Trump, Biden Push U.S. Manufacturing But Companies Need the Right Workers

Photographer: Spencer Platt/Getty Images North America

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If you hated President Donald Trump’s tariffs, you’re not going to like what his Democratic challenger Joe Biden has in store for manufacturing, either. Biden this week laid out a plan to target the offshoring of factory jobs with a carrot-and-stick approach that is strikingly similar to Trump’s own. There are some notable differences in tactics, of course: Trump still favors tariffs and is light on actual new specifics, while former Vice President Biden offered a detailed proposal to claim a bigger share of overseas profits through the U.S. tax code. The general gist, though, is the same: a domestic manufacturing renaissance is a national priority and those who don’t jump on the bandwagon will be penalized. 

Both candidates are also pitching tax credits for domestic production, while calling for stricter “Buy American” policies for the federal government. It’s a stark turn away from the globalization approach that markedly lowered the cost of goods for consumers, and the risk under either candidate is that U.S-based manufacturers will wind up being less competitive because of rising input costs, as my colleagues Karl Smith and Noah Smith noted. Certainly, it’s going to be hard for U.S. factories to compete if they don’t have the necessary workforce. 

We talked last week in this newsletter about how that’s one of the most glaring gaps in both the Trump and Biden plans. Both seem to be taking an “if you build it, they will come” approach to jobs when the reality is much more complicated. The narrative that robots are going to replace humans is overwrought, but the growing presence of automation and software is fundamentally changing the nature of those manufacturing jobs that will remain. When I speak with industrial executives, they consistently talk about the challenges of finding employees with the appropriate skill sets who view manufacturing as a desirable industry — even in the current environment of skyrocketing unemployment. There’s an added impetus to not only find workers but make the employee base more diverse. Companies are trying to solve this right now with a mix of outreach initiatives and local government partnerships. All concede more needs to be done. 

For example, women make up just 5.5% of Union Pacific Corp.’s workforce, CEO Lance Fritz said this week in a presentation at a Cowen conference. The company wants to double that by 2030, which would still mean women account for just 11% of its workforce, with the starkest inequities occurring in its unionized labor pool. A physical performance test and the interview process are knocking out women at a greater percentage than the company would like, but it’s also finding that the way job descriptions are written is keeping some women from even applying in the first place, Fritz said. “We’ve just got to get more women in the funnel,” Union Pacific Chief Financial Officer Jennifer Hamann said. “When you look at the number of women that apply for the jobs, it’s way down. So where do we need to advertise to do differently? What are different areas that we need to be reaching out to to even get the job in front of a woman?” 

ABB Ltd. is focusing on collaborating with local education systems and community groups as far down as the middle-school level. In Forth Smith, Arkansas, where the company operates a motors plant, ABB has started a youth apprenticeship program, advises the local university on curriculum and is participating in the development of a new career and technical education center that will feature state-of-the-art manufacturing equipment. It’s also partnering with a local-area Girl Scouts group to try to draw young women toward manufacturing careers. ABB has had challenges in the past getting older workers interested in switching from other fields to manufacturing and moving out of their comfort zones, said Johnny McKusker, vice president of operations for ABB’s U.S. motor business. It thinks if it can get to potential workers early, it has a better chance of making sure they have the skills it needs and an interest in working for a company like ABB. The company found a lot of overlap, for example, between the digital and 3D virtualization technologies it’s rolling out in factories and video games. “We didn’t see what was staring us in the face as early as we could have,” said Jason Green, who oversees human resources for the U.S. motor business. “We need the young talent to have deeper skills in automation and robotics and machining, and we need them to develop those skill sets faster. A high school senior needs skills that we might not have taught until the second year” of a university program previously.