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Posted on Thu, May 13, 2010 : 1:57 p.m.

Investment in education would reverse U.S. manufacturing contraction, experts say at University of Michigan

By Nathan Bomey

National engineering experts said today at the University of Michigan that the U.S. needs to foster a more educated workforce that can ultimately persuade companies not to offshore production.

The engineers and industry leaders are gathered for the National Academy of Engineering conference to discuss ideas for saving America’s manufacturing sector.

Sridhar Kota, assistant director for advanced manufacturing for the White House Office of Science and Technology Policy, said tax incentives are not enough to preserve the country’s manufacturing heritage. The U.S. must maintain a skilled advanced manufacturing workforce and vibrant industry supply chains, he said.

“You can reduce the taxes to zero, but you still won’t be able to make it because there’s no infrastructure or knowledge base to produce it here,” said Kota, a U-M engineering professor.

National Academy of Engineering President Charles Vest, former president of the Massachusetts Institute of Technology and former dean of U-M’s College of Engineering, said that when U.S. companies offshore labor, technology clusters gradually form in those foreign markets.

Stephen Forrest.jpg

Stephen Forrest, U-M's vice president for research, said the U.S. is "not too big to fail."

File photo |

“We’ve moved into an era in which innovation and manufacturing are now interrelated,” Vest said. “Innovation and manufacturing begin to interact, so when you move manufacturing overseas, expertise begins to build and the next thing you know, the innovation begins to happen there.”

Vest said the U.S. needs to develop new skills in operations engineering and sustainability sectors to revitalize its manufacturing sector. But the U.S. “remains the most innovative country on the planet,” Vest said.

That innovation is often quickly shipped overseas, however. In the mid-1990s, for example, the U.S. had a 45 percent market share in solar panel production, Vest said. Today, that figure has slipped below 10 percent.

“To live well, a nation must produce well,” Vest said, reciting the oft-quoted conclusion of an MIT report from 1990. “Is this still true today? I believe it is.”

Stephen Forrest, U-M’s vice president for research, said America is “not too big to fail.”

“All our economic advantages we have in this country are temporary. We still are an economic engine for the world. We have many innovations and ideas. Well, there are other countries that do that, too,” Forrest said. “We have ideas, we have capital and we have tolerance for failure. Tolerance for failure is a really important thing because it means you’re encouraged to take chances, and if you fail, it’s OK.”

Despite that entrepreneurial attitude, Forrest said a lack of political commitment to education, particularly within Michigan, was concerning.

“Where do they want to spend their money? It isn’t in education,” Forrest said. “We have to struggle with that rather grim piece of information and still succeed. To move on from our current status, we should be investing heavily in education.”

Contact's Nathan Bomey at (734) 623-2587 or You can also follow him on Twitter or subscribe to's newsletters.


Basic Bob

Fri, May 14, 2010 : 6:56 p.m.

US engineers are undervalued by our society. People who get engineering degrees are encouraged to get an MBA or a PhD so they can manage or teach. In China, the best young engineers go to work in manufacturing. In the US, we take skilled electricians and mechanics, give them a computer and call them engineers. Some are quite good, but do not benefit from a rigorous education. Somehow we need to encourage the engineers we are graduating to apply their education and develop their skills through experience. Then we have an equal footing to compete with other countries.


Fri, May 14, 2010 : 8:01 a.m.

In all my years at Chrysler, never did we outsource to some cheap, asian country because we felt they were more educated. It was because the labor cost was incredibly cheap and they were uneducated. Tarriffs to ensure jobs are kept (and added...) are required for the manufacturing center. When the US has safety standards, environmental standards, building standards, health insurance, high taxes, and everything else that don't exist in some of these foreign, cheap labor countries - we need tarriffs to level the field and make sure our society is protected. Bottom line.

Jim Mulchay

Fri, May 14, 2010 : 6:58 a.m.

I'd say the best investments we (in Michigan) can make in higher education is to (1) properly fund out public school systems and (2) make sure our public colleges and universities are affordable to to Michigan families; More money for public colleges at the expense of our public schools is not an answer for a better Michigan work force. Build the basic reading, writing, math, thinking and speaking skills early - with those basic skills the students are ready to advance to more complex subjects.


Fri, May 14, 2010 : 6:30 a.m.

It was Dr. Noel Tichy, not Dr. Neal Tichy, who was among the architects of the destruction of our industrial economy in order to build a freebooting corporate executive economy.


Fri, May 14, 2010 : 6:01 a.m.

As usual, the people of Michigan understand the manufacturing problem better than think-tanks and academia. And for that matter, they understand it much better than shareholders of off-shoring companies - who listen to think tanks and academia. The decision makers, unfortunately listen to academics as they parrot the dogma of UM's Dr. Neal Tichy and CAR's Dr. David T. Cole, and the media present their self-serving tripe as what must be. Academia such as UM and MIT are not the answer, in fact, they're a major reason for the collapse of manufacturing - they've replaced skilled men and women with disaffected theorists, and they've turned innovation and entrepreneurship into a tax-funded, closed-shop owned by UM, leaving little room for those who pay the bills but can't compete with the growing tentacles of the UM. Ann Arbor is far from unique, I was raised in Madison and the UW is grasping and grabbing everything around it, too. They also have a Dr. David T. Cole in the mix, Dr. Marv DeVries - world renowned expert on manufacturing and former national SME chairman. Wisconsin's manufacturing has gone the way of Michigan's - due largely to the UW's expert guidance, while they gobble up all the grants and for-profit business opportunities from others. Manufacturing is a key part of an economy, but the UM has said and their actions prove that it's not what the State of Michigan can afford or wants. Put bluntly, UM economists said in 2004, and Gov Granholm eagerly supported it, that the sooner manufacturing gets out of the state, the sooner Michigan can start growing economically. Now they change their tunes - shedding their skins, as it were. But they're unchanged inside and grabbing opportunities from others, which is their normal way of doing business.

Left is Right

Thu, May 13, 2010 : 9:54 p.m.

I agree with the sentiment that we somehow have a failure in education. Institutions of higher educationespecially our universitieshave sold the American public a bill-of-goods in that they almost insist that the only path to enlightenment is through them. Americans are buying it. And paying for it. And borrowing for it. And paying for it. In the meantime, our public secondary schools, falling prey to such hyperbole, have eliminated traditional vocational tracks. No need to be a machinist. Welding? Thats for the Chinese; we have a knowledge based economy. Lets prepare the next generation of pysch and poli sci majors. Theres no demand for training to actually make stuff. Besides, we can save some money by eliminating these expensive programs that only benefit students who are not college bound. Well, Im not buying it. And Im faculty at a local scion of higher education. We need good welders, good machinists, people who have the skills to actually build stuff, not just think about what needs to be built. We have an incredible breadth and depth of such skills in Michiganand as well in many manufacturing statesand yet we neglect to recognize and develop this resource. Short-term their compensation is uncompetitive and yet long-term we cannot afford to lose them. Maybe we need to re-educate our business schoolschange the focus from managing for shareholder value to managing for real shareholder value. I have always said to my kidsor maybe it was vice-versathat education is a lifelong endeavor. Its personal. It doesnt end when formal schooling is done. UM, EMU, MSU, MIT, and Harvard (maybe even Stanford) are great for some things. But they are not great for everything. If they cannot give you what you need, find it someplace else. We seem to be running low on those someplace elses.


Thu, May 13, 2010 : 6:06 p.m.

Hmmmmmmmm, in NJ in the last 8 years student population has grown 3% while education jobs have increased by 16%. Despite that increase SAT scores have not increased in NJ. The reality is throwing money at the issue will not solve it.


Thu, May 13, 2010 : 4:24 p.m.

I think the bigger problem is that we need more engineers/scientist/chemists etc. graduating. For the U.S. to compete we need technically skilled people to innovate and outproduce the world. The top 2 majors at UM are Psychology and Political Science, I fear that the U.S. will lose its technical edge.


Thu, May 13, 2010 : 3:14 p.m.

The University of Michigan, Michigan State and Wayne State are among the top 50 research universities in the US. Yet we are at risk of losing a fundamental competitive advantage. Michigan is the only state in the union with negative growth in higher education appropriations in the past five years combined. Since 2001, per student state funding has declined a bit more than $2,800 adjusted for inflation. State spending on prisons now exceeds spending on higher education.