Future Now
The IFTF Blog
Fine Time For A Manufacturing Comeback
The Economist's The World in 2009 arrived this morning, and with it a fascinating piece by Rolls-Royce CEO John Rose. Calling for a renewed emphasis on high value-added manufacturing in Britain, Rose argues:
High-value-added manufacturing brings huge benefits. It penetrates the economy of the entire country, not just London and the south-east. It pays well but avoids bewildering distortions of income. It drives and enables a broad range of skills and stimulates the growth of services. In short, it creates wealth.
Indeed, IFTF's recent forecasts on the future of making and some of our private consulting on future R&D models echo this view. As IFTF research Alex Pang has written, the co-location of R&D and manufacturing operations is a major competitive advantage of many kinds of high-tech, high value-added manufacturing like semiconductors and microprocessors.
The current debate over the U.S. auto industry bailout, which has largely focused on questions of leadership and accountability, seems to have missed this point. How can the company create value from the know-how of all of those UAW workers, who have tens of thousands of lifetimes of largely untapped knowledge about how to best build automobiles.
Second, manufacturing is a great strategy for linking R&D to local development, making science in place sticky. Rose's facts about Rolls-Royce's impact on the local economy are stunning:
The benefits are seen clearly in Derby, where around 11,000 people are employed by Rolls-Royce and a further 15,000 in its supply chain. Nearly 12% of the city’s workforce is involved in high technology, the highest figure in the country, and the number of skilled employees is 2.4 times the national average. Derby’s contribution to the British economy, measured by gross value added, is growing faster than that of any other city.
Mr. President-Elect, hast thou a strategy for re-vitalizing U.S. manufacturing, and using it as one of your levers to restart the economy and spur innovation?