The caucuses are a few days away, and Iowa voters are hearing more and more from presidential campaigns. Voters have heard plenty of rhetoric, slogans and promises, but they deserve to hear more about one very important topic: manufacturing.
Specifically, what are candidates going to do to preserve and promote manufacturing in Iowa and across the United States?
It is a critical question. America’s strength depends on manufacturing. In fact, if manufacturing in the United States were its own country, it would be the ninth-largest economy in the world.
Manufacturing represents about 9 percent of the U.S. economy and about 17 percent of Iowa’s economy and nearly 14 percent of Iowa’s non-farm workforce. And manufacturing jobs are the backbone to the middle class. These jobs pay higher than average wages, and for millions of hardworking Americans, they provide health care and retirement benefits.
The strength of other industries depends on manufacturing as well. Just one manufacturing job can lead to the creation of three to five more jobs in other industries, and every dollar spent on manufacturing means another $1.40 added to the economy, the highest multiplier of any sector.
Simply put, having a growing economy and a more prosperous country requires manufacturing growth, which requires the right policies from Congress and the White House. So as candidates and their campaigns crisscross the Hawkeye State over these final weeks, Iowa voters should be prepared with questions on the issues that matter to manufacturers.
First, for example, how will you modernize and streamline Washington red tape and regulation? We need smarter, more transparent and better regulations. We all want clean air, clean water, safe food sources and safe workplaces, but today’s regulatory environment is overwhelming — especially for small manufacturers with fewer than 50 workers. According to a study by the National Association of Manufacturers (NAM) the current regulatory system costs such companies nearly $35,000 a year per employee. Just imagine if some of that money were instead going to a worker’s paycheck — or back into a customer’s pocket!
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Second, how will you reform and improve the tax code? Just last month, manufacturers won an important victory when Congress made the research and development tax credit a permanent part of the tax code. But much work remains. Today, companies in America are burdened by an outdated, arcane tax system that includes a higher tax rate than their competitors in other developed, major economies. That makes it even harder to compete internationally and attract new business to our shores. Manufacturers need comprehensive tax reform that strengthens the U.S. industrial base by reducing the overall tax burden on manufacturers and promotes increased investment in domestic manufacturing facilities and equipment.
Third, how will you advance free and fair trade policies? Ninety-five percent of U.S. manufacturers’ potential customers live in other countries. To build more things in the United States, we need access to consumers outside the United States. Robust new trade agreements that set high standards and concretely level the playing field are a vital component of a strong U.S. trade agenda. So too is stronger enforcement of international trade rules. The American people and U.S. businesses must be protected against manipulative and unfair foreign competition.
Finally, how will you promote interest in manufacturing careers? A manufacturing career is rewarding, and Iowans who work in manufacturing earn $20,000 more a year on average than those in other industries. Skilled workers are in high demand, but not enough young people are learning those skills.
According to a study by Deloitte and The Manufacturing Institute, “The United States faces a need for nearly 3.5 million manufacturing jobs over the next decade, and 2 million of those jobs are likely to go unfilled.” We must grow the manufacturing workforce and equip current and potential workers of all ages with the skills that are in demand.
• Chuck Schmitt is president of SSAB Americas, one of the largest North American producers of steel plate and coil, serving many industrial markets including energy, construction, agriculture and transportation. Jay Timmons is president and CEO of the National Association of Manufacturers (NAM), the largest manufacturing association in the United States representing small and large manufacturers in every industrial sector.