Offshoring became a mantra for corporate America in the past decade, as companies shifted production abroad to save on wages and overhead. Now, a halting recovery in manufacturing employment in the United States — fueled by low domestic energy costs and rising wages in emerging economies — has pushed the industry to the front of a new bipartisan drive to spur job creation before the 2014 elections.
President Barack Obama signaled his party’s pivot to manufacturing jobs during a visit to an ArcelorMittal steel mill in Cleveland on Nov. 14. “We should do everything we can to revitalize American manufacturing. Manufacturing is, that’s the hub of our economy. When our manufacturing base is strong, the entire economy is strong,” Obama said. Partisan firefights over implementation of the health care law and on fiscal priorities have left little room for big-ticket items in the 113th Congress and with the prospect of stalemates on legislative action on immigration and a tax overhaul, lawmakers may see the continued revival of domestic manufacturing as an opportunity to move less-divisive provisions.
They may move measures that have already been written that would provide incentives for research, job training and investment, and tax cut extensions such as those in the fiscal-cliff agreement.
Supporters have seized on the 4 percent expansion to 12 million manufacturing jobs since 2010 to make the case for more incentives to sustain, and build on, the growth. Although the growth is relatively modest, it follows a shakeout in the industrial sector that saw the loss of a third of all manufacturing jobs between 2000 and 2010, as companies turned to outsourcing and later dealt with the 2008 financial meltdown.
While some of the recent job gains may be part of a cyclical rebound, labor experts such as Martin A. Schmidt, acting provost of the Massachusetts Institute of Technology, said it signals that the industrial sector is anxious to expand and that the “reshoring” of jobs can accelerate if companies can generate new products, find skilled workers and raise more capital. “We need to find ways to strengthen our supporting infrastructure in the manufacturing sector,” he said.
With that goal in mind, Mark Begich of Alaska, chairman of the Democratic Steering and Outreach Committee, said job training and research would be top priorities in early 2014. “We’ll come back from the holidays, start the year fresh and talk about jobs,” he said.
Sen. Chris Coons of Delaware, the point person for the Democratic manufacturing agenda, said incentives could move on different vehicles, such as a job training reauthorization, a proposal to raise the hourly minimum wage from $7.25 to $10.10, and a replacement for the continuing resolution that expires Jan. 15 .