Many thanks to Michelle Myhre and Nils Kjell for leading our chapter to 2015 STAR status, and for winning the MOST IMPROVED CHAPTER from 2014 to 2015!
Join your fellow NTMA members from across America at the Fall Conference in St. Louis, MO Oct 20-24.
Sep 23-24 2015: Join us as our NTMA chapter talks about education at the Pacific Coast Machine Tool Expo. This is NOT TO BE MISSED! We'll be holding court with Laney and DeAnza colleges, and also with the CTMAA Apprenticeship program.
If you haven't completed the 2014 Wage & Fringe Survey, please do so now. Your participation is important to this valuable NTMA membership benchmarking tool.
You can access the Wage and Fringe Benefit Survey from the links below:
Please keep the November 1 deadline in mind. Only participating members will receive the Wage and Fringe Benefit Report for FREE.
After 8 months, the California Metals Coalition (CMC) has officially secured the tooling tax exemption for California’s metalworking industry. The Board of Equalization approved Regulation 1525.4 at its meeting on July 17-18.
An updated report, and guidance on this issue, will be covered at the Southern California roundtable this Wednesday (July 23), and at the Northern California roundtable (July 30). We are also preparing information for the July CMC Newsletter, and possibly a webinar. Please let us know if a webinar would be helpful for your company by emailing us here.
Do you have a passion for government affairs and the national manufacturing agenda? Do you want to represent NTMA, SFBA and your fellow machine shops on the National Government Affairs Team?
The National Government Affairs Team (see page 22 and 23 of your 2014 Membership Directory) insures that NTMA represents its members and the industry in relationships with government.
- To become recognized by federal and state governments as a national leader on issues affecting small business in general, and precision custom manufacturing in particular.
- To represent NTMA members' and the industry's interest before the US Congress, the Administration and the federal administrative agencies.
- To effectively lobby Congress on issues identified and prioritized at each annual meeting of the GAT.
- To participate actively in business coalitions on issues affecting the precision custom manufacturing industry.
- To testify or submit statements for the record in Congressional or federal agency proceedings on small business matters affecting NTMA members and the industry.
- To promulgate voter registration, education and grassroots participation between NTMA members and the Congress.
- To provide guidance and advice to NTMA members and chapters on specific state or local issues.
Government Affairs Team Members meet 4x per year in person, and may have up to 4 phone call meetings. The in-person meetings are:
- Gov't Affairs Team Annual Meeting
- MFG Conference
- Legislative Conference
- Fall Conference
If you have questions before you volunteer, or if you're ready to volunteer, contact the Gov't Affairs Team Leader, Paul Bonin.
- Paul Bonin
- Bertrand Products, Inc.
- PO Box 3786
- South Bend, IN 46619
Have you received the latest version of the NTMA Record?
This month's issue includes:
AB 2313 Update from CMC
June 20, 2014
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Advocacy Clips is a weekly compilation of relevant news articles from around the country on subjects that impact the metalworking industry. These articles are compiled by Bracewell & Giuliani, NTMA and PMAs public relations firm. Please forward this e-mail to a colleague who may have interest in these topics.
Manufacturing Day Welcomes Two Silver Sponsors
Midland Daily News
June 16, 2014
The roster of Manufacturing Day™ 2014 sponsors recently added two new key supporters, with both PMA - Precision Metalforming Association and SPI: The Plastics Industry Trade Association joining as a Silver Sponsors.
Manufacturing Day sponsors provide the resources to support manufacturers participating in the program, a grassroots effort by U.S. manufacturers to improve public perception of manufacturing in America by coordinating awareness-raising activities at a variety of locations across the country on October 3, 2014.
Manufacturing Day is an annual national event, executed at the local level, that supports hundreds of manufacturers across the nation that host students, teachers, parents, job seekers and other local community members at open houses designed to showcase modern manufacturing technology and careers. A panel of co-producers comprised of the Fabricators & Manufacturers Association, International (FMA), the National Association of Manufacturers (NAM), the Manufacturing Institute (MI), the National Institute of Standards and Technology's (NIST) Hollings Manufacturing Extension Partnership (MEP), and guest producer Industrial Strength Marketing (ISM) provide the centralized support necessary to coordinate this nationwide array of simultaneous events. The national media partner for the event is the Science Channel and the national movie partner is American Made Movie.
"The co-producers could not be more pleased that these organizations, which are so dedicated to serving their respective sectors of the manufacturing industry, are putting their full support behind Manufacturing Day for the second straight year," said Ed Youdell, president and CEO of the Fabricators & Manufacturers Association. "Their reputation and their reach to professionals in the industry as well as educators and students will help to generate participation in Manufacturing Day events across the nation."
To learn more about Manufacturing Day, visit http://www.mfgday.com. Organizations that wish to become involved as official sponsors should call 888-394-4362 or email info(at)mfgday(dot)com.
Metalforming Companies Expecting Slight Downturn
Industrial Distribution - PMA Business Conditions Report
June 19, 2014
According to the June 2014 Precision Metalforming Association (PMA) Business Conditions Report, metalforming companies expect a slight downturn in business conditions during the next three months. Conducted monthly, the report is an economic indicator for manufacturing, sampling 124 metalforming companies in the United States and Canada.
The June report shows that 31% of participants predict that economic activity will improve during the next three months (down from 33% in May), 54% expect that activity will remain unchanged (down from 60% last month) and 15% believe that economic activity will decline (up from 7% in May).
Metalforming companies also forecast a dip in incoming orders during the next three months, with 37% predicting an increase in orders (compared to 43% in May), 45% expecting no change (up from 43% in May) and 18% predicting a decrease in orders (up from 14% in May).
Current average daily shipping levels declined in June. Thirty-five percent of participants report that shipping levels are above levels of three months ago (down from 45% in May), 46% report that levels are the same as three months ago (up from 40% last month), and 19% report a decrease in shipping levels (up from 15% in May).
The percentage of metalforming companies with a portion of their workforce on short time or layoff increased to 8% in June, up from 7% in May. The June 2014 figure is improved from one year ago when 12% of companies reported workers on short time or layoff.
"The modest shift downward in the expectations of PMA members for the June through August period is consistent with a fairly typical manufacturing cycle in the metalforming industry, with a summer slowdown during July. This pattern likely is the primary cause of the downward shift reflected in PMA's June Business Conditions Report," said William E. Gaskin, PMA president. "Recent feedback from members during executive roundtables in the Twin Cities and Indiana, and reports of business conditions during PMA's recent Board of Directors meeting, indicates that orders and shipments remain stable with modest growth anticipated during the balance of the year, unless global security issues escalate to the extent that they lead to a disruptive situation for the overall U.S. or global economy."
Obama meets with Pittsburgh entrepreneurs to promote American manufacturing
The Washington Post
June 17, 2014
By Juliet Eilperin
President Obama touted the renaissance of American manufacturing Tuesday, traveling to Pittsburgh to meet with entrepreneurs who are using new technological tools to innovate and produce American products.
Speaking at TechShop Pittsburgh, the president talked about how the industry has evolved, noting that in the past, "manufacturing meant big factories, you know, all kinds of smoke and fire and a lot of heavy capital."
"But because of advances in technology, part of the opportunity is now - to make the tools that are needed for production and prototypes are now democratized," he added. "They're in the hands of anybody who's got a good idea."
The White House - which is hosting a "Maker Faire" on Wednesday to showcase some of the most cutting-edge examples of this trend - announced Tuesday that it will make the research, testing equipment and expertise of 700 federal agencies available to small and medium-size manufacturers so they can develop products faster. Five federal agencies also will invest more than $150 million to support the Materials Genome Initiative, a program aimed at boosting the nation's advanced-materials sector.
Advances in manufacturing tools such as 3D printing and laser cutters, and a surge in U.S. natural gas and oil production have helped spur a revitalization of American manufacturing in recent years. The rate of growth in new manufacturing firm is the highest since 1993, while manufacturing output has increased at about twice the pace of the economy overall since the end of the recession.
"We are witnessing here a new era in innovation and entrepreneurship, where entrepreneurs are tinkering and experiment not just with bits and bytes, but with nuts and bolts," Jeffrey D. Zients, director of the National Economic Council, said in a call with reporters Monday. "When an opportunity like this knocks, it's up to us to open the door."
The president engaged in a freewheeling 45-minute discussion with men and women with business aspirations, discussing the need for better child-care options, how the U.S. educational system could better prepare students and the fact that Obama's daughter Malia gave him a personal letter for Father's Day.
At one point, Obama even asked his aides to bring out his iPad, which uses a DODOcase.
"First of all, this is a great product. I love DODO. See, this - this is my iPad case," he said, noting that he has a picture of him hugging his daughters, Malia and Sasha, on his screen. "But I love this case. And the first prototype was made at a tech shop."
Also Tuesday, more than 90 mayors announced plans to support manufacturing research and development. Pittsburgh has launched a series of hardware start-ups and is offering science, technology, engineering and mathematics (STEM) educational programs at its libraries, while the mayor of Lansing, Mich., has appointed an urban manufacturing coordinator for the city.
Businesses, Policymakers Make the Case for 'Make it in America'
Us News and World Report
June 17, 2014
By Katherine Peralta
Re-shoring, or moving jobs back to the United States from abroad, could be a boost for the labor market, grow exporting and increase competitiveness. Or at least that's the expectation of economists, business leaders and policy makers speaking Tuesday at a forum focused on bringing jobs back to the U.S.
"There's no better time to invest in the United States," said Secretary of Commerce Penny Pritzker, during the event at the U.S. Capitol.
"Re-shoring is real," she said, and "the [Obama] administration and Department of Commerce stand ready to do our part to build on this momentum and drive these trends forward."
President Barack Obama today also expressed support for manufacturing growth at a town-hall meeting in Pittsburgh.
The two most important factors in driving U.S. manufacturers' decisions to bring jobs back are proximity to demand and proximity to innovation, said Katy George, director and colead of the Global Manufacturing Practice at McKinsey. These come secondary to other factors like labor cost and business climate.
With its low wages and a sound infrastructure in place for manufacturing, China at the beginning of the century made it "fundamentally easy for companies to shut their plants in the U.S. and manufacture in China," said Hal Sirkin, a senior partner and managing director at the Boston Consulting Group and professor at Northwestern University's Kellogg School of Management.
China's wages have slowly increased over time and by 2015, Sirkin said they could be about 61 percent of what they are in the U.S., up from their 24 percent of American wages in 2005. The cost-saving is therefore lessened, and the price and time it takes to move goods now makes it more advantageous to produce domestically.
"What makes all the difference is the time it takes to move the goods," he said.
There are seven categories that comprise two-thirds of everything the U.S. imports from China: computers and electronics; machinery; furniture; fabricated metals; transportation; appliances and electrical equipment; plastics and rubber. Within those categories, Sirkin said, the cost of producing in the U.S. is now either competitive with or better than what it is in China.
Whirlpool Corp. does more of its manufacturing in the U.S. than any of its other competitors combined, according to Jeff Fettig, the chief executive officer of the Benton Harbor, a Michigan-based appliance company.
"We could choose to manufacture anywhere. We choose ... largely to manufacture here because it's the best cost location, with the closest proximity to the marketplace, our ability to respond to our customers is faster than anywhere in the world and it produces the best economics," he said.
The company moved its horizontal access washing machine operations from Germany to Clyde, Ohio, and relocated its Mexico manufacturing of small hand mixers to its Greenville, Ohio, plant, which exports about 35 percent of its products and which is where the company plans to boost head count by about 400 employees.
"If we get an order today, we can get it to you tomorrow in 27 different colors. We can't do that if we're making it in China," he said.
The company also can't support its robust employment growth in the U.S. without its manufacturing base here.
"If we win in the marketplace, we grow; if we grow, we create jobs," Fettig said.
He did say that operating in the U.S. can have its drawbacks, including class-action lawsuits, corporate tax policies and government regulation, however.
Wal-Mart Stores Inc. is another U.S. company that's setting its sights on products made in America. Two-thirds of what the company sells is made in the United States, Michelle Gloeckler, the company's senior vice president said.
"There are many things that are uncertain about import business, certainly ports, weather, customs. You could name them at Wal-Mart we've probably had our fair share," she said. "At the end of the day that's a disappointment to our customer."
A boost to exports from companies like Whirlpool and Wal-Mart - and small- and medium- sized businesses, which comprise 98 percent of all exports from the U.S. - could be good news for the trade gap, which grew to $47.2 billion, the widest in almost in almost two years, the Commerce Department reported earlier this month.
House Minority Whip Steny Hoyer, a Democrat, will lead a "Made it in America" plan that includes several pieces of legislation aimed at boosting manufacturing and job growth.
"There's no reason why Congress can't take up these bills this summer," he said.
Manufacturing output increases solidly in May
June 16, 2014
By: Lucia Mutikani
U.S. manufacturing output rose in May and factory activity in New York state accelerated sharply this month, buoying hopes of a strong rebound in economic growth this quarter.
Factory production increased 0.6 percent last month as production increased across the board, the Federal Reserve said on Monday. Output had slipped 0.1 percent in April and economists had expected it to rise 0.5 percent last month.
"It reinforces the current narrative of a strengthening in U.S. domestic fundamentals, as the economy continues to build on the post-winter slowdown momentum," said Millan Mulraine, deputy chief economist at TD Securities in New York.
In a separate report, the New York Federal Reserve said its "Empire State" general business conditions index rose to 19.28 this month, the highest reading since June 2010, from 19.01 in May. Readings above zero indicate growth.
New orders hit their highest level in four years. Although factory job growth slowed, employers increased hours for their workers.
The reports were the latest evidence the economy was regaining steam after a dismal first quarter, when growth contracted at a 1.0 percent annual pace.
Data ranging from employment to services industries have pointed to a strong come back in the economy. Growth rate estimates for the April-June quarter range as high as 4 percent.
Federal Reserve officials meeting on Tuesday and Wednesday are likely to view the recent batch of fairly upbeat data as confirmation of underlying strength in the economy, economists said. The Fed is expected to announce further cuts to its monthly bond purchasing program.
AUTO PRODUCTION SURGES
Manufacturing output was last month led by a 1.5 percent jump in motor vehicle production. That followed a 0.1 percent dip in April. There were also gains in the production of machinery, computer and electronic products, electrical equipment and appliances, and fabricated metal products.
Production of primary metals slipped.
Mining output rose 1.3 percent in May, adding to April's 1.6 percent increase. But utilities production fell 0.8 percent, declining for a fourth consecutive month.
The rise in manufacturing and mining output helped boost overall industrial production by 0.6 percent in May. It had declined 0.3 percent in April.
The amount of manufacturing capacity in use rose to 77.0 percent last month, the highest level since March 2008, from 76.7 percent in April.
Overall industrial capacity increased to 79.1 percent from 78.9 percent. It remained 1.0 percentage point below its long-run average.
Officials at the Fed tend to look at capacity use as a signal of how much "slack" remains in the economy, and how much room there is for growth to run before it becomes inflationary.
Can 3-D Printing Reshape Manufacturing in America?
June 17, 2014
By Rakesh Sharma
According to Bob McCutcheon, US Industrial Products Leader at consulting firm Price Waterhouse Cooper, that may be a possibility.
He spoke to me last week after PwC released its report on 3D printing and manufacturing. McCutcheon says changes in typical supply chain, due to a combination of structural changes in manufacturing and new forms of energy supply, can provide the spurs to lead an inshoring revolution.
The financial crisis was the pivot that shortened lead times.
Manufacturing firms stacked up on products to keep pace with the demands of a booming economy during the pre-crisis years. Post-crisis, however, that dynamic changed as the organizations felt the effects of a pullback in consumer spending. In response, they dramatically reduced inventory levels, holding just enough product to cater to immediate market demands.
"There is a more short-term view right now and inventory levels have not gone back to their pre-crisis levels," explains McCutcheon, referring to inventory levels after the crisis. Low inventory levels have the effect of reducing supply chain costs.
This development has been complemented with the discovery of new and cheap energy options, such as Shale gas. Cumulatively, both factors have made it cost-effective for manufacturers to make their products here in the States.
"When you add 3D printing to the mix, there is a compelling argument to shift the cost curve back to the States (from low cost destinations, such as China and India)," says McCutcheon, adding that he has developed models to test his theory.
As I mentioned in a previous post, 3D printing can be used to supply highly customized products on demand to local geographies. But, it might be a while before this reality comes to pass.
Only thirty-five percent of organizations surveyed by report said they used the technology for prototyping and, in a minority of cases, for production. According to the report, the current sweet spot for manufacturing lies in low-volume and highly-specialized products which cannot be manufactured by traditional manufacturing techniques. Even the aerospace and defense industries, who are early adopters of the technology, use 3D printing to produce prototypes or products in low volume.
Then, there is the problem with talent. Workers in the manufacturing industry have just woken up to the reality of CNCs. 3D printing, which has the capability to transform the premise and nature of mass manufacturing, might be a bit of a stretch for them. McCutcheon says that mass manufacturing companies are already experimenting with shop floor and training exercises in 3D printing. The idea behind these exercises, according to him, is to understand the capabilities of the technology and customize it to their production mode.
The report also mentions other, interesting use cases for 3D printing, such as developing "lot of one" or using the technology in after-market support for replacement parts. In the former case, the technology is used to reduce inventory levels to just one highly-customized product. In the latter case, 3D printing is used to print replacement parts for products.
"The technology is already capable of producing high quality products," says McCutcheon. "The value (that it unlocks) in manufacturing can lead to development of new products and services."
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