Viewing blog posts written by Ashley Hong


Pay attention to manufacturing in the climate debate

Posted by Ashley Hong, Policy Intern on Aug. 26, 2016

In the wake of the Legislature passing new climate change bills this week, Governor Brown was asked about the impact on jobs. Part of his answer was “Manufacturing has been declining as a part of the American workforce for decades, and the decline in America generally is very similar to California.”  

Manufacturing is actually thriving in the United States.  Companies are increasingly choosing to relocate to the US due to wage growth in developing countries, logistical concerns, and poor intellectual property protection outside the US. It’s a good thing, too, because the direct jobs and ripple effect of manufacturing in the broader economy makes the US a powerhouse nation. A recent study by the MAPI institute showed that each manufacturing job supports a whopping 3.4 other non-manufacturing jobs.  

While the US as a whole is becoming more attractive to manufacturing than in prior decades, we have work to do in California. CMTA tracks manufacturing jobs and investment data in California compared to other states.  Since the recession ended in 2010 we have seen only slow job growth in California while other states are enjoying the boom.  In 2015, California had the lowest rate of all states for manufacturing investments for expansions or new sites. We haven’t received more than two percent of total US investments since the year 2000. That is far short of the 11 percent we need to attract each year to maintain our share of US manufacturing GDP.

It’s impossible to attribute any single state policy, even a big one like climate change, to any particular job growth or loss.  Many costs of doing business, litigation risks, and permitting challenges discourage investment and job creation in California.  But that shouldn’t give lawmakers a pass to not consider economic impacts when they adopt climate change policies. This is especially true when success depends on other states, who want to preserve their strong manufacturing economies, being willing to adopt similar policies and making meaningful reductions in global climate emissions.   

California voters support climate change laws but also want to protect manufacturing. In a recent poll by the California Business Roundtable, when asked if they support new climate change regulations the answer is a resounding “yes.” But when asked if they would support these policies if middle-class manufacturing jobs would be lost, 66 percent said they opposed.  

Reasonable regulations can be developed to achieve both environmental and economic goals for California.  Manufacturing jobs in California produce greener and cleaner products for the world.  It’s good policy and good politics to make sure manufacturing, in particular, is part of the climate change agenda. 





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MFG workers at CMTA's next Champion company say it all!

Posted by Gino DiCaro, VP, Communications on Aug. 18, 2016

Two comments we heard this week from long-time employees at a Valley manufacturer exemplify how California manufacturing is blistering through new innovations and technologies for very traditional manufacturing processes and providing tremendous opportunities for workers.

The employees work for our next Manufacturing Champion company to be announced in October on #MFGday16 and in our annual magazine. 

The quotes were so good, we thought we’d share in anticipation:

“We appreciate the opportunity to learn new skills. Not long ago, for example, the company sent me along with a team of engineers to Ohio to learn about the robotic welder. After I came back I handled all of the electrical for it. Since then, we’ve added new presses, modified other machines, and upgraded other technology. We’re not stagnant or set on one direction. We’re always innovating.”

"There’s no lack of improvement here. We’re always thinking of ways to make better use of our time and improve our productivity. I’m always adapting and learning, and learning from other employees.”





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California export growth not catching up with country

Posted by Gino DiCaro, VP, Communications on June 10, 2016

Manufacturers know that exporting is one of the primary growth factors for any economy and that it is profitable for businesses of all sizes. According to a study published by the Institute for International Economics, U.S. companies that export not only grow faster, but are nearly 8.5 percent less likely to go out of business than non-exporting companies.

About a decade ago California, for the first time, got passed in total exports by Texas. The general slowdown in the Golden State started in 2000 but has continued over the last 15 years.  According to U.S. Department of Commerce data, we lag the country's export growth by a large margin. California was by far the export leader in the second half of the 20th century. Now 16 years into this Century we have less than 40 percent export growth compared to the rest of the country's 92 percent growth. For many reasons, other states are attracting more manufacturers who export goods. Our policymakers in California should use this as another reason to ensure we're doing all we can to attract our share of manufacturers.

 

Export growth image





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Innovation in manufacturing can improve sustainability

Posted by Gino DiCaro, VP, Communications on May 6, 2016

A blog cross posted from the National Association of Manufacturers and Mallory Micetich:

Here’s a great example of how innovation in manufacturing can improve sustainability and our world. Exxon Mobil is investing in FuelCell Energy, a company developing technology that could reduce carbon dioxide emissions from power plants. As the New York Times reports, Exxon Mobil hopes that their relationship with FuelCell will allow them to take a promising new approach to carbon capture and sequestration “from the lab to the market.” This technology could potentially mean that power plants could “isolate and compress” CO2 “while producing enough power to more than make up for the energy cost of capturing the carbon.”

Read more about how FuelCell and Exxon Mobil’s partnership could help power plants reduce emissions.





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More pieces of the California manufacturing jobs story

Posted by Gino DiCaro, VP, Communications on April 15, 2016

There were some independent items worth noting in the California manufacturing employment narrative this week.

First the California Labor Market Information Department, in its monthly report this week, announced the loss of 1,600 manufacturing jobs in March. This decline brings California’s manufacturing jobs growth to 3.4 percent since the recession, while the U.S. grew its manufacturing base by 7.4 percent.

In the same week came an announcement from a southern California manufacturer, General Magnaplate, who said they would be shutting down their manufacturing facility in Ventura because of a difficult business climate and an unwarranted stormwater lawsuit against them. Magnaplate is a small manufacturer with only around 25 workers in their Ventura facility, but that means nothing to their employees who are left looking for work. The good news is that families in Texas and New Jersey will likely gain employment because the company’s facilities in those locations will pick up production. Just one example of the drips of manufacturing loss accumulating over the years in California.

With some of this bad news came good news, at least you’d think. The Advanced Energy Economy (AEE) Institute released a report this week indicating that the “Advanced energy” sector generated jobs at six times the rate of the overall California economy last year. The good news stops there. The problem is that often those jobs are coming at the expense of reduced job growth and investment in other areas of the economy.  If we are spending too much for those jobs then we incur even greater losses in the rest of the economy. The report even admits it on page 6: “California’s advanced Fuel Sector was the only segment of Advanced Energy that did not create additional jobs in 2015.  Challenged by several factors including persistently low gasoline prices, Advanced Fuels saw employment decline more than 50 percent from 2014, resulting in a loss of about 8,300 jobs.

Basically the AEE report tells us that if you raise prices on something you can get more people working on ways to reduce consumption. That is of course not a surprise. But when it comes to the entire economy, our collective data is telling us that our state is still lagging the country in manufacturing jobs and investment growth.





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