Archive for the ‘Manufacturing’ Category

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#FDIintheUSA: Nearly 7 Million American Jobs

September 7, 2017

By Elizabeth Schaefer, Director of Investment Analysis, SelectUSA

As Director of Investment Analysis, I am responsible for leading SelectUSA’s data evaluation efforts related to foreign direct investment (FDI) promotion in the United States. So, it was with great interest (and I’ll admit excitement) that I reviewed the newly released preliminary 2015 and revised 2014 FDI activity data from the Bureau of Economic Analysis (BEA), which follows the July release of 2016 FDI Inward Stock data.

You may be asking, “What does this mean?” Here’s the breakdown…

The updated data provides a picture of the inward flow of FDI into the United States, as well as the economic activity of U.S. affiliates of foreign-owned firms, from employment figures to research and development (R&D) spending. Overall, the numbers reflect continued, steady FDI growth in America.

But as always, it makes the most sense to start at the beginning.

FDI Definition and Parameters 

FDI, as defined by BEA, generally captures a long-term relationship with the management of a foreign enterprise, which is usually linked with the real output of the country in which it operates. In other words, FDI refers to businesses based in other countries and markets.

At the end of 2016, FDI stock (the total amount) reached $3.7 trillion, a 12.8 percent increase from the revised $3.3 trillion 2015 end-of-year figure. This year, on-year growth outpaces the trend in FDI stock growth over time. On average, during the last five years, FDI stock has grown nearly 9 percent each year.

Sources of Inward FDI Stock 

Sources of Inward FDI Stock

The latest available 2016 data show continued strong investment relationships with the United Kingdom, Canada, Japan, and Germany, all of which are historically large sources of investment into the United States. In fact, these top four sources of direct investment alone account for nearly half of all FDI in the United States. However, compared to the previous year of available data, this concentration has slightly dissipated, with economies like Ireland and Switzerland gaining overall shares of U.S. FDI.

The top four fastest-growing sources of FDI in the United States, calculated by looking at annual growth rates since 2011, are Thailand, Argentina, China, and Singapore. In contrast to the largest sources of investment, these top four relatively new sources of investment make up less than 4 percent of total FDI stock in the United States.

It is important to note that these figures attribute FDI ownership to the market at the top of each investment’s ownership chain – the ultimate beneficial owner or “parent company” – rather than capturing investment passed through intermediate markets via subsidiaries.

Industry Destinations of Inward FDI Stock 

Industry Destinations of Inward FDI Stock

The latest available data continue to show enduring ties between FDI and the manufacturing sector. Manufacturing industries attracted an incredible 41 percent of the FDI pie at the end of 2016. Diving a bit deeper, the chemicals, transportation equipment, food, and machinery manufacturing industries captured 64 percent of manufacturing FDI. Looking at year-on-year changes, the professional, scientific, and technical services sectors experienced dramatic growth, increasing in value by more than 28 percent. The diverse mix of industry and sector destinations for FDI in the United States continues to demonstrate that the United States is an important destination and market for globally competitive companies.

Jobs 

Direct Employment by Majority Foreign-Owned Firms in the United States

In 2015, FDI from majority foreign-owned firms was responsible for 6.8 million direct jobs in the United States, an increase of 1.5 million since the end of the 2009 recession. These are high-impact jobs, too; the average annual compensation per direct worker in 2015 was $79,040, almost a quarter higher than the national average.

Other Related Activities

R&D

FDI continues to enhance U.S. global competitiveness by bolstering R&D spending in the United States. The U.S.-based affiliates of majority foreign-owned firms spent nearly $57 billion on R&D activities in the United States in 2015.

Exports

Linkages between trade and investment also remain clear. Exports of goods shipped by majority foreign-owned affiliates declined nearly 20 percent in 2015 compared to 2014. Despite this dip, the $353 billion in goods exports accounted for 23 percent of all U.S. goods exports.

What’s Next?

You can explore this data and more with SelectUSA’s data visualization tool and updated fact sheets at SelectUSA.gov. Additionally, I encourage you to check out #FDIintheUSA on Twitter, our annual campaign that highlights the economic benefits of FDI at the state/territory and national levels through infographics and interactive conversations.

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Helping the American Worker Succeed in a Global Marketplace

September 1, 2017

This post originally appeared on the Department of Commerce blog

labor day graphic

Helping the American Worker Succeed in a Global Marketplace

As we celebrate Labor Day, the U.S. Department of Commerce is proud to express our appreciation for American workers and reiterate our commitment to helping Americans succeed in a global marketplace.  We firmly believe that given a level playing field, American workers can help grow the economy and build a better future for all Americans.

Commerce’s International Trade Administration (ITA) is the premier resource for Americans competing in the global marketplace. ITA strengthens the global competitiveness of U.S. industry, promotes trade and investment, analyzes trade trends and opportunities that help businesses make better decisions and ensures fair trade through the rigorous enforcement of U.S. trade laws and agreements.

ITA offers the expertise needed to connect U.S. businesses with trade opportunities that strengthen their bottom lines and grow jobs here at home. In 2016 alone, we enabled $59 billion in exports and facilitated $5.3 billion in foreign investment into the United States.

From January 20, 2017, through August 29, 2017, Commerce has initiated 58 antidumping (AD) and countervailing duty (CVD) investigations, a 27 percent increase from the previous year, and currently maintains 407 AD and CVD duty orders which provide relief to American companies and industries impacted by unfair trade.

Since President Trump has come into office, ITA has been working hard to fulfill the President’s mission to increase opportunities for American workers. This includes:

  • Fighting for American ManufacturingITA is a leading advocate and ombudsman for advancing the competitive position of U.S manufacturing industries in the global market.  We are ramping up efforts to combat unfair trade practices, intellectual property theft and unfair trade barriers affecting U.S. manufacturing exporters. We provide the data and tools that industry and local government partners need to help companies increase exports, investment and jobs. We also support the negotiation of strong provisions in U.S. trade agreements in key areas, including government procurement, customs and trade facilitation, standards and technical regulations, import licensing, investment, state-owned enterprise behavior, anti-corruption, labor, environment, dumping, subsidies and safeguards. ITA will use its expertise and enhanced data analysis programs to put forth recommendations that will make U.S. companies more competitive and will allow them to support more high-paying jobs here in the United States.

 

  • Empowering American ExportersWith offices in 108 locations across the U.S. and 78 markets worldwide, ITA is uniquely positioned to help American companies overcome the challenges of exporting and capitalize on the opportunities to sell American goods and services around the world. Our team works daily to address the market challenges that U.S. companies – especially small and medium-sized businesses – face when pursuing opportunities in the global marketplace. We provide companies with actionable market intelligence, including practical transactional know-how on the mechanics of exporting, guidance on how to manage and overcome barriers to trade and information on trade financing options.  ITA also provides dedicated advocacy support to American companies competing for foreign civilian and defense government procurements.
  • Fighting Unfair Imports: ITA has a record of accomplishment in delivering timely and responsive relief to American manufacturers and workers from unfair trade and ensuring that U.S. national security interests affected by international trade and investment are vigorously evaluated and addressed. We administer and enforce the U.S. antidumping (AD) and countervailing (CVD) duty laws to defend U.S. manufacturers, ranchers, farmers and workers against injuriously dumped and unfairly subsidized imports. We are steadfast in our work at leveling the playing field through the conduct of these investigations and other proceedings. ITA also provides recommendations and analysis for the Trump Administration of U.S. trade safeguards that protect American industry and jobs. To further strengthen the Department’s abilities to enforce U.S. trade laws, ITA is building capacity to self-initiate trade remedy actions when appropriate.

At home and abroad, ITA works every day to help American workers.  It is our mission and our promise.  Happy Labor Day to everyone!

 

 

 

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Congressional Office Commends e-Commerce Firm During ‘Made in America’ Week for Facilitating Medical Exports

August 1, 2017

Susan Crawford is a Communications Specialist for the U.S. Commercial Service Pacific North Network. The U.S. Commercial Service is the export promotion arm of the U.S. Department of Commerce’s International Trade Administration.

VIA Global Health receives U.S. Commercial Service Export Certificate

VIA Global Health receives the U.S. Commercial Service Export Certificate for their achievements. Pictured from left to right: U.S. Commercial Service Seattle Director Diane Mooney, Rep. Jayapal’s District Director Rachel Berkson, International Trade Specialist Bob Deane, VIA Global Health President Noah Perin, Global Healthcare Team Director Tembi Secrist and Office of Health and Information Technologies Senior International Trade Specialist Gerry Zapiain.

VIA Global Health is filling a gap in the worldwide healthcare market with its innovative e-commerce healthcare technologies distribution platform. Through this platform, the Seattle-based company is addressing the needs of nearly six billion people in emerging markets around the globe.

The firm has worked with its local U.S. Export Assistance Center to more than double its distribution network to cover 21 African and South Asian nations. It recently received a U.S. Commercial Service Export Achievement Certificate in recognition of its success. District Director Rachel Berkson from U.S. Representative for Washington’s 7th District Pramila Jayapal’s local office participated in the presentation.

“Medical professionals in developing countries did not have access to innovative products, and innovators were struggling to sell their devices in these markets,” says VIA Global Health President Noah Perin. “We decided to offer a solution, a global platform that would function like the Amazon of the medical supply world.”

VIA Global Health has more than 160 distribution partners spread across 21 countries in Africa, and also in India and Bangladesh. The e-commerce platform offers medical devices, medical supplies, lab supplies and consumables.

“Exporters supported 375,000 jobs in Washington in 2015 and I commend Via Global Health for creating a platform that enables medical technology manufacturers in Washington and the United States to sell their products in the international marketplace,” Berkson said.

Perin contacted the U.S. Commercial Service offices in Seattle and Africa for help. Perin obtained intelligence on demand for medical technologies in Africa, met with potential distributors in Africa and was introduced to the Washington State Department of Commerce which provided funding for Perin’s participation in two African health expos.

“We’re here to take the guess-work out of selling to foreign markets,” said U.S. Commercial Service Seattle Director Diane Mooney. “We counsel local companies on all facets of exporting, help them determine the best export markets for their goods or services, identify and arrange meetings with potential foreign partners or distributors and assist with removing trade barriers.”

Exporters can access healthcare sector resources from the U.S. Commercial Service Global Healthcare Team and e-commerce best practices from the E-Commerce Export Resource Center. To learn more about exporting, please contact your local U.S. Commercial Service office.

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ITA Illuminates the Path for U.S. Lighting Manufacturers at the Guangzhou International Lighting Expo (GILE) U.S. Pavilion

July 31, 2017

Gary Stanley is Director of ITA’s Office of Materials Industries, Industry & Analysis

Attendees tour the USA Pavilion at the Guangzhou International Lighting Expo (GILE) trade show, where there was record high attendance at this ITA Trade Fair Certified event.

Attendees tour the USA Pavilion at the Guangzhou International Lighting Expo (GILE) trade show, where there was record high attendance at this ITA Trade Fair Certified event.

Chinese customers and U.S. lighting product and service providers flooded the U.S. Pavilion at this year’s Guangzhou International Lighting Expo (GILE) trade show, reflecting the record high attendance at this ITA Trade Fair Certified event. For the U.S. lighting companies exhibiting at GILE, the U.S. Pavilion provided a critical nexus for networking, business-to-business meetings, lighting industry expert presentations on growth segments in China’s lighting market, and ITA export counseling.

U.S. lighting products, known for their quality and performance, are strongly competitive in China. While China’s overall imports of lighting declined at an annualized rate of -5.7 percent during 2011-2016, its imports of lighting from the United States grew at a healthy 2.9 percent annualized rate during this period. The U.S. share of China’s lighting import market has grown from 5.1 percent in 2011 to 7.8 percent in 2016. China reported lighting imports from the world of $2.1 billion in 2016, down from $2.8 billion five years earlier.

The total U.S. lighting export portfolio to the world was $3.1 billion in 2016.  China is the third largest market for U.S. lighting product exporters, behind Canada and Mexico. While China receives only 3.5 percent of overall U.S. lighting product exports, it is a growth market for U.S. exporters.  U.S. exports to China have grown at an annualized rate of just under 4 percent over the last five years. This growth far outstrips the 1.6 percent annualized growth of the $3.1 billion overall U.S. lighting product export portfolio during the same period.

The United States imported more than $11.3 billion in lighting products from the world in 2016, including $6.2 billion from China. China is by far the largest source of lighting product imports with a 55.2 percent U.S. import market share. This market share has remained fairly consistent since 2011, when China held 55.8 percent of a smaller U.S. lighting import market of $7.7 billion. The United States has a trade deficit in lighting products with the world that grew at an annualized rate of 11 percent between 2011 and 2016, standing at $8.3 billion at the end of that period. The U.S. trade deficit with China in lighting products likewise has grown from $4.2 billion in 2011 to $6.1 billion in 2016, reflecting a 7.8 percent annualized growth rate during that period.

Exhibitors presenting in the U.S. Pavilion, including McWong, Luminit and Alpha Assembly Solutions, emphasized Chinese lighting market demand trends that suggest continued strong competitiveness for U.S. products that enable interconnectivity, interoperability, and sophisticated control technologies. American companies can further improve their competitiveness by improving lighting efficiency and power through the use of high-purity materials and precision-engineered materials substrates, both hallmarks of U.S. products.

Additional information on China’s lighting market, other top U.S. lighting export markets and U.S. Government resources available to U.S. exporters is available in ITA’s Top Markets Building Products and Sustainable Construction study.

The U.S. Department of Commerce’s Trade Fair Certification program is a cooperative partnership arrangement between private sector show organizers and the U.S. government to increase U.S. exports and to expand U.S. participation in overseas trade shows.

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Manufacturing and Innovation

October 28, 2016

This post originally appeared on the Department of Commerce blog.

Guest blog post by Laura Taylor-Kale, Deputy Assistant Secretary for Manufacturing, International Trade Administration

As October winds down, I say farewell to Manufacturing Day and what has turned into a celebration of manufacturing and innovation this entire month. Over the last few weeks, I have had the privilege of participating in events in Pennsylvania, North Carolina, and Tennessee to raise awareness about the importance of U.S. manufacturing and the critical role it plays in our economy. The factories and labs that I visited are bringing incredible ideas to the marketplace and beyond. The innovation happening in the manufacturing sector is inspiring – and so are the career opportunities!

manufacturing

Deputy Assistant Secretary for Manufacturing Laura Taylor-Kale Participates in a Manufacturing Day Event at Phononic in Durham, N.C.

Witness the creativity and expansion of ideas generated by employees in both small and large manufacturing companies as well as at Manufacturing USA institutes  around the country.  Innovation and manufacturing are truly inextricably linked.

As President Obama stated in his 2015 State of the Union Address, “Twenty-first century businesses will rely on American science and technology, research and development. I want Americans to win the race for the kinds of discoveries that unleash new jobs.”

In Knoxville, Tennessee last week, I visited Local Motors, an auto manufacturer using 3D printing to make electric vehicles; the Manufacturing Demonstration Facility at the Oak Ridge National Laboratory; and the Institute for Advanced Composite Manufacturing Innovation (IACMI), one of the Manufacturing USA institutes. Local Motors’ innovative technologies used in design and processing builds on scientific research in advanced composites and additive manufacturing at IACMI – and these are exactly the kinds of synergies that the Administration is working to strengthen.

In addition, U.S. automakers and suppliers are investing heavily in new electric technologies and models. Electric vehicle sales continue to grow around the globe and are expected to be 35% of global new car sales by 2040. Since the Chevy Volt, Ford Focus Electric, Tesla, and Nissan Leaf all have assembly, research and development, and inventory processing in the U.S., sales of these vehicles will support the U.S. economy and job creation.

As the White House noted in the Administration’s Strategy for American Innovation last year, “Facilitating exports by innovative U.S. companies means giving them the tools to navigate foreign markets effectively.”  We in ITA’s Industry and Analysis unit help innovators become exporters by offering the Top Market Reports, a set of comprehensive, sector-specific market studies to help firms identify the best markets in which to grow their business. But we don’t stop there. We are proactively moving a trade agenda that advances market conditions to enable U.S. innovators to commercialize products, services, ideas, and business models on an international stage. They will be able to derive full benefit from an equal international playing field and utilize a competitive advantage earned through investments, ingenuity, hard work and sweat.

For instance, we are leading technical coordination to support harmonized standards and regulatory approaches in Asia, a key region of the world for both electric vehicle and auto parts exports, and an area to which we’ll be able to better export under high-standard trade agreements like TPP.

These and other efforts will help ensure that growing foreign markets stay open, thereby helping to ensure the global competitiveness of U.S. automotive and technology companies and to support the growth of manufacturing and innovation at home.  We are proud to support the manufacturing innovators who are shaping the world we live in today and the stronger one we will live in tomorrow.

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Where were you on Manufacturing Day?

October 27, 2016

As we close out Manufacturing Month, SelectUSA is featuring a two-part guest blog from members of the Federal Interagency Investment Working Group (IIWG).  The IIWG is responsible for coordinating activities across federal agencies that promote investment.

Mark Schmit is National Accounts Manager for the National Institute of Standards and Technology’s Manufacturing Extension Partnership. 

U.S. Secretary of Commerce Penny Pritzker was in Portland, Oregon at a Makers Gone Pro Event. Secretary Pritzker spoke to recent high school graduates pursuing technical careers and joined 100 students at the Lam Research Facility, the world’s second-largest semiconductor equipment manufacturer, emphasizing that by 2024, America’s economy will need to fill 2.2 million openings for production workers; half a million openings for engineers; and an untold number of openings for jobs in new, emerging occupations

I was fortunate to be invited to attend How Manufacturing Drives the Economy, an event hosted by the Fabricators & Manufacturers Association, International (FMA) in Rockford, Illinois. Expert panelists highlighted the significant role manufacturing plays in bolstering America’s economy and the critical need to ensure that the sector remains a positive force.

Each panelist asserted that Manufacturing Day (MFG Day) – the 5th iteration was held on October 7th – exemplifies the importance of manufacturing.  Thousands of manufacturers hosted students, teachers, parents, job seekers and community leaders at open houses, plant tours and educational sessions to showcase modern manufacturing technology and the attractive jobs that are available. It was (and still is) a chance for students to see innovative, impactful, durable and diverse career options. MFG Day can also help current students understand how to apply their studies in math and science to those careers. It dispels old, negative myths and stereotypes about manufacturing through highlighting the shift from a labor-intense environment to one of high-tech robotics and computers.

Stephen Gold, President and CEO of the Manufacturers Alliance for Productivity and Innovation, explained that the manufacturing value chain is far bigger than we think, since official government statistics only measure the value of the upstream supply chain and only include goods sold to final demand.  But the downstream chain, from sales to transport to aftermarket services – significantly multiplies this impact.

Kenneth Voytek, Chief Economist for the National Institute of Standards and Technology’s Hollings Manufacturing Extension Partnership program (MEP), shined a spotlight on the metalworking cluster in the upper Midwest. Via the U.S. Cluster Mapping tool, Voytek demonstrated that approximately 70% of the metalworking cluster is agglomerated in the Great Lakes region – no more than a day’s drive from Rockford, where the event took place. Citing MEP data, Voytek noted that workforce development will be the metalworking industry’s greatest challenges for the next three years – from recruitment to growth and continuous improvement. These were more acute challenges for firms this sector when compared to all other MEP clients – but clustering is expected to play a key role in attracting a wider pool of talent.

Scott Mayer, Chairman and CEO of QPS Employment Group, noted that baby boomers are retiring at a high rate, and a new generation of manufacturing workers is needed. However, filling this gap continues to be a challenge, due in part to the fact that there is not enough recognition that the sector supports many good, well-paid, middle-class jobs. Mayer pointed to a need for more “grassroots” efforts involving parents and educators alike to make sure high school students know they have choices beyond traditional four-year degrees. Indeed, many young people may be better suited to skilled trades.

Dr. Chris Kuehl, managing partner at Armada Corporate Intelligence and FMA economic analyst, looked at the significance of U.S. manufacturing from a global perspective. “The manufacturing sector is the dominant player in U.S. exports, particularly with heavy machinery and other capital goods,” he said, “and the U.S. is more export dependent than people realize; it accounts for 14 percent of GDP, almost matching export-driven Japan at its 14.7 percent of GDP. What most people don’t recognize is that the U.S. accounts for 30 percent of all global manufacturing by value. China accounts for only 10 percent.”

The event was, for me, eye-opening and inspirational.  On the return trip to O’Hare International Airport I had time to reflect on all that I heard and how it all fits together.  Resting my head against the window as we rolled east on I-90, I saw the many of the metal working companies that Kenneth Voytek talked about earlier. Many of those companies had an American flag outside their facilities, but it was also obvious that some of those companies represented vital international investment in our country: Amada in Schaumburg, IL is a Japanese company; Bystronic in Elgin, IL is Swiss-owned company; Mazak also in Elgin, IL is Japanese; and Trumpf in Hoffman Estates, IL, is German.

The metal cluster along I-90 in Illinois is grand on an international scale, and manufacturing companies from all over the world want to establish a presence there. They want to be part of the local manufacturing ecosystem and do business in the United States.  Which all begs the question . . .

Where were you on Manufacturing Day 2016?  And even more importantly – where will you be next year?

Follow SelectUSA and MEP on Twitter and join the conversation at #MFGmonth.

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Celebrating Manufacturing Day in Pella, Iowa

October 12, 2016
Jason Andringa, President & CEO at Vermeer Corporation

Jason Andringa, President & CEO at Vermeer Corporation

Guest blog post by Jason Andringa, President & CEO at Vermeer Corporation

Throughout the year nearly 3,000 Vermeer team members work diligently to build impressive equipment that serves ten different markets. Our engineering team works hard to concept and design equipment; our manufacturing team machines, welds, paints and assembles the tough equipment we sell. Our support teams procure parts, integrate technology solutions, market the equipment and build relationships with customers and dealers on six continents. In order to experience ongoing success as a growing global company, we must continue to recruit, develop and build teams that can keep pace with our customer needs.

Numbers prove that a STEM-skilled workforce is essential to the future of manufacturing and our world. Every dollar spent in manufacturing adds $1.37 to the US economy, and every 100 jobs in a manufacturing facility create an additional 250 jobs in other sectors. Yet 80 percent of manufacturers report difficulty in finding skilled workers. Manufacturing clearly has an impact on the nation’s economy. So the skills gap we are facing in our industry has to be addressed in order to achieve a healthy workforce, and is sure to be reflective of the significant need throughout the nation.

Our annual Manufacturing Day event at the Vermeer headquarters in Pella, Iowa has proven to have some of the most positive, immediate results in shifting the manufacturing perception. We invite local middle and high school students inside our doors and break down the myth that manufacturing means a dirty job.

Through hands-on activities and plant tours, students get to dig into all the facets of manufacturing. Paint and weld simulators offer an opportunity to try it out. 3D printing, digital assembly and robotics activities show students manufacturing isn’t an outdated assembly line, but rather a smartly progressive field maximizing science and technology. Finance and marketing activities have students calculate exchange rates and see that manufacturing isn’t limited to a factory, but instead is connected around the globe.

We’re once again preparing to give students an up-close look at what manufacturing is all about. Why? Students, and their influencers, want it. An Iowa Governor’s STEM Advisory Council survey shows that 94 percent of Iowans think STEM education should be a priority in their local school districts. Our Manufacturing Day experience reflects that. Attendance jumped from 100 students to 700+ in just three years.

We also make it a point to survey the students before and after their visit, and are very motivated by the results: The percentage of students who felt they understood what manufacturing is, jumped from 57 percent before Manufacturing Day to 97 percent after, and those who want to work in manufacturing someday jumped from 34 percent to 69 percent. With the majority of students saying that personal experience directs them down a particular career path, we want Manufacturing Day to be one experience that launches them on a STEM journey toward manufacturing!

The future is bright for Vermeer, and when we open on our doors on October 14 for Manufacturing Day, we stand with pride to be a manufacturer and future employer to some of these students who will leave inspired to pursue a career in manufacturing.