Manufacturing was for decades the backbone of North Carolina’s economy. These days, a casual observer might conclude that its time has come and gone.
In the recent recession, it is estimated our state lost 115,000 manufacturing jobs.
North Carolina employs approximately 430,000 people in manufacturing – down 38 percent since 2001. The rate of the decline is the highest in the Southeast and is greater than the nation as a whole.
This spiral has been led by the flight of low-skilled jobs to low-wage countries and the technological shift from workers to machinery. The consequence: four of our major industries – textiles, textile products, apparel and furniture manufacturing – have accounted for more than half of our net loss of manufacturing jobs.
Even so, manufacturing remains the top contributor to North Carolina’s gross domestic product while producing 84 percent of our state’s exports.
It also pays better than non-manufacturing jobs – with average annual compensation around $53,000. Last year, our manufacturing output was $88.35 billion, making us the fourth most productive manufacturing state in the U.S.
Given the critical nature of this sector to our economy, there is good news emerging. For the first time in 16 years, 2011 saw an increase in net manufacturing jobs here – a trend that is continuing, according to the latest Bureau of Labor Statistics report.
The fuel behind this turnaround has been our ability to pivot away from labor-intensive, low-skilled manufacturing into advanced, skills-based production.
Twenty years ago, 50 percent of our manufacturing jobs were in tobacco, textiles, and furniture. Today 80 percent of our manufacturing jobs are coming out of pharmaceuticals, aviation, transportation, and electronics.
Addressing the skills gap
This is not by accident.
We have strategically and actively developed and recruited new industries to our state. Companies have also successfully made the shift to advanced manufacturing, reporting higher output, better product, less waste and higher profitability.
This has led to more investment. Owens Corning, for example, just announced a $120 million advanced manufacturing facility in Gastonia that could produce 110 new jobs.
Jacob Holm Industries, a non-woven manufacturer, recently announced its plans to invest more than $45 million over the next three years expanding its Buncombe County plant, creating 66 new jobs. Indeed, according to a recent survey by the North Carolina Advanced Manufacturing Alliance, 92 percent of advanced manufacturing companies reported they would be making investments in new technology in the next three to five years.
But can our state’s workforce keep up with these investments? In the same survey, 93 percent of advanced manufacturers reported a skills gap in potential employees especially in science, technology, engineering, and math (STEM) – hindering their ability to hire.
To address this gap, the North Carolina Advanced Manufacturing Alliance was formed by 10 community colleges.
Its stated goals: Speeding up the time it takes for students to obtain an industry-accepted credential and then working with industry to help them secure permanent jobs.
An $18 million grant from the Department of Labor has accelerated this relevant job training by helping participating community colleges equip their schools with state-of-the-art advanced manufacturing technology.
Tommy Evans, for instance, began working at Hillshire Brands in Tarrboro as a machine operator and wanted to brighten his job prospects. So he enrolled at Edgecombe Community College to get an associate’s degree in Industrial Systems Technology.
Attracted by a robotics class this fall, Evans jumped on it, saying, “Hillshire Brands has robotics features in place and they should have more in the future… (this will) definitely give me a leg up.”
Lenay Huskey is a military spouse who wanted to get practical skills to increase her employment opportunities.
So this fall she enrolled in Fayetteville Community College’s Computer Integrated Machining program – helping her develop highly portable skills in a field that has a significant shortage of skilled workers.
At the Institute for Emerging Issue’s spring forum @Manufacturing Works, three key recommendations were offered to help us compete as a state: align manufacturing needs with education (especially STEM preparation); develop a long-term infrastructure plan to facilitate export; and rebrand manufacturing as a career option.
We’d like to propose a fourth: creating pro-active policies that incent further investment in our factories and our workforce.
Manufacturing in the Tar Heel state is on the rebound after a lot of tough years.
But as it reinvents itself, so must we. This requires re-imagining what manufacturing is and what it can be – and equipping our next generation to be productive with their hands and their minds.
Christopher Gergen is founder of Bull City Forward & Queen City Forward, a fellow with Fuqua’s Center for the Advancement of Social Entrepreneurship at Duke University and author of “Life Entrepreneurs.” Stephen Martin, a director at the Center for Creative Leadership, is author of “The Messy Quest for Meaning” and blogs at www.messyquest.com. They can be reached at email@example.com and followed on Twitter through @cgergen.