Monday, January 28, 2013

Europe and the United States re-industrialization obstacles: the high cost vested interests constraints

Manufacturing critical to innovation and competitiveness of a country, the United States needs to revival of the manufacturing sector, and thus lay the foundation for long-term economic prosperity. "He told the" Outlook "Newsweek reporter, let him worry about in the past half more than a century, the U.S. manufacturing sector has been in decline.

In 1950, the manufacturing sector accounted for the proportion of the U.S. gross domestic product for new work he coauthored with Gary Pisano "create prosperity: why the U.S. needs manufacturing renaissance" of the book describes the gradual decline of the U.S. manufacturing sector picture: 27%, accounting for 31% of the total employment in the United States, 2010, however, the ratio of these two has decreased to 12% and 9%. As of the end of 2011, U.S. manufacturing jobs is less than 12 million, while the peak in the U.S. manufacturing sector in 1979, this figure is 19.6 million, on average, about a year lost more than 230,000 manufacturing jobs.

British manufacturing has also gone through a similar experience.

Northwest city of Manchester is the pioneer of the Industrial Revolution in England, the birthplace of textile machinery, the first industrial revolution and thus Faren, a textile center in the United Kingdom and the world as a whole. But with the transfer of the textile industry to Asia and other regions, Manchester has long since gone when the production of the grand, leaving only a vicissitudes of the Old City.

The data show that in the past 30 years, manufacturing employment continued to decline. 1990, the manufacturing sector in the UK economy, the proportion of 22%, to the present, the proportion was only 10%.

The outbreak of the financial crisis, and finally to Europe and the United States and other developed countries to realize that over-reliance on the harm caused by the financial industry and other virtual economy to the national economy as a whole.

Do not need the manufacturing sector also can become a global innovation envisaged 'very dangerous', governments and enterprises must be abandoned as soon as possible 'the deindustrialization test'. "Appeals from many people of insight.

So "re-industrialization" began to be put on the agenda.

From 2009 to 2012, the Obama administration has launched a "Buy American", "manufacturing Promotion Act," five-year plan to double exports, internal security and employment initiatives and many other policies to help U.S. manufacturers industry revival.

Since 2008, the British government issued several manufacturing development strategy, the establishment of the Strategic Investment Fund Manufacturing. 2011 also identified the manufacturing five competitive strategy: to occupy the world's high-end industry value chain, to accelerate the speed of technology into productivity, increase investment in intangible assets, to help enterprises to increase investment in people and skills, the occupation of the development of low-carbon economy first machine. In November 2011, British Prime Minister David Cameron and even set up special "Queen Elizabeth Engineer Award, reward those skilled engineer, a bonus of up to 1 million pounds.

Despite numerous initiatives, but in the opinion of many professionals, Europe and the United States manufacturing sector recovery is bound to be a long and tortuous process, ultimately really can achieve, is difficult to determine conclusively.

Introspection after the crisis

Financial markets not only give economic growth the wheel of lubricants, and the economic growth of the wheel. "This is a former U.S. Treasury Secretary Larry Summers famously. In his opinion, the financial industry is the unique advantages of the United States, is the central nervous system of the United States economy, the development of the financial industry is related to the well-being of the U.S. economy.

Has a similar point of view of a few officials, these people advocate to encourage financial innovation and the development of the non-manufacturing sector, without the need to pay attention to the development of the manufacturing sector, "the United States has entered a 'post-industrial society', the industrial products imported from abroad, without the need to U.S. domestic production. "

This thought has had a significant impact to the industrial development in the United States and the brain drain: the mathematical geniuses do not want to go to the Industrial Research Institute, but keen to Wall Street, policy makers is the lack of attention to the development of the manufacturing sector also. This has resulted in inadequate investment in the resources of the United States to the manufacturing industry, science and engineering research, also makes the United States the general public is not interested in the accumulation of scientific and technological knowledge.

American kindergarten teacher I have knowledge of science and technology classes are not familiar with, will naturally avoid and children talk about tech knowledge. "Alcoa chairman Klaus 克莱因费尔德 playing the a vivid metaphor .

However, after the outbreak of the crisis, many people began to reflect.

"In the past, people usually manufacturing sector has a common misconception that the manufacturing industry is the production of low value-added activities, only need low-skilled workers, and the industry can easily outsourced to the rest of the world." Shizhao Wei talked about, but now many factories, the manufacturing sector has been able to become a knowledge-based work. For instance, complex, precision machining, it is required to be able to produce large quantities but also a very high quality components at an economically viable cost.

Martin Bailey, a former chairman of the U.S. President's Council of Economic Advisers, accounted for less than 10% of the total U.S. economy, the manufacturing sector is difficult to carry the banner of the U.S. economic recovery, but the research and development of the manufacturing sector accounted for U.S. private sector R & D investment 70 %, crucial for maintaining America's ability to innovate.

Bruce Katz, vice president of the Brookings Institution in the United States also believes that the manufacturing sector is the lifeline of innovation, despite the ratio of the share of the manufacturing sector in the U.S. economy is not high, but the manufacturing sector currently employs 35% of the engineers in the United States, accounting for to 68% of the total investment of U.S. corporate R & D, the number of patents in the manufacturing sector accounted for 90% of the total of the entire United States patent.

British Government seems to clearly recognize the global manufacturing industry is undergoing a profound transformation from traditional manufacturing to high-tech manufacturing, manufacturing practitioners the army also increasingly diversified, in addition to the traditional workshop production and mechanical operation, is engaged in supporting the work of the R & D, design, sales, after-sales service.

"Our strategy is high-value design and innovation." British Business, Innovation and Technology, the Ministry of Business and Enterprise Minister of State Prius Trask had clearly expressed.

The basis of the return of

Although Europe and the United States economy has suffered heavy losses, the financial crisis makes the government aware of the harm of neglect the development of the manufacturing industry, the manufacturing industry can be considered a blessing in disguise, policy and funding support. At the same time, some emerging countries, rising labor costs also brought opportunities to Europe and the United States manufacturing sector reflux.

The data released by the U.S. consulting firm AlixPartners wages of Chinese workers in the past year grew 30%, 5% RMB appreciation relative to the dollar, shipping costs rose by an average of 5%.

Last year, the British paper manufacturer Filofax company production of 500,000 sets of Notepad from China to the south of Edinburgh Dalkeith. The given reason is: the rapid rise in wages of Chinese workers, factors such as transportation costs and delivery times are counted, in the UK, with the gap between the cost of production in China has been greatly reduced.

More importantly, the developed countries such as the United Kingdom, the advantage in the research, design, innovation makes it promising great success in the manufacturing market segments.

The automotive industry, for example, although more than one car brand in the UK have been easy to master his country, but the design and production of these cars are still in the UK, and from traditional manufacturing morphological shift to higher value-added sectors, such as technology and design innovation.

In addition, energy-saving technologies, the British car industry reputation. UK average new car CO2 emissions fell last year to 22.7% per kilometer 133.1 grams, the minimum level of carbon emissions for the past 10 years. In the case of general atrophy of the European car industry, the British thriving, new car registrations increased by 5.3% to 2.04 million, the highest level since 2008.

Furthermore, the large number of SMEs, many companies will be able to rely on the individual patent design occupy huge market share in their respective market segments. These enterprises may not have the world's top 500 fame, but they are well-known in the industry. For example, Europe's largest oil and gas industry the valve manufacturer OliverValves started at the beginning, that is, its founder, designed a very strong ability of an anti-leak valve, its first order from a synthesis gas refinery in China, the second customer is the famous British Gas Group, this private company has gone through 30 years.

Headquartered in Cambridge, UK chip designer ARM Holdings is a successful example. ARM has a strong R & D capability and excellent business model itself does not produce chips, but the chip design, licensed technology intellectual property to semiconductor companies, which each produce an ARM chip design, necessary to its pay certain royalties. Currently more than 95% of the global mobile phone as well as more than a quarter of the electronic devices in use ARM technology. Since the financial crisis, ARM performance non-decreasing by increasing popular on the London stock market blue chips.

Experts believe that widespread in Europe the decline of the manufacturing industry, but from the technical content of industrial products, quality, brand, has a forward-looking environmental elements considering Europe's industrial competitiveness is still very strong, and its industrial sector get the added value also has the world's highest level. In addition, the EU also holds nearly 50% of the global industry technical standards and product rules, these factors are favorable conditions for European "re-industrialization".

Reflux illusion

The manufacturing industry reflux seems to have made "remarkable achievements".

The data show that, compared with January 2010, the number of manufacturing jobs in the low stage 11.5 million, U.S. manufacturing has increased in this round of economic recovery period of about 500,000 jobs.

However, the truth may not like data performance as optimistic.

Careful analysis will find that, created after the manufacturing jobs and the recovery of the U.S. economy compared to about 5.8 million, about 9%, this agreement accounted for 9% of the proportion of the total number of U.S. jobs and manufacturing jobs, while the manufacturing industry in this round of economic recession, massive layoffs of 226 million people, accounting for about 20% of the total number of employees of the manufacturing sector, far more than the proportion of manufacturing industry in the United States the total number of employees, and therefore can not be ushered Judging from U.S. manufacturing "second spring . "

In fact, the present situation, the return of U.S. jobs more because of cost-driven, rather than a new industry-driven. Therefore, many experts believe that the positions reflux this may just be phased trend is hard to become a torrent, the medium to long term, the hourly wage of U.S. manufacturing workers have up to about $ 20, about two percent more than the average of other industries, the U.S. difficult to significantly enhance manufacturing jobs.

Industry estimates, Whirlpool labor costs in China is only equivalent to the United States about a quarter. Therefore, its American symbolism seemed re-factories than substantive significance. Judging from the existing case, to set up factories in the United States are often dozens of small-scale factories, large-scale production is still in the labor cheaper, more flexibility in Asian countries.

Manufacturing jobs return will not become the trend of the flood, Asia has not only doing my choice. "American manufacturers to improve productivity and Innovation Alliance chief economist Daniel Philippe Mexes Castro, thinking it comes.

Katz view more clear, in his view, the United States over the past half a century, the loss of more than 700 million jobs is difficult all return to the United States, estimated 2 million to 3 million jobs in the United States can only increase in the future, the United States The prospects for recovery in the manufacturing sector is not optimistic.

Political obstacles

Sorin Della is a solar panel manufacturer in California, the first batch of the Obama administration to give loan guarantees one of the energy companies, the Obama administration has been called a "model" to create green energy employment. However, the company at the end of August 2011 due to poor management and declared bankruptcy in 1100 people unemployed.

In the 2012 election approaches, Republican enlarge this event, accused the Obama administration for "politically motivated" rush to provide loan guarantees for the company, resulting in taxpayer losses. Dragged down the new energy plan, smart grid, post-carbon future economic development of the highlights in the last year during the presidential election in the United States became a political Taboo.

In addition, the Obama administration has also put forward last year corporate income tax reform, trying to reduce the manufacturing enterprises of the highest corporate income tax rate from 35% to 25%, in order to attract manufacturing jobs reflux, but the U.S. Congress has not this consideration. Based on past experience, any major tax reform is bound to conflict with the U.S. bipartisan government budget issues linked.

"The United States is currently the situation, might the new energy industry development opportunities ceded competitors." Darrell West, vice president of the Brookings Institution, not without fear.

In fact, long been the experts pointed out that, although the Obama administration has proposed many of the revitalization of the manufacturing planning, but most of them are only guidelines, rather than administrative mandatory program.

Katz commented, the U.S. federal government has not yet formed a comprehensive strategy to support the manufacturing industry, the federal government is not enough for the financial support of the manufacturing sector, implementation and manufacturing-related policy is the Ministry of Commerce, Department of Labor, the Department of Energy and other Federal government departments, resulting in policies from multiple-door situation, the United States federal government should develop a systematic strategy to support the manufacturing industry.

Your correspondent in Virginia and other states. Interview that the United States hopes to increase the proportion of clean energy accounted for salons charge as soon as possible, the power companies are also efforts to promote solar power home to the public, but the progress is not smooth. Not only met with government grants, traditional energy greater price advantage bottleneck, and smart grid construction also met with local government with embarrassment.

However, in the opinion of some analysts, the real reason of the contradictions, the Obama administration's new energy development plan there is a big conflict with more emphasis on the development of traditional fossil energy Republican camp.

Kentucky Louisville Mayor Greg Fischer pointed out that the political mechanism dictates the current United States can not stop and discuss how to learn to industrial powers such as Germany, Japan and China, and busy all day to solve the "fiscal The the cliff like self-directed and starred in the short-term challenge, which makes the lack of long-term strategic vision and execution.

In fact, the development of emerging manufacturing often require a longer incubation period, the current political mechanisms in the United States and no hustle conditions to the development of emerging industries. Congress elections every two years to four years once the presidential election, will make many Members of the United States to focus on the ultra-short-term issues, the only way to limited serving time for their own re-election to create scoring point. Increasingly strong sense partisan Washington political status quo that has allowed democracy in recent decades, Republican obvious differences in the budget, taxes and other economic issues, and almost all large national project budget and tax issues and must go through Congress for approval, resulting in efficiency retardation, Sorin Della event is just one of an example.

No comments:

Post a Comment