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Advancing Advanced Manufacturing Region by Region

At last a more serious discussion of manufacturing has begun. In just the last month, strong voices have by turns questioned whether manufacturing merits special attention, contended that it does, and then begun to say which sort of manufacturing matters most. Just last week the Metropolitan Policy Program joined with the CONNECT Innovation Institute to produce a major event that contended that regardless of its diminished employment manufacturing remains a powerful engine of innovation, a driver of exports that are taming our trade deficit, and a source of good-paying jobs.

Now, the National Science and Technology Council has taken a stab at laying out what the federal government might do to advance the more “advanced” higher-tech segments of the manufacturing sector.

Created through an interagency process chaired by representatives from the federal departments of Commerce, Defense, and Energy, the plan documents the fundamental importance of advanced manufacturing to the nation’s economic well-being and sets forth five objectives for federal policy:

  • Accelerate investment, especially by and in small- and medium-sized manufacturers
  • Make the education and training system more responsive to the demand for skills
  • Optimize federal advanced manufacturing R&D investments by taking a portfolio perspective
  • Increase total public and private investments in advanced manufacturing R&D
  • Foster national and regional partnerships among all stakeholders in advanced manufacturing

Again, all of these goals are important, but it is gratifying to see that the new strategy heavily stresses the critical role of regional industry clusters in propelling advanced industries.

How did the interagency working group arrive at such a strong regional focus? Because it realized that advanced manufacturing in America is sustained in Louisville and Wichita and San Jose by the interactions of thousands of small- and medium-sized enterprises (SMEs) linked tightly (or loosely) into geographically-concentrated communities or supply chains.

Very rarely does a manufacturing firm exist in isolation. Instead, advanced manufacturing firms interact constantly with each other and with local research universities and community colleges, labor unions, trade associations, and governments in ways that build up a shared “industrial commons” of shared knowledge assets and even shared physical facilities. Since these commons exist locally, and since ensuring their global leadership will be crucial, regional industry clusters and local manufacturing ecosystems are going to loom large as central units in any strategy to foster these high-value industries. That’s why Bruce Katz and I several years ago called the present era a “cluster moment.” Increasingly, it is being recognized that clusters are a fruitful economic basis for efforts to improve technology platform development, knowledge sharing, training, and research application.

So what might federal engagement to catalyze and strength regional advanced manufacturing clusters look like?

To an extent such work is already underway albeit at too small a scale. Already the federal government is making cluster-based investments that aid and abet the efforts of local educational and research organizations, state and regional economic development authorities, and the private sector to coordinate their activities and to conduct proof-of-concept and commercialization activities.

For instance, the Jobs and Innovation Accelerator Challenge--led by the Economic Development Administration (EDA) in the Department of Commerce in partnership with other agencies such as the Department of Energy, National Institute of Standards and Technology (NIST), and the Small Business Administration (SBA)--will run a competition focused on advanced manufacturing in fiscal 2012.

Programs like these are just the right way to support--with a light touch--the “bottom up” initiatives that are breaking out across the country in U.S. regions.

In any event, it is good to see the federal government thinking seriously about how to defend, renew, and expand America’s crucial advanced manufacturing sector. That regions and local innovation clusters lie at the center of its thinking bodes well, as there may be no other way to engage with these intricate, fast-moving, and regionally varied industries.