51�Թ���

Last week, Saint Paul College in St. Paul, Minnesota, which boasts a student body that is 65% people of color, became the 19th stop of 20 for the Creators Wanted Tour, a joint project of the 51�Թ��� and the Manufacturing Institute, the workforce development and education affiliate of the 51�Թ���.

Over three days, with Union Pacific as the lead sponsor, the stop drew more than 600 visitors, from students to educators. Meanwhile, 42,000 online signups in Minnesota helped the campaign surpass 1.5 million nationwide from students and career mentors interested in modern manufacturing careers.

Twin Cities kickoff: Union Pacific Executive Vice President of Marketing and Sales Kenny Rocker gave the keynote address at the , emphasizing the reward of manufacturing careers. He was joined by MI President and Executive Director Carolyn Lee, Saint Paul College President Dr. Dee Dee Peaslee, Minnesota Chamber of Commerce President and CEO Doug Loon and Trane Technologies Vice President of Product Management Dave Molin.

• “When I talk about opportunities, I’m talking about really good-paying jobs … At Union Pacific, we’re talking jobs that are … averaging over $100,000 a year, and that’s without benefits, and so you just really have an opportunity to make an impact from that perspective,” said Rocker.

• “At Trane Technologies, our vision is to boldly challenge what’s possible for a sustainable world,” added Molin. “It is the engine of our company, and we live it every day. And to do that, we need bright minds and the best minds in the world. We need diverse thinkers, we need creators, and our doors are open to everyone.”

• Notably, leaders from key government business and workforce partner organizations attended the kickoff, including the Minnesota State Advanced Manufacturing Center of Excellence, Minnesota Black Chamber of Commerce, Minnesota Parent Union and St. Paul Area Chamber, representatives from the offices of U.S. Reps. Brad Finstad (R-MN-1), Angie Craig (D-MN-2), Dean Phillips (D-MN-3), Betty McCollum (D-MN-4) and Michelle Fischbach (R-MN-7), Mayor of South St. Paul Jimmy Francis and State Reps. Jon Koznick (R), Emma Greenman (D) and Samantha Sencer-Mura (D).

Experience and exploration: Students delved deep into immersive activities, from solving manufacturing-related puzzles in the Creators Wanted mobile experience to virtually navigating a locomotive through Union Pacific’s simulators. Equally captivating was the sight of the actual railroad track, which was complemented by insightful career anecdotes from Union Pacific professionals.

• Eighty-seven percent of students surveyed reported a significantly improved view of modern manufacturing careers after completing the immersive experience.

Live Q&A sessions: The stop also offered structured opportunities for students to learn about manufacturing organizations’ support for the next generation of talent, along with the importance of mentorship and personal development in shaping successful careers.

• The , featuring two Union Pacific senior managers—Amy Bang, Sr. manager of diversity and inclusion, and Ken Kuwamura, Jr., manager of talent acquisition—and Saint Paul College instructors, zeroed in on the crucial roles of mentorship, diversity and .
• The , with Jake Yernberg, automotive instructor, Saint Paul College; Caitlin Bundy, manager of corporate sustainability, Union Pacific; and Preeti Subramanian, senior product manager, Trane Technologies, accentuated the pivotal role of manufacturing in tackling global challenges. Panelists pointed out the advantages of the manufacturing sector, citing competitive pay and the sector’s potential in , such as sustainability and climate change.

Interactive Learning: Everfi^®, Ecolab and Schwan’s joined Union Pacific in bringing in representatives to give students career advice—and offer activities to spark their curiosity.

• Everfi^® showcased a new digital education program, “Future Creators,” co-developed with the MI and Union Pacific, to give middle and high school students a peek into STEM careers.
• Saint Paul College also took students on a tour of its robust Trades and Technical Education program.

Beyond the Tour: The Twin Cities event is a part of Union Pacific’s overarching initiative, which aims to inspire more women and youth to pursue modern industrial careers, and the sustained drive to enhance perceptions of manufacturing careers in the United States and empower more people to create the future.

The last word: “I want all of you out here, the students, to have an opportunity to go out there and win and compete and further your careers and do well in life,” said Rocker, echoing a theme the Creators Wanted Tour has promoted since its inception: manufacturers and manufacturing care about students and their future.��

Next up: The pioneering Creators Wanted Tour concludes next month, Oct. 17–21, at the in Circleville, Ohio.��

To restore a U.S. tax landscape that promotes manufacturing competitiveness, Congress should act quickly in advancing bicameral, bipartisan legislation that would ensure the tax code once again supports innovation.

That was the message from the 51�Թ��� and several manufacturers to lawmakers last week.

What’s going on: The 51�Թ��� and company leadership from manufacturers Westminster Tool and Brewer Science visited Capitol Hill last week to brief legislators on a harmful change to the tax treatment of research and development.

• The briefing was held by the 51�Թ���-led R&D Coalition in cooperation with the offices of Reps. John Larson (D-CT) and Ron Estes (R-KS) and Sens. Maggie Hassan (D-NH) and Todd Young (R-IN).
• Larson and Estes introduced the American Innovation and R&D Competitiveness Act in the House, while Sens. Hassan and Young introduced the American Innovation and Jobs Act in the Senate. These are the measures manufacturers are urging legislators to pass.

Why it matters: “We paid $26,679 per full-time employee in additional federal tax this past year” because of the change, Westminster Tool Chief Financial Officer Colby Coombs told lawmakers at the briefing.

• “This increased federal tax on R&D forced us to cancel a major aviation contract that would have added … new jobs in our community and forgo a significant capital investment. Without fixing this issue, in 2023, we expect an additional tax bill of almost $18,000 per employee,” he continued.
• Added Brewer Science Government Programs Director Doyle Edwards: “We have lost IP to China in the past, and fight[ing] that in the courts is a no-win situation. So the only way to win is to out-invent them. And that’s what we invest our money to do. However, with [the tax change] … we’re allowing China to actually catch up.”

The background: For nearly seven decades, manufacturers could deduct their R&D expenses fully in the year in which the costs were incurred. However, since the change last year, businesses must instead deduct these expenses over a period of years, making R&D more costly.��

Legislative fix: To protect manufacturers’ R&D, jobs and competitiveness, Congress should move immediately on bipartisan legislation to restore R&D expensing.

• “R&D is the lifeblood of advanced technology development for our company, for our industry, but really for the nation,” Edwards continued. “And so our message is, we need your help. We need your leadership to resolve this policy issue.”

Take action: Learn more about what the 51�Թ��� is doing to advocate for sound tax policy at our R&D action center.

Within the footwear business, Okabashi is unique. The company, based in Buford, Georgia, is not only a family-owned company focused on sustainability, but also, according to the company’s leadership, producing part of the 1% of footwear still made in the United States.

For third-generation shoemaker Sara Irvani, this choice to build a sustainable and successful business in the U.S. was made possible only thanks to constant research and development.

The backstory: Irvani’s family started the company 40 years ago, and it always tried to reduce waste, both for the positive environmental impact as well as to improve its bottom line.

• “By developing closed-loop manufacturing processes, we were able to reuse some of the materials that otherwise might have gone to waste,” said Irvani. “That helped us stay more competitive—and from there we’ve developed innovations in processes and systems and materials that build on that foundation.”

The process: Okabashi’s sustainable processes extend throughout the product lifecycle—from incorporating recycled or biological elements (like soy) that ensure products last longer to preventing disposable waste to recycling post-consumer shoes into new ones.

• “When we look at sustainability of a product, we do it holistically—we look at what it’s made of, where it’s made, how it’s made, the lifecycle, the quality—and we’ve been able to innovate and develop so that our manufacturing process doesn’t create waste,” said Irvani.
• “Without R&D, we would not only be creating the additional cost basis of throwing away all those scraps, but we would also not be able to eliminate waste that is by default landfill or ocean bound.”

The circular economy: In the traditional, linear economic model, inputs go into production, a product reaches a consumer, the consumer uses the product and eventually throws it away. In contrast, Okabashi is working to perfect a circular economic model for its products, said Irvani.

• “If you are designing for circularity, you might use renewable and recycled resources, develop them into that same product with a level of quality that lasts longer, and when the customer is ready to move on, it can be remade into something else,” said Irvani. “That’s how the loop continues. When we talk about circularity, we’re creating that virtuous cycle.”

The homegrown production: Okabashi’s R&D efforts both help it stay in the United States by keeping costs down and require domestic production to work.

• “To remake and recycle a product into something new, you need to have local production,” said Irvani. “You can’t be sending things halfway across the world to be unmade and remade and sent back. That’s why R&D locally and domestically is so important, to help produce circular systems.”

The local benefit: Irvani is quick to point out that money spent on R&D creates significant financial benefits for local communities.

• “There’s a multiplier effect for commercially oriented R&D in terms of the jobs it can create and the impact on the local economy,” said Irvani. “You get a very strong return on investment for both the company and for the community.”

The global perspective: R&D is essential for U.S. companies competing with manufacturers abroad, Irvani added.

• “For U.S. manufacturing broadly, R&D is critical to stay at the forefront of the innovation curve,” said Irvani. “Unless we’re proactively investing and developing new and better ways of doing things, we won’t be globally competitive.”

The last word: “It is imperative industry and retail move toward a circular-based economy,” said Irvani. “That’s not something that just happens or falls from the sky. Consumers are demanding it, and R&D is our pathway to that future.”

The 51�Թ��� and the Kentucky Association of Manufacturers are hitting back against an attempt by the Securities and Exchange Commission to force privately held businesses to make public financial disclosures.

What’s going on: On Tuesday, the 51�Թ��� and KAM filed suit in federal court challenging the SEC’s novel reinterpretation of its Rule 15c2-11.

• The reinterpretation—on which the SEC has not granted companies the opportunity to comment—would require private firms to release confidential financial information publicly.

The background: Rule 15c2-11 requires disclosures to protect investors in publicly traded companies issuing so-called “penny stocks.” But the SEC has broadened the rule’s application to include privately held companies that issue corporate bonds to large institutional investors under an entirely different regulation, called Rule 144A.

• Everyday investors can’t purchase corporate bonds issued under Rule 144A, so there is no reason to require public disclosures from these businesses.

Why it’s important: Expanding Rule 15c2-11 will mean higher borrowing costs and reduced liquidity in both the manufacturing industry and throughout the larger economy, according to a new released by the 51�Թ���.

• The reinterpretation would lead to job losses of more than 100,000 every year, according to the analysis.

Manufacturers speak out: “The SEC never allowed public comment on its novel reinterpretation of Rule 15c2-11, there is no conceivable benefit to the new standard and the SEC did not consider the impact that its about-face will have on privately held businesses,” 51�Թ��� Chief Legal Officer Linda Kelly. “The 51�Թ��� Legal Center is filing suit to hold the SEC accountable and protect manufacturing growth, job creation and U.S. competitiveness.”

• KAM President and CEO Frank Jemley added: “The SEC’s unlawful overreach threatens privately held manufacturers in Kentucky and across the country, so the Kentucky Association of Manufacturers is proud to join the 51�Թ��� in this important litigation.”

Bringing back parts of a policy it dropped more than half a century ago, the National Labor Relations Board moved late last week to reinstate an abridged version of “card check,” according to (subscription).

What’s going on: In a “3-1 decision in a case involving building materials company Cemex Construction Materials,” the NLRB unveiled a new framework last Friday that revives the 1949 Joy Silk doctrine, which holds that “employers must bargain with unions unless they have a good-faith doubt that majority support exists.”

The background: The board had tossed out the doctrine in the early 1970s after the Supreme Court’s decision in NLRB v. Gissel Packing Co., in which the court held that “the NLRB could force employers to bargain with unions when they engage in misconduct so severe that any election would be tainted.”

• This new decision “could provide a major boost to unions by allowing them to represent workers in certain cases when a majority sign cards in support of unionizing, rather than going through the lengthy and often litigious election process.”
• Last week’s move also came a day after the a return to Obama-era regulations purportedly aimed at speeding up union elections.

Why it’s problematic: Card check—which the 51�Թ��� has long opposed—is inherently unfair and insecure, and it strips employees of their right to secret ballots, said 51�Թ��� Director of Infrastructure & Labor Policy Ben Siegrist.

• “The NLRB’s decision could create a glide path to force unionization on workers without the necessary safeguards of an election, and it runs counter to 50 years of precedent established by the Supreme Court,” he said. “Effectively, this action contradicts the rights all employees have in determining their own representation.”

As manufacturers continue to reel from supply chain disruptions, the 51�Թ��� is calling for a swift resolution to forestall a potentially devastating United Auto Workers strike.

What’s going on: The UAW is negotiating a new labor agreement with important automotive manufacturers, as the current contract expires Sept. 14.

Why it’s important: The automotive manufacturing industry in the U.S. is one of the strongest and most productive in the world, and it significantly supports the health of the U.S. economy.

• A strike of 143,000 UAW members against Detroit’s “Big Three” auto manufacturers could mean an economic loss of $5.617 billion after just 10 full days, according to a new by Anderson Economic Group.
• Nationwide, every $1 spent in the transportation-equipment sector causes another $1.59 to be spent elsewhere—for a total economic impact of $2.59, according to 51�Թ��� calculations using
• In 2022, the total value-added in motor vehicles and parts in the U.S. was $171.6 billion, according to the Bureau of Economic Analysis.

State-level impact: In 2019, a 42-day auto-worker strike at one of the Detroit manufacturers “sent the state of Michigan into a one-quarter recession” and resulted in an economic loss of $4.2 billion, according to reporting by .

• As of 2021, the latest year for which this data is available, Michigan’s total output from motor vehicles, bodies and trailers, and parts manufacturing was $37.5 billion, accounting for 37% of total manufacturing output in the state, according to the BEA.
• At the same time, Michigan had 175,745 full- and part-time employees in the sector, or 28.7% of all manufacturing employees in the state.
• Meanwhile, the total output of Illinois’ auto sector accounted for 19.3% of the state’s total manufacturing output, while employment came to 23.6% of the state’s manufacturing employees.

Undermining manufacturing in the U.S.: “Manufacturers in America, especially in the automotive sector, operate in an integrated supply chain, which means that small and medium-sized manufacturers around the country—in union and non-union shops—would endure the consequences of a stoppage. As we continue to emerge from the global pandemic and work to get our economy on a sustainable track, a strike would be devastating for working families across our country,” said 51�Թ��� President and CEO Jay Timmons.

• “President Biden has prioritized strengthening manufacturing in America, but that will be quickly undermined if a strike occurs. The administration should be encouraging a swift resolution to avoid ripple effects throughout the broader manufacturing economy and in communities from coast to coast.”

After a global pandemic and amid considerable economic strain, worker morale may not be everything a company hopes. So what can leaders do to boost communication and restore a sense of excitement and purpose?

The Innovation Research Interchange—the 51�Թ���’s innovation division—recently published a on morale building, drawing on copious existing research as well as consultations with leaders in a range of industries (from aerospace to consumer goods). Here are some of its key recommendations.

Senior leaders in the trenches: The best way to understand company morale (or its absence) is to go looking for it. In one notable case, FM Global Chief Science Officer Lou Gritzo spent a day working in each company lab, so he could understand where communication and cooperation needed improvement.

• Thanks to this experiment, Gritzo was able to “open lines of communication up and down the organization,” according to the IRI, leading to both an improved flow of information and greater comfort among lab staff in making independent decisions.
• “For others looking to try their hand at being a (not so) undercover boss, [Gritzo] recommends setting out rules of the road in advance,” the IRI paper notes. “The goal is to create a dialogue, not make guarantees that things will change. The change comes from the relationships built.”

Support for midlevel managers: Many participants in the IRI’s roundtables and interviews agreed that midlevel managers have only become more crucial in recent years—which explains why these managers are often very stressed.

• Amid the pressures of the pandemic, companies began offering more support and coaching for middle managers, according to earlier IRI research.
• One organization studied by the IRI and its research partner, Babson College, brought in coaches to work with managers—but not just for one-off sessions. “The external coaches were brought in multiple times during a one-year period in order to observe leadership styles and gave feedback openly,” which led to improved communication and greater autonomy among the managers.

Everyone an innovator: Another way to boost morale is to make sure great ideas are always recognized, no matter who comes up with them.

• At ICL Group, leaders devised a novel way to encourage innovative thinking: “an online platform that allowed anyone at ICL Group to propose an idea, have it reviewed by management, voted on by frontline staff and assigned to the appropriate team for implementation.”
• The platform has proved very popular, according to one senior leader, who said, “Everybody has just been blown away by how many ideas people have entered and [how many employees] continue to do it.”

Read the whole thing: Check out many more useful details and expert advice in the full whitepaper, which you can find .

Flashback to 2015: “Hamilton” debuted on Broadway, millennials surpassed baby boomers as the largest U.S. generation and the term “Industry 4.0” was gaining traction in manufacturing circles. It was also when the Manufacturing Leadership Council created a conceptual framework called “Manufacturing 4.0.”

So what is the difference between Industry 4.0 and Manufacturing 4.0? While the terms may not sound all that distinct from each other, Manufacturing 4.0 represents the MLC’s commitment to a far-sighted, holistic approach to manufacturing’s tech-enabled metamorphosis—one that has served it well in over the past eight years.

The background: The 4.0 movement started in Germany in 2011 when the German ministries for education, research, economic affairs and energy developed a strategic initiative that would push forward the digital transformation of industrial manufacturing.

• They named this initiative Industrie 4.0. It featured an action plan that combined policy initiatives, public–private funding, strategies for technology implementation and the identification of business drivers and barriers.

The difference: For the MLC and its members, Manufacturing 4.0 is made up of transformations in three different arenas: technology, organization and leadership.

• Contrast this with Industry 4.0, which covers only technology topics—specifically nine pillars of technological innovation, which include autonomous robots, big data, cloud computing, IoT, cybersecurity, systems integration, simulation, AR/VR and additive manufacturing.
• “MLC, of course, covers all of these technologies, but, importantly, adds the dimensions of organizational and leadership change as part of its perspective on manufacturing’s digital transformation,” says David R. Brousell, the MLC’s founder, vice president and executive director.

MLC in action: While the MLC does provide member resources that focus on specific technologies and their uses in manufacturing operations, it also covers topics such as how leaders can prepare their workforce for digital transformation, how organizations should be structured to make business decisions based on manufacturing data and how leaders can ensure they set their teams up for digital success.

• Additionally, the annual recognize not only high-performing digital manufacturing projects but also outstanding individuals who demonstrate both technological understanding and strong personal leadership.

M4.0’s continued evolution: Today, the MLC continues to use Manufacturing 4.0 as the overarching framework for its member companies’ activities.

• Its influence is apparent in the MLC’s annual , a member-created list of key business drivers and enablers of digital manufacturing.
• The agenda covers technological advances like smart factories and data analytics, alongside the organizational ecosystems that put such advances into operation—from the leaders who direct them to the cultures that make them succeed.

The Future of M4.0: As the MLC gets ready to set its 2023–2024 Critical 51�Թ��� Agenda, it will continue to take a holistic approach to the technological changes sweeping the industry by recognizing the importance of people in making those transformations happen.

Go deeper: You can learn more about Manufacturing 4.0 by downloading the MLC’s white paper, ; reading a recent report, ; or attending its Aug. 30 virtual Executive Interview, .

With one of its key components—printed circuit boards—in short supply, Schweitzer Engineering Laboratories chose the proactive solution: it would begin making them itself. Now that its new factory is up and running, SEL is receiving unexpectedly keen interest from other companies, and considering ramping up production for outside sales.

Fixing a supply chain problem: The Pullman, Washington–based electric power system protection solution manufacturer began manufacturing PCBs at its new $100 million, 162,000-square-foot factory in Moscow, Idaho, back in March.

• “Printed circuit boards take electronic components and interconnect them so they can interact with each other,” SEL CEO David Whitehead said. “Without them, you can forget about AI, forget about your cell phones—they’re in just about any electronic device.”
• The Moscow factory is running at about 25% capacity. When it reaches full production later this year, it will be one of the top PCB manufacturers in the U.S., according to Whitehead.

Domestic and accessible: The PCB “is a critical component that goes into our devices,” Whitehead continued. “Now, instead of sourcing PCBs from around the U.S., we can produce them ourselves.”

• The Moscow facility—which only produces the circuit boards for SEL—has increased the company’s supply chain resiliency and sped up its output, Whitehead told us. “Now, in a handful of days after designing a printed circuit board for a product, our engineers are in their labs testing it. It’s a big win for us.”
• Nearly half of manufacturers in the U.S.—44.9%—cite supply chain hurdles as one of their top business challenges, according to the 51�Թ���’s Q2 2023 Manufacturers’ Outlook Survey.

Self-funded and viable: SEL funded 100% of the facility’s construction costs, and it will have paid for itself in two to three years, Whitehead said.

• “I think that’s really a big deal for not only taxpayers but the local community generally,” he said. State and local governments “can take the funds [they didn’t use on us] and invest” elsewhere.

A good neighbor: The Moscow plant—which features a fume scrubber system that exceeds Environmental Protection Agency standards for volatile organic compounds—also uses a “zero-liquid discharge water treatment system that recycles and reuses all the water used to manufacture the printed circuit boards,” Whitehead said.

• A comparable factory would use about 90,000 gallons of water each day of production, while SEL uses about 500 to 600 gallons—the equivalent of only a few households’ daily usage, according to Whitehead. Most of that is for worker needs (drinking water and restrooms).
• The company also reclaims and reuses metals, such as tin, silver and gold, that are used in the production process.
• “We are very environmentally conscious about how we produce these boards,” Whitehead said.��

What’s next? Since the facility began production, SEL has gotten numerous inquiries from other manufacturers interested in buying the PCBs. The company is likely to oblige them soon.

• “This is our next opportunity,” Whitehead said of producing boards for other manufacturers. “We love being vertically integrated, building as much as we can close to where we’re going to use the products. … As we get better at it for our own consumption, I can see us expanding it.”

Discipline, reliability, a team-player mindset, leadership—manufacturers are looking for all these qualities in the talent they recruit. What if companies could tap into a population not only equipped with these skills but experienced in using them in high-stakes situations?

Well, the Manufacturing Institute—the workforce development and education affiliate of the 51�Թ���—has good news, if you haven’t heard it already: this population exists, and it’s military talent. Transitioning service members, veterans, National Guard members, reservists and military spouses have a wealth of skills and experience that translate easily into a manufacturing context.

So how can manufacturers reach these workers and make the best use of them? The MI recently convened both military and manufacturing leaders in Fayetteville, North Carolina, for its third Workforce Solution Series event, where they answered this question and offered a range of useful advice. Here are some of the highlights.

Generally speaking: Major General Eugene J. LeBoeuf, Deputy Commanding General, U.S. Army Reserve Command, highlighted the talents and skillsets that Army reservists can offer the manufacturing industry, including agility, a can-do attitude and a thorough grounding in engineering, logistics and mechatronics.

• With nearly 190,000 soldiers, the Army Reserve comprises much of the readiness force of the U.S. Army. Many of these reservists are underemployed or unemployed, which means they represent an opportunity for manufacturers.
• Manufacturers interested in hiring from this labor pool can partner with the , which connects companies with reservists at no cost.

Reaching military talent: Several panelists emphasized the importance of developing recruitment processes that encourage military talent to apply and interview for manufacturing jobs.

• “Make sure that the requirements you’re listing in your position descriptions are actually required. Do you really need someone to have a master’s degree to get the job done?” asked Rob Patton, vice president of Fayetteville Cumberland Economic Development Corporation.
• As a recently transitioned service member, James Goppert, HR business partner at WestRock, explained some of the challenges that military talent may face when entering the workforce. “Having to explain military skills and certifications to a civilian in an interview was strange. It would have been helpful to have someone on the other side who understood my experiences.”

Open to all possibilities: Jennifer Goodman, senior manager of talent initiatives at Coca-Cola Consolidated, drew on her experiences as a military spouse. “Military spouses are 92% women and have a 22% unemployment rate. That’s a huge labor pool that’s going underemployed or unemployed.”

• While relocation is often a concern for companies, Goodman points out that it does not have to be a disadvantage. “Think of manufacturers who have locations across the country. Maybe you can start a military spouse at one location and then move them to another. Or, if they’ve proven themselves after a few years, you could transition them to remote work.”
• “The benefits don’t stop with the one military spouse you hire,” she added. “We’re a very loyal community with great word of mouth and a larger referral network.”

The last word: “Don’t underestimate the value of an event like this Solution Series can have. You can take the information, energy and passion that you get from meeting with people who have the same goal of building a stronger economy and use it to power you forward,” said Nathan Huret, economic development director for Catawba County.��

Learn more: To get started—or continue—with hiring military talent, check out the extensive resources of the MI’s initiative, which prepares prospective military workers for new and rewarding careers in manufacturing.