9 Steps to Revitalize America’s Manufacturing Communities
For the past year, experts and stakeholders across the country have worked together to develop a new industrial policy that explicitly ties the goals of rebuilding America’s manufacturing base to that of revitalizing economically vulnerable communities and distressed regions. This endeavor has been called the High Wage America Project, whose interlinked priorities include spurring innovation, reshoring and revitalizing sustainable industries, reinvesting in workers, and mobilizing responsible capital. These objectives represent the best thinking of leading experts and practitioners from communities in the industrial heartland and will create the first-ever bottom-up, sustainable, and inclusive regional industrial policy.
This handbook gives policymakers quick access to the nine best actions for bringing this groundbreaking policy vision to fruition. They are:
1—Avert layoffs. The Workforce Innovation and Opportunity Act (WIOA) requires states to commit part of their rapid response program for economic dislocation to efforts that prevent layoffs. However, the fine print of those requirements gave states wide latitude and implementation has lagged. This trend must be reversed. States should establish the capacity to provide proactive business turnaround assistance in partnership with skilled organizations outside the workforce system. This should include assistance to businesses in economic distress and helping exiting owners convert to employee ownership. Example: Pennsylvania Strategic Early Warning Network.
2—Buy America. The federal government already requires made-in-America iron, steel, and other manufactured goods for all federally financed infrastructure and defense projects.3 States can extend these protections to state-funded infrastructure projects, including permanent and temporary public buildings (like schools and hospitals), roads and bridges, mass transit, waterways, and airports that are not already covered by federal Buy America rules. States should prioritize requiring made-in-America iron and steel, which are the easiest components to label and identify. Example: 2017 New York4 and Texas5 Buy America policies.
3—Reshore. Reshoring has developed some national momentum, but as companies recognize the closing cost gap between offshoring and producing domestically. Still,, no systematic state or federal initiatives yet assist firms with transitioning back to producing and hiring on American soil. States should fund and implement a reshoring technical assistance team that helps overcome the market failures (lack of information and uncertainty) that lead firms not to consider reshoring, and to demonstrate the cost-effectiveness of making the transition. For more information, see the Reshoring Initiative.
4—Foster sector partnerships. Sector partnerships aggregate employer demand, identify skill gaps, and make it possible for job seekers to fill them. States should stabilize and scale up public–private joint investment in industry-led and worker-centered manufacturing sector partnerships. States can appropriate general or employer-funded state training resources and combine them with federal funding for specific groups of workers, like the funds created by the Workforce Innovation and Opportunity Act, the Temporary Assistance for Needy Families program, the U.S. Department of Transportation, and the Supplemental Nutrition Assistance Program’s Employment and Training programs. Public funding is crucial for planning and starting up, and private sector match is crucial for sustaining and scaling. Example: Pennsylvania Industrial Partnerships.
5—Nurture industrial apprenticeships. States should bolster industrial apprenticeships through tax credits of $1,000–$2,000 per year per apprentice, as well as through state financial aid for related instruction at higher education institutions. This funding should come alongside support for strong multi-firm apprenticeship hub organizations that focus on reaching women and people of color. Examples: the Wisconsin Regional Training Partnership8 and the AFL-CIO Industrial Manufacturing Technician Apprenticeship.
6—Increase the number of minorities and women in manufacturing. States should focus on leveraging the manufacturing recovery to create a more diverse workforce. Companies need to work with workforce providers and educational institutions with deep roots in communities of color, and with state programs that provide sufficient resources for marketing, wrap-around services, post-placement mentoring, skills training, and work-based learning. One promising tool is the U.S. Employment Plan, which allows localities to give vendors additional points for inclusive manufacturing hiring plans in bids to manufacture federally funded public transportation. For more information, contact: Jobs to Move America.
7—Invest in innovation. States should continue and increase investments in university-based cooperative research and development centers that break down barriers between scientific research, engineering applications, and product and process commercialization. To complement these efforts, states should offer small innovation vouchers (up to $50,000) to small manufacturers who seek to work with local universities or research centers. Example: Rhode Island Innovation Vouchers.
8—Invest responsibly. State and city pension funds, and other institutions, should adopt the United Nations’ Principles of Responsible Investment (UN PRI) and enact investment policy measures to comply with the Department of Labor’s guidance on economically targeted investments (DOL 2015-1). The UN PRI are voluntary standards committed to analyzing potential investments by environmental, social, and governance principles. The DOL 2015-1 guidance allows pension funds to consider social needs as long as financial returns are not compromised. Economically targeted pension funds should invest in promoting in-state manufacturing and community development and ensuring sustainable investment in cities and communities. Example: The Office of the Illinois State Treasurer is a signatory to the UN PRI.
9—Create state manufacturing task forces. Governors should convene multiple stakeholders, including business, labor, academia, and workforce providers, to develop a state manufacturing strategy, as well as identifying key manufacturing clusters and coordinated industrial and workforce policies that would support the strategy’s success. Example: National Governors Association Center for Best Practices Policy Academy.
This report is edited by Andrew Stettner, Senior Fellow, with sections authored by members of the High Wage America Advisory Committee: Tom Croft, Stephen Herzenberg, Jack Mills, Michael Shields, Christy Veeder and Joel Yudken.
To read the entire report and download "best practices" for each Step, please click here.