Doom or Boom?
Listening to an expert panel predict the future of U.S. manufacturing, an engineer in the audience had heard enough. The panelists were far too optimistic. So he raised his hand and made a bold prediction of his own:
“I think manufacturing in this country will go the way of the family farm, which is to say there will be no manufacturing in this country in 20 years,” he declared. “I’m very concerned that my children will only be able to get jobs flipping hamburgers or stocking shelves at Wal-Mart.”
The engineer was more pessimistic than most audience members, perhaps, but there was no mistaking that concern about the future of U.S. manufacturing weighed heavily on the minds of engineers who attended “2020 Vision,” a panel discussion held during the Assembly East show June 10 to 11 in Boston. The show was colocated with Nepcon East and Electro. All totaled, the three shows offered some 230 exhibitors and drew more than 2,000 attendees.
Organized by ASSEMBLY magazine, the panel discussion was one of the highlights of a conference program that included sessions on workcell design, machine vision, flip chip and ball grid array assembly, lead-free soldering, and robotics for small parts assembly. The keynote speaker was Gregory S. Shelton, vice president of engineering and technology at Raytheon Co. (Lexington, MA). Shelton discussed how implementing Six Sigma has saved his company millions of dollars.
The 2020 Vision panelists were:
- Bob Stasonis, business development manager for Teradyne’s Assembly and Test Div. (North Reading, MA). A columnist for PXI Technology Review, Stasonis is president of the PXI System Alliance, vice president of marketing for the American Society of Test Engineers, and vice chairman of the Boston chapter of the Instrumentation and Measurement Society of the Institute of Electrical and Electronics Engineers.
- Dan Fleming, continuous improvement manager with the Greater Boston Manufacturing Partnership (GBMP), a nonprofit corporation that trains small- and medium-sized manufacturers in the principles of continuous improvement and lean manufacturing. Prior to joining GBMP, Fleming was director of operations at United Electric Controls Co., a 1990 winner of the Shingo Prince for Manufacturing Excellence.
- David Hess, lead project manager and certified lean implementer with the Massachusetts Manufacturing Extension Partnership (Woburn, MA). The nonprofit organization is part of a nationwide network of more than 70 centers that help small- and medium-sized manufacturers to succeed. Located in all 50 states, the centers are administered by the National Institute of Standards and Technology.
Although some members of the audience were pessimistic, the panelists agreed that manufacturing will continue in the United States 20 years from now. However, they warned that manufacturers must continue to innovate and control costs. “Manufacturing in the United States is strong today and it will remain strong,” says Fleming. “The real question is, are we ready and willing to embrace lean manufacturing? The current economic environment should be fueling the fires of continuous improvement, but not enough companies are going out to the shop floor and looking hard at eliminating waste.”
“I don’t believe manufacturing will go away in 20 years,” adds Hess. “We just have to learn to do things faster, cheaper and better. Having been through it, I can say that lean manufacturing is unbelievably powerful.”
When asked what products will still be made domestically 20 years from now, the panelists agreed that military, medical and automotive products will stay home. “The Defense Department will be very concerned about producing things locally,” says Stasonis. “And automotive manufacturers have always believed in a short supply chain. If you look at an automotive assembly plant in the United States, you’ll see its suppliers are always close by.”
Production of electronic products and appliances will likely continue shifting to other countries. “Major appliances and low-end consumer electronic products will be made overseas, because you can make predictions about deliveries,” Stasonis says. “New-product introduction work will be done here, to get excitement going. But once the product is established, it will be moved overseas.
“On the other hand, a lot of contract manufacturers wished they had not shuttered assembly lines in the United States when the [severe acute respiratory syndrome] epidemic in Asia started to shut off the supply chain.”
While the panelists concurred that technological innovation is a major strength of the United States, they worried that we could lose that advantage. “Cutting spending on R&D is a concern,” says Fleming. “In a down economy, the traditional knee-jerk response is to cut resources for development, marketing and advertising—the key resources that companies need to grow. Those resources really need to be left alone.”
Stasonis expressed concern that too many U.S. manufacturers give away competitive advantages when they outsource hot new technologies. “Most new technologies come from here, but they get refined in other countries,” he says. “We pat ourselves on the back when we develop a great new technology, but then we hand it to the accounting department, which says it’s cheaper to produce overseas. ...How much of our intellectual property are we willing to outsource?
“In the next 5 years, the average car will contain well over $1,500 worth of electronics. That stuff should be made and tested here.”