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Yul Kwon

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The Rebirth of American Manufacturing

Posted: 05/ 1/2012 4:46 pm

Before I began filming the final episode of America Revealed, the four-part miniseries on PBS that examines the vast systems that make our modern lives possible, I assumed that any effort to assess the state of American manufacturing would be a sobering, if not downright depressing, exercise. Like a lot of people, I had come to accept the conventional wisdom that America doesn't make anything anymore and that all of our manufacturing jobs have gone overseas.

Indeed, the first place I visited while making "Made In America," the episode that airs this Wednesday at 10:00 pm (EDT) on PBS, seemed to underscore this point emphatically. At the Port of Savannah in Georgia, I learned that America's biggest export by volume isn't a high-value product like a computer, car, or jet engine. It's paper.

But over the course of my cross-country journey exploring different industries, I gained a far more nuanced perspective on American manufacturing. What I discovered is that the prevailing narrative of decline and decay is overly simplistic and, in some ways, flat-out wrong. It turns out that America still makes lots of things. In fact, we manufacture more products today than at any other time in our history. But how we make things and what we make has changed -- in some cases, dramatically.

Our manufacturing base used to be concentrated in a handful of large cities that were largely defined by what they produced. Detroit cranked out cars, while Pittsburgh was all about steel (hence, the Pittsburg Steelers). Many smaller cities were "company towns" where one firm supplied lifelong jobs to much of the community. Today, American manufacturing is more geographically diversified, less labor-intensive, and radically more efficient.

For example, in Charlotte, North Carolina, I found a steelmaker that was experiencing record growth even as many of its competitors wilted from international competition. Nucor Corporation realized that traditional ways of making steel in America simply could not compete with low-cost suppliers overseas, so it decided to invest in groundbreaking manufacturing approaches, such as using electric furnaces instead of conventional furnaces, and recycling scrap metal instead of mining iron ore. Today, Nucor is America's most profitable steel-maker.

At an Intel microchip factory in Chandler, Arizona, I witnessed the manufacturing of tiny circuits. For this privilege, I first had to spend an hour contorting myself into a "bunny suit," a spacesuit-like outfit that kept the dirt and hair on my skin safely away from the delicate microchips as they were being assembled in a facility thousands of times cleaner than a hospital operating room. Intel's success has been predicated on its ability to pack more and more circuits onto a microchip efficiently. As one engineer said, "We can do it faster, better, and cheaper than anyone else." But Intel isn't just relying on its engineers to improve its manufacturing processes. It's also relying on a team of futurists, ethnologists, and anthropologists to anticipate where technology needs to go in order to meet evolving human needs.

In Nazareth, Pennsylvania, the iconic guitar-maker, Martin Guitars, discovered that innovation in the manufacture of guitars didn't necessarily mean replacing people. Quite the contrary, they learned that there are some things you can't replace, like highly skilled human expertise. When they tried to automate and outsource too much, they began losing the very thing that made their products unique. So today, they've figured out how to automate the low value-added parts of the manufacturing chain while applying the skills of their employees towards the areas that require a uniquely human touch.

Interestingly, I learned that the term, "Made in America," is itself evolving. American manufacturers nowadays often have foreign names. Over the last 20 years, the majority of the new auto plants in America have been built by foreign companies like Honda, Toyota, BMW, and Nissan. Together, these companies have put about $44 billion of new investment in the U.S., and they now employ about 80,000 Americans. Why have so many foreign companies decided to build manufacturing plants here? As one expert I interviewed explained, "The United States is still a good place to build stuff, especially high-value added stuff."

Due to the ingenuity and resilience of companies like the ones I met on my journey, the value of what American workers manufacture today is nearly twice what it was in 1990. We make more than 1.7 trillion dollars' worth of goods each year -- more than China, Germany, Japan or any other nation on earth. As surprising as it may seem, America is still the world's number one manufacturing country. Domestically, manufacturing still accounts for 12% of the U.S. economy, employs about 11 million Americans, and generates countless spin-off jobs.

Of course, one inevitable consequence of automation and other advances is that while our productivity has increased -- and we can now produce things of greater value than ever before -- we often need fewer people to make them. Combined with the outsourcing of lower value-added jobs overseas, the resulting loss of jobs in certain industries has been devastating to many American communities, especially those that grew up around large industrial cities and company towns. Too often, I saw the decaying hulks of a bygone era -- abandoned warehouses and shuttered factories -- still dotting the American landscape.

But if you look beyond the narrow parameters of manufacturing as it's traditionally been conceived and consider what kinds of things are being created in 21st-century America, the picture looks quite a bit different. American engineers used to make things that you could see and touch. But increasingly, what they make now is less tangible but more valuable.

The Internet has not only revolutionized the way products are manufactured, but it's created a new information-based economy in which the raw materials are ideas. Silicon Valley and other technology clusters have become powerful engines of economic and job growth, even though many tech companies don't sell a product you can hold in your hand. Take Facebook, for instance. The concept of an online social network hardly existed not long ago. But today, Facebook is one of the most valuable and influential companies in the world, with more users than the population of every country outside of China and India.

American companies dominate this new economy, yet despite their constantly rising need for talented engineers, we're not producing enough workers to meet demand. The jobs are there, but the people who need them don't have the skills to fill them. So the larger questions loom: How can we bridge the skills gap between our current workers and the jobs that are growing? How can we retrain workers who have lost traditional manufacturing jobs so that they can become employable in today's economy? How can we educate our children so that they have the tools and training they need not just to find jobs, but to continue the tradition of innovation that has made America the most productive nation in history?

There aren't any simple answers to these questions, and they lie outside the scope of my journey on "America Revealed". But even without finding the answers, I came away from my experiences with a newfound optimism that I hadn't expected to gain.

A revolution is unfolding in what and how America creates. But there is no question in my mind that America is still the best place on earth to build new things, and that our leadership in innovation will endure. What struck me most during my travels is that every person I met harbored a fundamental pride in being American, and a basic faith in the future of our country. By the end of my journey, I couldn't help but feel the same way.

I'll be live tweeting during the final episode of America Revealed Wednesday night. Please send me your questions and perspectives at #PBSAmRev.

The author, a lawyer, is the host of PBS's
America Revealed airing nationally on Wednesday evenings at 10:00 pm (Eastern Time) through May 2nd.

 
 
 
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