MANUFACTURING UPDATE

- NOVEMBER 2014 -

1. LATEST POLICY

==================================

Passed by Congress -- Omnibus appropriations bill with manufacturing

priorities

Congress passed a $1.1 trillion omnibus appropriations bill that featured many manufacturing
priorities, including:
The bill increases funding for the Manufacturing Extension Partnership (MEP), to $130
million. MEP is the only public-private partnership dedicated to providing technical
support and services to small and medium-sized manufacturers.

Additional funding for the NSFs Experimental Program to Stimulate Competitive

Research (EPSCoR) a federal-state partnership that awards competitive funding to
states to increase energy-related research investments.

The bill includes language recognizing the importance of U.S. bio-manufacturing and
directing the NSF to increase support for bio-manufacturing in its advanced
manufacturing portfolio by dedicating at least $15 million to new bio-manufacturing
initiatives.
More: Coons release

Passed by Congress -- National Manufacturing Strategy

Congress passed bipartisan legislation authored by Sens. Coons (D-DE) and Kirk (R-IL) to create a
national manufacturing strategy. The bill was originally introduced in 2013 and would
strengthen American manufacturing while not costing the federal government any money.
Its time we catch up to our competitors around the globe and build a coherent, focused
manufacturing strategy that can strengthen the middle class and make America the destination
for 21st century manufacturing, said Senator Coons.
More: Coons release

Introduced -- Trade Adjustment Assistance Act of 2014

U.S. Sen. Sherrod Brown (D-OH) introduced legislation to extend a critical lifeline for workers
who lose their jobs due to foreign trade. Browns bill would reauthorize the Trade Adjustment
Assistance (TAA) program and expand its training and reemployment services to 2009 levels.
According to the Department of Labor, approximately two million workers nationwide have
relied on TAA since 1975 to make ends meet and receive training necessary to find a new job.
While some are talking about eliminating barriers for big corporations through more NAFTAstyle trade deals, theyre willing to create barriers for unemployed workers by allowing TAA to
expire, Brown said. Trade Adjustment Assistance is a critical part of our nations
competitiveness strategy. This jobs training program ensures that workers have the tools they
need to succeed in the high-growth, high-skill industries that are hiring. This bill would provide
long-term certainty to support and advance our workforce while encouraging growth.
More: Brown release

Executive Action -- President Obama announces manufacturing action

President Obama announced nearly $400 million to help improve the competitiveness of
American businesses and workers by spurring new manufacturing innovations and giving
American workers additional opportunities to improve and expand their skill sets for middleclass jobs.
The President announced:
More than $290 million in public-private investment for two new Manufacturing
Innovation Hub Competitions. These hubs will help support new advancements in
manufacturing, and fulfill the Presidents 2014 State of the Union pledge to launch four
new institutes this year, for a total of eight institutes launched so far, and puts the
Administration past the halfway mark on the Presidents original goal of creating 15
manufacturing innovation institutes supported through executive action. The hubs will
include:
o A Department of Defense-led Flexible Hybrid Electronics Manufacturing
Innovation Institute. The institute will focus on hybrid electronics that combine
flexible materials with thin silicon chips to produce the next generation of
electronic products seamlessly integrated into the things around us. The hub
will combine $75 million of federal investment with $75 million or more of
private investment.
o

A Department of Energy-led Smart Manufacturing Innovation Institute. This

institute will focus on smart manufacturing, including advanced sensors, control,
platforms, and models for manufacturing. The new institute will receive a
federal investment of $70 million that will be matched by at least $70 million in
private investments.

$100 million to expand apprenticeships for American workers. Apprenticeships are a

proven training strategy for workers to learn the skills that employers need for
American businesses to grow and thrive in a competitive global environment. The
Department of Labor will launch a $100 million competition that will award 25 grants to
business, non-profit, and local government partners. The grants will help launch
apprenticeships in new, high-growth fields, align apprenticeships with pathways to
further learning and career advancement, and develop apprenticeship models that
scale.
More: White House fact sheet

2. OTHER NEWS

==================================

Floor Speech -- Sens. Ayotte and Coons speak on Manufacturing Skills Act

Senators Coons (D-DE) and Ayotte (R-NH) took to the Senate floor to highlight bipartisan
legislation they introduced to help cities and states build 21st century manufacturing training
programs. The Manufacturing Skills Act will create a $100 million competitive grant program to
support initiatives that strengthen the manufacturing workforce and address regional skills
challenges.
Sen. Coons stated, Manufacturing is one of the great areas of opportunity for meaningful
bipartisan cooperation that will move our country, our economy and our working families
forward. The bill has one simple goal which we share -- to spur reforms in manufacturing
skills training across our country. I'm convinced the United States is poised to really compete
in the manufacturing economy of this century, but we still face key challenges in the job market
for manufacturing.
"Instead of dictating job training standards from Washington, our bill allows local leaders to
build training plans that fit their unique needs," said Sen. Ayotte. "As I visit manufacturing
employers throughout our state, I've been hearing that they are challenged in finding the right
workforce for excellent paying jobs and opportunities. What they need are partnerships and
help to get that trained workforce in place... Our bill will allow local education institutions to
partner with private employers and state and local officials to ensure that the training is
valuable and everyone has a stake in ensuring we have the right workforce going forward."
More: Ayotte release | C-Span video

News -- Sen. Brown tours Byer Steel, unveils new legislation

Sen. Brown visited Byer Steel Group in Cincinnati to tour the facility and unveil new legislation
that would help level the playing field for American manufacturers by strengthening the ability
of the U.S. to crack down on unfair foreign competition resulting from violations of trade law.
The Leveling the Playing Field Act would ensure American companies have the resources
necessary to fight back against unfair foreign trade practices.
As American manufacturing continues its steady comeback, it is critical that we fully enforce
our trade laws to ensure that American companies like Byer Steel can compete on a level
playing field, Brown said. Thats why the Leveling the Playing Field Act is so important. We
must fight back against foreign companies efforts to weaken our trade laws and exploit
loopholes.
More: Brown release

News -- Sen. Baldwin testifies before International Trade Commission on

behalf of Wisconsin manufacturer

Sen. Baldwin (D-WI) testified at a hearing of the International Trade Commission (ITC) on behalf
of a Wisconsin paper company, Appvion of Appleton. Appvion is a pulp and paper mill that
manufactures and sells coated paper products world-wide and employs 1,644 employees in
Wisconsin, Ohio and Pennsylvania.
Sen. Baldwin addressed a 2008 antidumping investigation into imports of lightweight thermal
paper from China and Germany. As a result of the investigation, antidumping duties were
imposed on imports from Germany and China and countervailing duties were imposed on
imports from China. The antidumping duties are due to expire, and the ITC heard testimony
about how the domestic marketplace is impacted by dumping.
More: Baldwin release

News -- Sen. Shaheen gives speech on importance of STEM

Sen. Shaheen (D-NH) met with leaders of the University of New Hampshires Manchester STEM
Discovery Lab where she delivered remarks on the importance of Science, Technology,
Engineering and Math (STEM) education.
Initiatives like UNHs STEM Ambassadors program put us on the right track for economic
success, Shaheen said. Jobs in STEM fields are predicted to be the fastest growing occupations
in next decade, and with continued investments and commitments to STEM education, we can
make sure we have a homegrown talent supply that can drive our economy in the future.
More: Shaheen release

News -- Sen. Murphy launches Murphys Monday Manufacturer

Sen. Murphy (D-CT) launched a new weekly series called Murphys Monday Manufacturer, in
which one of Connecticuts manufacturers is recognized each week.
Sen. Murphy has recognized:
Severance Foods, the largest manufacturer and co-packer of tortilla chips in the
Northeast, with 90 employees.
Xamax Industries, a global supplier of engineered products such as fibers, papers, and
films, with 36 employees.
Polamer Precision, a contract aerospace manufacturer that produces engine and
airframe components, with 83 employees.
Moore Engineering, a family-run manufacturing business that performs high precision
Jig Grinding using family-developed machines, utilizes Electric Discharge Machines to
create products for particular geometries, specializes in custom fixtures for aerospace
applications, and even designs prototypes, with 4 employees.
Specialty Metal Fabrications, a veteran-owned manufacturer of precision metal
products with 30 employees.
Carlas Pasta, which produces pastas and pestos, with 171 employees.
Alinabal Holdings, a diversified manufacturer that manufactures products for the
defense, aerospace, industrial, recreational, and medical industries, with 325
employees.
More: Murphy release

News -- International Trade Commission imposes rebar duties

The International Trade Commission (ITC) determined that steel producers from Mexico and
Turkey have caused economic harm to U.S. steel reinforcing bar (rebar) manufacturers.
Mexicos producers were found to be dumping rebar into the U.S. market, while Turkeys
producers were found to be unfairly subsidizing their rebar exports. Following the ITC decision,
the Department of Commerce (DOC) will instruct U.S. Customs and Border Protection to collect
estimated duties for imports of rebar from Mexico and Turkey.
This decision follows a letter sent to the ITC urging the imposition of duties to protect U.S. rebar
manufacturers. The letter was led by Senators Graham (R-SC) and Pryor (D-AR), and signed by
Senators Wicker (R-MS), Hagan (D-NC), Cochran (R-MS), Stabenow (D-MI), Klobuchar (D-MN),
Merkley (D-OR), Manchin (D-WV), Boozman (R-AR), Schumer (D-NY ), Cornyn (R-TX), McConnell
(R-KY), Harkin (D-IA), Blunt (R-MO), Gillibrand (D-NY), Kaine (D-VA), Chambliss (R-GA), Fischer (RNE), Bennet (D-CO), Murray (D-WA), Begich (D-AK), Franken (D-MN), McCaskill (D-MO), Donnelly
(D-IN), Vitter (R-LA), Durbin (IL), Brown (D-OH), Booker (D-NJ), Warner (D-VA), Burr (R-NC),
Inhofe (R-OK), Isakson (R-GA), Sessions (R-AL), Scott (R-SC), and Shelby (R-AL).
More: ITC release | Senate letter

3. SECTOR DATA

==================================

Purchasing Managers Index (PMI)

November PMI was 58.7, a decrease of 0.3 from the October reading.
The PMI is a widely watched measure of aggregate manufacturing strength. PMI is based on a
survey that asks purchasing managers if Inventories, Supplier Deliveries, Employment,
Production, and New Orders have gone up or down that month. Results above 50 indicate
growth.
For November, Inventories read 51.5 (-1.0 on October), Supplier Deliveries read 56.8 (+0.6),
Employment read 54.9 (-0.6), Production read 64.4 (-0.4), and New Orders read 66.0 (+0.2). This
data is in chart form below. December figures will be released on January 2, 2015.
Change on
prior month
PMI
58.7
-0.3
Inventories
Supplier
deliveries
Employment
Production
New orders

More: ISM

-1.0

51.5
56.8

+0.6

54.9

-0.6
64.4

-0.4

66.0 +0.2

Employment

Preliminary estimates by the Bureau of Labor Statistics show that manufacturing employment
was up 28,000 in October, at a seasonally adjusted 12.2 million.

Manufacturing employees, millions

The below chart shows the total number of manufacturing employees over the last ten years in
millions of workers, as well as the month-on-month change in manufacturing employment over
the last six months in thousands. Both numbers are seasonally adjusted.
Month-on-month change, thousands
+21 +24
+20 +28
+3 +12

15
14

Jun Jul Aug Sep Oct Nov

13
12
11
'04

'05

'06

'07

'08

'09

'10

'11

'12

'13

'14

More: BLS

Fed Data

Manufacturing
production

100

78

99

77.2

98

77
76

97
96
May
Jun
Jul
Manufacturing production

75
Aug
Sep
Oct
Manufacturing capacity utilization

Manufacturing capacity
utilization

The Fed publishes monthly data on industrial production and capacity utilization. Industrial
production is represented as an index where the 2007 level equals 100. Capacity utilization is
shown as percent of capacity.
101
100.6 79

In addition to the Feds national data, six of the twelve Federal Reserve regional branches
publish monthly updates on manufacturing conditions in their region. Because each branch
uses different questions and methodology, interregional comparisons are not suggested.
More: Fed

New York Fed (NY state, 12 northern NJ counties, and Fairfield County in CT)
[B]usiness activity continued to expand for New York manufacturers. The headline general
business conditions index climbed four points to 10.2, indicating a pace of growth somewhat
faster than last months.
More: NY Fed
Philadelphia Fed (eastern PA, southern NJ, and DE)
[R]egional manufacturing activity increased notably in November. The surveys broadest
measure of manufacturing conditions, the diffusion index of current activity, increased from
20.7 in October to 40.8 this month and has now been positive for nine consecutive months.
More: Philly Fed
Richmond Fed (DC, MD, NC, SC, Virginia & most of WV)
Fifth District manufacturing activity grew modestly in November Manufacturing activity
slowed overall in November, with the composite index dropping to a reading of 4 from last
month's reading of 20.
More: Richmond Fed
Chicago Fed (southern WI, IA, northern IL, northern IN, and southern MI)
The Chicago Fed Midwest Manufacturing Index is currently suspended, while it undergoes a
process of data and methodology revision in 2014. The next release is preliminarily scheduled
for spring of 2015.
More: Chicago Fed
Kansas City Fed (western MO, NE, KS, OK, WY, CO & northern NM)
Tenth District manufacturing activity expanded at a slightly faster pace in November, and
producers expectations for future activity increased further. The month-over-month composite
index was 7 in November, up from 4 in October and 6 in September.
More: Kansas City Fed
Dallas Fed (TX, northern LA and southern NM)
Texas factory activity increased again in November The production index, a key measure of
state manufacturing conditions, fell from 13.7 to 6, indicating output growth slowed in
November.
More: Dallas Fed

U.S. Manufacturing Technology Orders (USMTO)

October U.S. manufacturing technology orders totaled $417.8 million, down 35.0% from
September, and down 6.2% when compared with October 2013.
With a year-to-date total of $4,150.4 million, 2014 is down 3.8% compared with 2013.
These numbers and all data in this report are based on the totals of actual data reported by
companies participating in the USMTO program. The chart below shows year-over-year change
and total orders on a national and regional basis.
Year-over-year
October
change (%)
orders ($m)
Total

417.8

-6.2

Northeast

na

na

Southeast

na

34.2

North Central-East
North Central-West

+0.2
-3.9

South Central
West

89.1
na

-0.9

106.5

na
na

More: AMT

4. ABOUT THIS NEWSLETTER

==================================
This update is provided by the Office of U.S. Senator Chris Coons on behalf of the Manufacturing
Jobs for America initiative. For more information, visit coons.senate.gov/manufacturing or
email jj_singh@coons.senate.gov or josh_boylan@coons.senate.gov.