Brookings: Manufacturing isn’t dead but it needs help

Manufacturing has suffered severe job losses since 2000, but it remains critical to the economy of some states, including Tennessee, according to a think tank report released today.

The report calls on states to rethink their economic development policies and to invest in “advanced manufacturing centers” that would provide research and education services for manufacturers.

“America’s manufacturing sector must be reinvigorated in order to build a healthy economy, and the nation’s states and metropolitan areas are strongly positioned to be the vanguard for this effort,” according to a report from the Brookings Institution.

The manufacturing centers recommended by Brookings would cost about $9 million and states could pay for them by redirecting a relatively small amount of the money they “now spend (either directly or as tax expenditures) on subsidies to attract new businesses,” the report says.

Good luck with that happening any time soon in Tennessee.

Given the current political climate, convincing the Legislature to invest in any new programs will be difficult.

Even so, the report makes a compelling argument for investing in the manufacturing centers.

Existing state economic development policies “are not focused on what would be most helpful for manufacturers: which is helping them, particularly small and medium-sized businesses in the manufacturing supply chain, develop or apply more advanced technologies. To remedy this problem, states should create advanced manufacturing centers that provide both research to develop new, relevant technologies and the education to help businesses throughout the supply chain apply these technologies to their work,” the report says.

The centers aren’t a complete solution but “state-supported manufacturing centers are superior to states’ typical business attraction incentives as a way of strengthening a state’s manufacturing base. Their job-creating and wage-boosting potential is longer-term but more solid because it builds on states’ existing technological, management,and workforce capacities in manufacturing instead of chasing footloose plants.

It’s advice worth considering. 

Here’s the full report — Accelerating Advanced Manufacturing with New Research Centers