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Establishing plants: Important as innovation

Aug. 1, 2010
This year's International Manufacturing Technology Show (IMTS) will kick off with something new Industry Inspiration Day on September 14 and it couldn't

This year's International Manufacturing Technology Show (IMTS) will kick off with something new — Industry Inspiration Day on September 14 — and it couldn't come at a better time. Experts in aerospace, medical, automotive, and energy industries will lead sessions on manufacturing innovation and technology advances. Something else I hope they'll cover: Keeping the factory jobs that go with these advances here in the U.S.

A recent column in Business Week by Andy Grove, senior adviser to Intel, underscores the importance of building factories in the U.S. after a domestic startup company generates an invention. As the technology goes from prototyping to mass production, companies "work out design details, figure out how to make things affordably, build factories, and hire people by the thousands," says Grove. He argues that this is the very thing that makes innovation matter — job creation — and it's no longer occurring in the U.S.

What's worse, says Grove, is that besides losing jobs to Asia, we're losing "the chain of experience that is so important in technological evolution … abandoning today's 'commodity' manufacturing can lock you out of tomorrow's emerging industry." Two examples are battery technology and photovoltaic panel production. Photovoltaics are a U.S. invention, but manufacturing of the films and solar panels is taking place mostly in Asia; only a few percent of worldwide employment in this industry is in the U.S.

"You could say, as many do, that shipping jobs overseas is no big deal because the high-value work — and much of the profits - remain in the U.S," explains Grove. "That may well be so. But what kind of society are we going to have if it consists of highly paid people doing high-value-added work — and masses of unemployed?"

However, perhaps the future of the U.S. battery industry is not so bleak. Though it's taken a hit since we stopped making consumer electronics, a July DOE press release is encouraging. Until recently, the U.S. produced just 2% of the world's batteries for advanced vehicles — but due to Recovery Act investments, the U.S. will have the capacity to produce 20% of these batteries by 2012 and up to 40% by 2015. In fact, nine new battery plants are opening as a result of Recovery Act funds, and 21 existing plants will make battery or electric-vehicle components.

Let's duplicate this success: If the government — by funds or by manufacturing-friendly policies — helped other industries with both R&D and the scale-up phase of promising new technologies, our technical future could look a lot more promising.

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