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EARN/AAM Multi-State Manufacturing Project

State Template Manufacturing Policy Agenda

Draft, June 8, 2016

Note: This draft template is offered in the spirit of a check list. It is not expected that it will make sense for any one state to advance an agenda with all these initiatives. As well as feedback on what is here, please think about what should be added so that it becomes a more complete check list.

Framing: Why Manufacturing Matters

  • Critical to regional/state economic and GDP growth –GDP share, share of private investment in research, of patents, of exports outside the state/region, much higher productivity growth
  • Still important to middle class – employment share, wage share, higher wages relative to other sectors especially for those without four-year college degrees
  • Create an infrastructure to help mature companies thrive (innovate, adopt best practices) and new startups launch and grow in dynamic global context. (High road/low road left implicit.)
  • Do we put in context of…Third Industrial Revolution/Maker Movement, emerging era of small batch production, potential for localization, retreat from globalization, new wave of manufacturing innovation fueling new era of prosperity – critical for state/regions to get out front. Also in the context of new age of robots/artificial intelligence – your state and region needs to make its share of the machines that do the work.

Policy Pillar One: Develop and Support a State Manufacturing Strategy

  • High profile leadership for manufacturing in state government and public/private stakeholder group(s)
  • What about a [STATE] Advanced Manufacturing Partnership?
  • What existing models work/could be spread?
  • What models will business partners support in the age of anorexic government?
  • Research and analytic capacity inside and outside (e.g.,“sectoral centers of excellence”) state government – analyze data including mapping industry clusters, gather industry intelligence, and identify of “industry-specific” public goods (investments) that will have highest ROI.
  • Sustainable models for public-private financing of state manufacturing strategy
  • Leverage federal funds
  • Bonds (e.g., Ohio)
  • Multi-employer tax credits
  • Use of state pension funds/tax credits to create U.S. “solidarity funds”
  • Negotiate compacts with neighboring states to avoid subsidy wars and focus resources on solving market failures that lead to underinvestment in innovation and industry-specific public goods
  • What else?

Policy Pillar Two – Retain, Reshore and Startup

  • Use Workforce Investment and Opportunity Act (WIOA) Rapid Response funds to implement best-practice layoff aversion retaining jobs for less than $1,000 per job
  • In context of “reshoring” movement and manufacturers’ re-evaluation of the pros and cons of offshore vs. local sourcing, launch multi-pronged [STATE] reshoring initiative.
  • Promulgate tools that accurately assess offshore/onshore trade-off
  • Supply chain/OEM partnerships that support shifts to local sourcing
  • Interagency teams in state government overseen by “Governors’ Reshoring Action Team” to coordinate resources in support of reshoring
  • Support low-cost networking among university and industry researchers (scale down version of National Advanced Manufacturing Institutes)
  • Strengthen the innovation eco-system for startups: design review, assistance with prototyping, help finding contract manufacturers, capital, workforce
  • Seek NIST funding for network-based MEP pilots, including assistance with reshoring and support for startups (e.g., using learning from NY virtual assistance for startups)

[Alternative organization: move innovation and startup elements from pillar two to pillar three and relabel that “Capital and Innovation.”]

Policy Pillar Three – Capital

  • Provide financing from any sources adopted from bullets above on “sustainable models”
  • Explore state bank & partnerships w/[IN STATE] banks to provide working capital
  • Expand [STATE] pension fund investment in in-state manufacturing projects and for development projects with local procurement
  • Support “crowd sourcing” – adopt a best-practice state law that capitalizes on the Section 147 exemption from restrictions on crowd sourcing

Policy Pillar Four – Skills

•Increase public-private investment in manufacturing apprenticeship and Industry Partnerships, with journey-workers paid a target wage high enough to maintain manufacturing reputation as a high-wage sector

•Partner with industry and academia to establish “sectoral councils” that research workforce needs, promote peer learning and the spread of best practices, and evaluate impact of strategic workforce investments

•Promote the maker movement and brand [YOUR STATE AND/OR REGION] as a “maker state” or “maker city”

Policy Pillar Five – Demand

•Establish a [STATE] Fair Trade Office to provide small and medium-sized firms with access to U.S. unfair trade protections and coordinate advocacy for better trade laws

•Promote Buy [YOUR STATE]/Buy America procurement

•Invest in [YOU STATE] infrastructure

•Support Blue-Green initiatives to support long-term production localization(e.g., green building alliances, renewable energy)