McKinsey&Company
New spending for US factories
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From Asia to America. After years of relying on foreign factories, many based in Asia, business leaders are expanding US manufacturing again. Recently, one automaker stated that it would likely invest $4 billion to make more of its electric vehicles and batteries in Michigan; another company plans to build a $17 billion chip-making plant in Texas. Shipping delays, rising costs of freight, and clogged ports have all induced leaders to consider localizing production. [NYT] |
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A raw deal for materials. In January, growth in US manufacturing slowed slightly for the third month in a row. Amid the Omicron surge, new orders and production fell to the lowest point of the past year and a half. Demand for raw materials continues to far outstrip supply, contributing to an increase in prices of nearly eight percentage points—the biggest jump since late 2020. [Bloomberg] |
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Building an inclusive workforce. Manufacturing is the main employer in about 500 counties across the US. In these communities, the manufacturing sector employs a wide range of the population—and it does so more inclusively. In most cases, employees don’t need a four-year degree to get hired, and they also enjoy higher salaries than service sector workers. However, to draw new talent, the industry must strengthen its reputation. By partnering with colleges and trade schools, companies may attract more young people. |
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One million open jobs. Restoring competitiveness in 16 manufacturing industries could raise America’s annual GDP by more than 15%, according to research from the McKinsey Global Institute. Yet as the US manufacturing sector speeds toward a digital, automated, and more sustainable future, more than one million jobs remained unfilled in October 2021—the highest on record. Explore three actions leaders can take to restore manufacturing to its position as a powerhouse of the US economy.
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| — Edited by Belinda Yu |
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