Can a President Really Grow Manufacturing?

clean energy symbols like electric cars and windmills on the blue side under the donkey, and a pickup truck with oil rigs on the red side under the elephant. This should further highlight the contrast in political ideologies, while keeping the manufacturing center unaffected by the chaos.

As the upcoming election draws near, the revitalization of American manufacturing has once again become a central theme in political discourse. Presidential candidates are making ambitious promises to bring back factory jobs and strengthen the industry. However, for manufacturing professionals in Michigan—a state with a rich industrial heritage—the pressing question is: How much can a president truly influence the revival of manufacturing, and what local opportunities are shaping the industry’s future? This recent New York Times article asked that question. In this blog, we examine how the election could affect jobs here in Michigan. 

Political Proposals vs. Economic Realities

Former President Donald J. Trump proposes imposing hefty tariffs on nearly all imports to encourage foreign companies to produce goods in the United States. Vice President Kamala Harris, meanwhile, advocates for tax credits and expanded apprenticeships to bolster factory towns and invest in advanced technologies. While these proposals make for compelling campaign narratives, historical evidence suggests that no president can single-handedly dictate the growth of specific industries.

Economic forces such as global market trends, technological advancements, and exchange rates often have a more significant impact on manufacturing. While federal policies can provide incentives and create a favorable environment, the real drivers of manufacturing growth are often found at the state and local levels.

Sun Belt States: The Rise of Business-Friendly Environments

In recent years, manufacturing jobs have been migrating toward the Sun Belt states—such as Texas, Florida, and those in the Southeast—known for their business-friendly climates. These states offer lower taxes, fewer regulations, reliable access to power, and a growing workforce attracted by a lower cost of living and favorable weather.

Nevada, for example, has seen its manufacturing job base grow by more than 13% from early 2020 to March 2023. The state has actively worked to diversify its economy beyond hospitality and entertainment, offering incentives and a welcoming atmosphere for manufacturers. Companies like Alliance North America (ANA) have relocated there, attracted by lower operational costs and a supportive business environment.

“Instead of companies choosing the right location based on all of their other requirements and the presumption that the workers are going to come to them, companies are starting from the presumption of, where are the people moving to?” said Didi Caldwell, president and CEO of Global Location Strategies.

Michigan’s Manufacturing Landscape: Leveraging Local Opportunities

Michigan offers a variety of subsidies and incentives designed to lure businesses and encourage expansion:

  • Michigan Business Development Program (MBDP): Provides grants, loans, and other economic assistance to businesses that create qualified new jobs and make new investments in Michigan.

  • Industrial Property Tax Abatement (PA 198): Offers property tax incentives to manufacturers looking to renovate or expand facilities, reducing costs associated with property improvements.

  • Michigan New Jobs Training Program (MNJTP): Assists employers in training workers for new positions by providing flexible funding to meet the demand for skilled labor.

  • Michigan Reconnect Program: Aims to help adults over the age of 25 earn a tuition-free associate degree or skilled trade certificate. This program enhances the workforce by providing manufacturers with a pool of skilled workers trained in advanced manufacturing techniques.

  • Good Jobs for Michigan Program: Provides incentives for businesses that create a significant number of high-paying jobs, aiming to boost the state’s economy and employment rates.

These programs underscore Michigan’s commitment to fostering a business-friendly environment, reducing operational costs, and supporting workforce development—a critical factor for manufacturers considering relocation or expansion.

Candidates Kamala Harris and Donald Trump have different ideas how to grow manufacturing in the USA.

Case Study: Michigan’s Attractiveness to Manufacturers

Several companies have taken advantage of Michigan’s incentives to grow their operations:

Ford Motor Company’s Electric Vehicle Investment: Ford has announced significant investments in Michigan to expand electric vehicle production, leveraging state incentives to modernize facilities and retrain workers.

LG Energy Solution’s Battery Plant Expansion: In Holland, Michigan, LG Energy Solution is expanding its battery manufacturing plant, supported by state grants and tax incentives aimed at boosting the clean energy sector.

These developments highlight Michigan’s strategic focus on not only preserving its manufacturing legacy but also pivoting towards emerging industries like electric vehicles and renewable energy technologies.

Balancing Local Advantages with National Trends

While the Sun Belt states offer attractive environments for manufacturers, Michigan’s unique combination of incentives, skilled workforce, and infrastructure continues to make it a compelling choice for manufacturing professionals.

Manufacturers in Michigan benefit from:

Skilled Workforce: Michigan boasts a rich pool of skilled labor, thanks to its strong educational institutions and programs like the Michigan Reconnect, which enhances workforce skills by providing tuition-free pathways for adults seeking degrees or certificates in high-demand fields.

Infrastructure and Logistics: The state’s robust transportation network—including major highways, railroads, and ports—facilitates efficient distribution and supply chain operations.

Community and Government Support: Local governments often work closely with businesses to streamline permitting processes and provide assistance, enhancing the ease of doing business.

Cautious Optimism Amid Uncertainty

Despite the positive local factors, the manufacturing industry remains cautious due to broader economic uncertainties and the impending election. Companies are mindful that the outcome could influence taxes, trade policies, and regulations.

“We’re a couple of months away from a huge decision point—who controls Congress and the White House,” said Timothy Fiore, manufacturing business committee chair at the Institute for Supply Management. “I think we’re kind of stuck here until the end of the year.”

Seizing Opportunities in Michigan While Recognizing National Trends

For manufacturing professionals in Michigan, the path to revitalization lies in leveraging state-specific incentives and opportunities while staying aware of national trends like the growth in Sun Belt states. While federal policies and political promises can influence the broader landscape, it’s the tangible, local actions that create a conducive environment for growth.

Michigan’s commitment to supporting manufacturing through various incentives, workforce development programs like Michigan Reconnect, and a business-friendly climate positions it as fertile ground for industry expansion. As the election nears, industry stakeholders should focus on these local advantages, ensuring they are well-positioned to capitalize on the opportunities ahead, regardless of political outcomes.

Whiplash Economy: The Impact on Manufacturing Jobs

If 2024 has taught us anything, it’s that the economy is like a rollercoaster you never quite signed up for. Earlier this month, we had a less-than-stellar jobs report—cue the collective sigh of disappointment. The U.S. economy added fewer jobs than expected, falling short of projections and rattling market confidence. For a moment, it felt like the rug was being pulled out from under us again, especially for the manufacturing sector, which has been caught in a downward spiral for most of the year.

Early August Panic and Sudden Recovery
In the days following the jobs report, the market had a brief but intense panic attack, reminiscent of the wild whipsaw reactions we’ve become accustomed to in recent years. The Dow took a dive, dragging spirits down with it. Analysts began sounding the alarm, predicting that the economy was losing steam faster than anticipated. Manufacturing, already battered by supply chain woes and fluctuating costs, braced for another blow as hiring seemed destined for the slow lane.

But just as we were buckling up for more turbulence, the narrative flipped. Inflation data started showing a much-needed cool-down, and suddenly, the Fed’s iron-fisted grip on interest rates seemed ready to loosen. The markets, always fickle, reversed course, with stocks rebounding almost as quickly as they had fallen. The prospect of a Fed rate cut in September emerged, injecting a dose of optimism into an economy that had seemed on the brink just days earlier.

The Tug-of-War on Manufacturing Jobs
For the manufacturing sector, these back-and-forth waves have been particularly jarring. On one hand, the disappointing jobs report raised fears of continued layoffs and a tightening labor market. On the other, the improving economic indicators like cooling inflation and strong retail performance from giants like Walmart offer a glimmer of hope. Could this finally be the turn manufacturing has been waiting for?

There’s a case to be made for cautious optimism. If the Fed does cut rates in September, manufacturers could see lower borrowing costs, which might prompt some to invest in growth and, by extension, jobs. Stable input costs, driven by cooling inflation, would also provide much-needed relief. But let’s not break out the champagne just yet. The sector is still licking its wounds from earlier in the year, and hiring might remain conservative until there’s more certainty that this recovery isn’t just another false dawn.

Navigating the Mixed Signals
The economy’s current state is like a rickety bridge, wobbling under the weight of mixed signals. For every piece of good news, like the potential for a Fed rate cut, there’s a reminder of the fragility that still exists, such as the weak jobs report. Manufacturing, as always, is caught in the middle. The sector’s recovery will likely be slow and uneven, with businesses cautious about adding to their workforce until they see sustained signs of stability.

In the meantime, manufacturing workers and employers alike will need to stay agile, navigating these unpredictable waters with a mix of hope and pragmatism. The economy may be sending out mixed signals, but one thing is clear: the ride is far from over.

You’re Doing Great! New Report Says Worker Confidence Is Soaring.

three workers in factory gear give a thumbs up in approval

As 2023 wrapped up, American workers started feeling a lot more hopeful about their jobs, marking a big change after a tough year. The latest U.S. Worker Confidence Index (WCI) for the last quarter shows that workers are feeling better than ever, giving us all a reason to be optimistic as we step into Q2 of 2024. Today, we look into why workers are feeling more confident and what it might mean for jobs and the economy moving forward.

The start of 2023 was shaky for many workers across the U.S., with worries about the economy, job security, and other global issues. But by the end of the year, things took a positive turn, and the WCI hit an all-time high. This isn’t just a random good news story—it shows that the economy is getting stronger and the job market is bouncing back.

The WCI measures how workers feel in four key areas: job security, chances of getting a raise, chances of getting promoted, and how much they trust their company’s leaders. The score shot up to 114.9 points, which is really impressive, especially after it was dropping for most of 2023. Workers are now more optimistic about moving up in their careers and believing in their company’s leadership than they’ve been in a while.

Even with the overall positive vibe, not everyone is feeling secure about their jobs. The Job Security Index dipped a little, showing that while some people are feeling more secure, others, especially men and workers in their prime years, are not as confident. This mix of feelings shows that there’s still some work to do to make everyone feel stable in their jobs.

A big highlight from the last quarter is that workers are really optimistic about getting promoted and getting raises. The scores for these areas jumped up a lot, turning around the downward trend from before. This means that more people believe they’ll move up in their careers and get recognized with better pay.

Trust in company leaders also went up, which is great news. When workers believe in their leaders, it makes for a better work environment, especially during uncertain times. Nearly half of the workers now feel good about their company’s leadership, which is a big step forward.

three men in a factory wearing factory gear all stand shoulder to shoulder in approval of their jobs. They seem happy.

The Bigger Economic Picture

The rise in worker confidence comes at a time when the U.S. job market is doing well, and the economy is picking up. The last quarter saw a lot of new jobs, especially in healthcare, hospitality, and government. Despite challenges like higher interest rates and inflation, the strong job market and growing consumer confidence show that the economy is on the right path.

Looking ahead to 2024, there’s a cautious but real sense of optimism. The economy and job market are expected to keep getting stronger, though the pace might slow down a bit. It’s important for companies to keep listening to their workers, especially when it comes to job security and career growth.

Why Worker Confidence Matters

The insights from the WCI are not just numbers; they show us how American workers are feeling overall. High confidence can lead to better work, more creativity, and stronger loyalty to companies. On the flip side, when workers aren’t feeling great, it can hurt productivity and morale. That’s why it’s crucial for companies to keep an eye on how their employees are feeling.

The last quarter of 2023 showed us that despite challenges, American workers are feeling hopeful and confident about the future. This is great news for everyone. For businesses, it’s a reminder of how important it is to create a positive work environment where employees feel valued and supported. Moving into 2024, we’ll all benefit from keeping the momentum going and making sure workers continue to feel confident and satisfied with their jobs.

Lack of Labor: Can America Fill Its Factories?

a sparsley populated factory in blue and orange tones. in the forefront is a help wanted sign.

As Michigan experiences a significant resurgence in manufacturing jobs, factory leaders and HR professionals are at a pivotal crossroads. The challenge? Addressing the stark workforce gap that threatens to slow this industrial reawakening.

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Unemployment Insurance Fraud: A Drain On Us All.

GAVEL AND HANDCUFFS WITH TEXT: unemployment insurance fraud prevention week

As we observe Fraud Awareness Week, it’s crucial to shine a spotlight on the ongoing battle against Unemployment Insurance (UI) fraud and the dedicated efforts of teams like ours at WSI Recruitment and Staffing in safeguarding the integrity of the labor market

In the ever-changing landscape of employment, Unemployment Insurance (UI) fraud poses a significant challenge, affecting not just the state funds but also the integrity of businesses and the welfare of legitimate claimants. This week, we’re taking a moment to highlight and celebrate the tireless efforts of our WSI Recruitment and Staffing Risk team, who play a crucial role in investigating claims and preventing UI fraud, thus helping keep taxes and government waste down, ensuring our business stays competitive, and safeguarding our clients from fraudulent claims.

Understanding UI Fraud

UI Fraud is a serious offense that involves individuals misrepresenting information to claim unemployment benefits unlawfully. This deception can take many forms, from claimants working while collecting benefits without reporting earnings, to employers misclassifying employees to evade taxes. The consequences are far-reaching, increasing unemployment taxes for businesses, burdening legitimate claimants, and straining the state’s unemployment funds.

Our Response to UI Fraud

At WSI Recruitment and Staffing, our dedicated Risk team members, Jade and Suzette, are constantly vigilant, employing strategies to detect and prevent such fraudulent activities. By staying informed about the latest fraud trends, diligently investigating all unemployment claims and injuries for WSI Associates, and implementing robust verification processes, we’re not just protecting our business but also contributing to a more honest and efficient labor market.

 

Recent Cases and State Actions

Michigan has witnessed a range of UI fraud cases, emphasizing the need for constant vigilance. From individuals exploiting the identities of prison inmates to fraudulent activities involving state contractors, these cases underscore the varied and sophisticated nature of UI fraud. The state’s response, including the formation of a UI Fraud Response Team and updated directives, has been pivotal in combating these challenges.

Protecting Against Fraud

Our team stays ahead of the curve, using resources and directives available to protect against identity theft and other forms of fraud. This proactive stance not only shields our business but also ensures that our clients are not unduly burdened by fraudulent claims.

The fight against UI fraud is ongoing, and our Risk team at WSI Recruitment and Staffing remains committed to this cause. Through their diligence, we continue to foster a business environment that is both competitive and ethical, benefiting our clients and the broader community. 

Reporting UI Fraud

Awareness and prompt reporting are key in fighting UI fraud. If you suspect fraudulent activities, it’s essential to report it immediately through the official channels. This proactive approach is a critical step in safeguarding the integrity of the unemployment insurance system.

Fraud or scam reports may be made to the Consumer Protection Division of the Michigan Attorney General’s office at 517-335-7632, toll free 1-877-765-8388, or online.

Resilient Labor Force in Changing Times: An Opportunity for Employers

As wages stabilize, employers should take note that labor negotiations and their impact are actually presenting a golden opportunity to increase their labor force.

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