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Manufacturing Initiative Draws Mixed Reviews

 

NEW YORK — Lobbying efforts by America’s metals and manufacturing sector may be beginning to pay off if a $500-million-plus initiative announced Friday by President Obama delivers on its promise to create high-quality manufacturing jobs while enhancing the nation’s global competitiveness.

 

The plan centers on the formation of an Advanced Manufacturing Partnership (AMP), a joint private-public partnership teaming 10 large American companies, six top engineering universities and the federal government to invest in emerging technologies and create new jobs, the White House said. The federal government will provide more than $500 million to jumpstart the effort.

 

AMP will be led by Andrew Liveris, chairman, president and chief executive officer of Dow Chemical Co., and Susan Hockfield, president of the Massachusetts Institute of Technology. Manufacturers initially involved in the effort are Allegheny Technologies Inc. (ATI), Caterpillar Inc., Corning Inc., Dow Chemical, Ford Motor Co., Honeywell International Inc., Intel Corp., Johnson & Johnson Inc., Northrop Grumman Corp., Proctor & Gamble Co. and Stryker Corp.

 

"If we want a robust, growing economy, we need a robust, growing manufacturing sector," Obama said in a speech at Carnegie Mellon University in Pittsburgh. There was a time when the United States was the No. 1 steelmaker in the world, and that kind of "entrepreneurial spirit" should be applied to every other industry, the President said.

Reaction to the launch of AMP was mixed.

 

"It’s a nice gesture, but it’s a down payment," said Stephen Gold, president and chief executive officer of the Manufacturers Alliance/MAPI, a public policy and economics research organization in Arlington, Va. "There doesn’t seem to be a larger, overall intricate strategy."

 

Congress has been heavily criticized by the steel and other industries for not paying enough attention to creating jobs—or, more specifically, for failing to stem steep job losses. Manufacturing jobs have moved eastward, they point out, where lower standards of living and lower wages are strong incentives for multinational companies.

Others see a more multifaceted solution. In a letter sent to President Obama by House Steel Caucus chairman Rep. Tim Murphy (R., Pa.), the congressman called for Washington to pay more attention to anti-competitive practices by foreign trading partners and rebuilding the nation’s infrastructure.

 

The Alliance for American Manufacturing said in a press release that although AMP shows a lot of promise, the effort will be futile unless the U.S. ensures there is a solid foundation to counter unfair trade practices and currency manipulation, develop and maintain a skilled work force and build a more efficient infrastructure.

At the Steel Success Strategies XXVI conference in New York, Nucor Corp. chairman and chief executive officer Daniel R. DiMicco told attendees that the lack of job creation in the country weighs on the industry’s profitability and likelihood of survival. He charged that the nation’s leadership cannot "do the nation’s business" and warned that "unless we get our hands around (it) we will not recover strongly and to the levels we were at before" (AMM, June 23).

 

Others see politics behind the initiative and the President’s decision to unveil it in swing-state Pennsylvania 17 months ahead of the next presidential election. The inability to create jobs has been one of the top issues plaguing the administration. May’s unemployment rate remained at 9.1 percent, while manufacturing lost 5,000 jobs. Jobs in fabricated metal products and machinery were offset by losses in transportation equipment, paper and paper products, printing and related support activities.

 

"It’s enormously political, as everything in this day and age is," Gold said. "But I sincerely think both the Democratic and Republican parties have a growing understanding that if you want to make a long-term stable economy, you have to recognize that the manufacturing sector is the single most important sector for job growth."

A spokesman for Pittsburgh-based specialty steelmaker ATI said that while the company is waiting for more information, it is encouraged it was included in the initiative. "It’s exciting to see that the administration is putting a focus on advanced manufacturing," he said.

 

Others were less excited. "Realistically, if you want to go from 12 million to 18 million jobs again, you have to come up with a dramatic change in public policy that encourages lots of mid-size and small companies," Gold said. "You need to do that through tax laws, alleviating some of the regulatory burdens that small companies shoulder, because they are the primary generators of jobs."

 
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