Making a Difference: Manufacturing Offers a World of Possibility to the United States

  • October 07, 2022
  • Opinion
Making a Difference: Manufacturing Offers a World of Possibility to the United States
Making a Difference: Manufacturing Offers a World of Possibility to the United States

Manufacturing today is not your grandparents’ industry. Or even your parents’. Indeed, if they were able to travel through time and step into one of today’s great American factories, they would be bewildered.
Visit any modern manufacturing site, as I often do, and you're likely to see bright and airy workplaces. New and exciting technologies are humming. Hardworking teams, some of them dressed head-to-toe in white gowns, collaborate side-by-side.  Innovation occurs in real time and with real impact. It’s all a far cry from the loud (and often rather macho) assembly-line work that characterized much of the 20th century. Instead, America’s best manufacturers—what I call the Titanium Economy—are forward-thinking, digital, diverse, creative and profitable.
And all but unknown. Their work is essential to the US economy, but they go uncelebrated. Wall Street is largely indifferent—industrial technology gets only about one percent of venture capital—and outside their hometowns, the public has never heard of them. We make a big deal of new smartphones, while forgetting the thousands of small parts that make them so powerful . . . and the companies that are behind those innovations.
A mechanical engineer by training, I came to the United States in the mid-1990s eager to participate in the growth of this country. I lived in Cleveland and worked for industrial clients in the Midwest. Many of my friends were working in Silicon Valley, but I loved what I was doing in industrial technology, and I saw something that felt real, important, and underappreciated. I still feel that way—if anything, more strongly. On National Manufacturing Day, I want to do what is rarely done: recognize these industries.
Why do they matter?

They are attracting new talent

Industrial employment is rising, from 11.6 million in January 2011 to 12.5 million in October 2021, much of it coming from vocational and community colleges. To realize the sector’s potential, though, we need more.  Every single industrial leader I have spoken with identified labor shortages as an impediment to growth. We need help from policymakers, in the form of investment in infrastructure and training, and we need a change in mindset. To paraphrase one CEO of a Titanium Economy company, there are many two- and four-year college graduates who wouldn’t even consider a factory job.

They are creating economic opportunity

Against a backdrop of growing inequality, manufacturing offers a pathway to economic security, particularly to those who choose not to get four-year college degrees. The manufacturing sector offers well-paying jobs—the median annual pay is $63,000, compared to $30,000 for service jobs—as well as real career development opportunities and a culture of purpose. In addition, having a critical mass of manufacturing brings in other players to a community—what my colleagues and I call the “Great Amplification Cycle.”

They are solving difficult problems

The products that manufacturing companies make enable the creation of other products and services. They’re also critical to our ability to find solutions to many of the problems we face, from tackling climate change, to creating a more sustainable and reliable food system, to restoring and upgrading infrastructure. Trex, for example, saves 1.5 billion plastic bags from clogging landfills and waterways every year. BHS converts what would have been food waste into compost, using machinery designed by Scott Equipment Company, another Titanium Economy company.

Just as it was in the 20th century, manufacturing today is full of possibility. It looks different–and that’s a good thing: today’s factories are far from the “dark, satanic mills” of the early Industrial Revolution. In fact, Titanium Economy companies stand out for their ability to change, quickly and effectively.
On National Manufacturing Day, let’s recognize manufacturing and all its contributions—and commit to doing the work we need to do to ensure these opportunities are available for the next generation.

About The Author

Asutosh Padhi is a senior partner and the managing partner for McKinsey & Company in North America He is the co-author (with Gaurav Batra and Nick Santhanam) of The Titanium Economy: How Industrial Technology Can Create a Better, Faster, Stronger America (Public Affairs, October 2022).  

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