Why Government Spending On The Manufacturing Industry And Where Should The Money Go?

American manufacturing Training

Keeping Innovation in America

Whenever I ask why money is taken out of a paycheck for taxes I am told a few different answers: “It goes into a social security fund for you later in life”, “it goes to help re-build roads, bridges, law enforcement, etc. etc. to help maintain a safe society”, and “towards providing healthcare for those in need”… all great things that I am more than happy to invest in.  Recently, there has been an abundance of government spending of tax dollars towards manufacturing, so I reach out to the masses and ask why it is necessary for this to occur? 

Now, my questioning is not for a lack of willingness to help re-grow our economy, and is probably more for my lack of knowledge that I ask why is it necessary for the government to take so much money to put into these industries.  ITIF President, Robert Atkinson, addresses the starting point of Why We Need a National Manufacturing Technology Strategy.  It is unclear whether or not he supports the spending, but his article does address my question, more from an economical side.  He brings up a main point that the focus lies upon innovation and key technologies.  So what does this mean from strategic spending?

Atkinson announces his general claim that the manufacturing sector does need to be restored in order to compete with the low-wage companies in order to reduce trading deficits, but gives no real insight into how.  President Obama addressed and stressed the idea of training and education to help keep innovation within the U.S.  During a speech at North Virginia Community College he stated, “The irony is even though a lot of folks are looking for work, there are a lot of companies that are actually also looking for skilled workers.  There’s a mismatch we can close.”  I completely agree.  Rather than putting all of our eggs into a select few baskets, we should look to focus on the lack of skilled workers.  Looking into the labor pool might be a great starting point.  If we are able to invest into training them to complete higher-level jobs, we could create a core structure that would establish a strategic starting point.  Currently, manufacturing companies are avoiding this track and, instead, are investing in capital equipment and automation to reduce the dependence on the skilled workers.  For now, it seems like a logical step, but maybe it would be more beneficial in the long run to use that money towards new hires in trade positions.

Straight from our President, “…we know that we’ve gotta rebuild the middle class and a lot of that’s going to have to do how well we do in manufacturing and how well we do in jobs that are related to making products here in the United States of America.”  Obama reiterates that there is a lot of untapped potential which could very well lead to a revamp in the underlying foundation of our economy.  Government involvement will help bridge the gap and allow manufacturers to fill important voids without having to make costly investments into training.  Meanwhile, these new jobs can help reduce unemployment and give the economy a boost.

Posted by Jason Rourke, Marketing Manager, ProfitKey International

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