Manufacturing may be taking slow, tentative steps back into the U.S. market, but those baby steps are starting to yield big returns for places like Athens, Ga., which recently landed 1,400 jobs from a major Caterpillar plant coming back from Japan. What’s the best strategy for states, regions and cities looking to build upon that momentum?
Developing regional clusters of highly specialized companies, especially those focused on machinery, composite materials, auto production and aerospace, is key to building back manufacturing in many parts of the U.S., according to a new report from the Brookings Institution.
The report noted that nationwide manufacturing is “displays greater variety than may be recognized and falls into six broad patterns of industry clustering,” which include computers and electronics, transportation equipment, chemicals, machinery, food productions and low-wage manufacturing industries.
This cluster-based approach to manufacturing has been a guiding force for some economic development leaders in Ohio. Boasting 620,000 manufacturing jobs by the end of 2010, the Rust Belt state is slowly starting to regain some of the 39 percent of manufacturing jobs it lost over the past decade.
In the Dayton area, leaders are working to restore the region’s historic manufacturing base by building on existing clusters in aerospace and advanced materials.
“We are in the middle of the nation and in an area that is growing more quickly,” Scott Koorndyk, executive vice president of the Dayton Development Coalition, told Aerospace Manufacturing and Design magazine. “We are investing in early stage technologies to build clusters in those things that we are good at.”
Potential for the Midwest, Southeast
The Midwest is best positioned to take advantage of this, in part because it is still the most manufacturing-dependent region. But a few Southeastern states are also discovering viable clusters to replace others that have become obsolete.
Once dependent on apparel and textile manufacturing, Alabama landed a Mercedes-Benz plant in 1997 that jump-started its auto industry. Since then, the state has grown the sector from 3,4000 jobs to 10,4000 jobs in just 10 years. Specializing in auto parts production has also been a boon for Kentucky, which operates major auto assembly plants for Toyota, Ford and General Motors. The state’s 65,000 auto manufacturing jobs now exceed those in its staple aluminum production and processing sector.
What do you think of this cluster-based approach to manufacturing? Would it work for your region?