressure from abroad. Simpler regulations, a sustainable and internationally competitive energy policy, and addressing foreign countries that subsidize manufactured products or manipulate currencies are issues our government can affect.

    Our region benefits from a diverse economy and a solid core of skilled people. We can make manufacturing a growth engine with the right manufacturing policies.

    Americans who work in manufacturing are the most productive and innovative in the world. I have visited competitors internationally and believe passionately that if the playing field is level, our companies just won't compete globally, we will win.

    Mike Schmitt is president of The Metalworking Group, a contract manufacturer and invested $1 million in new technology last year.