Future of American Manufacturing

Dessein Jeremy
BA 3103 Sec003
Dr. Andrea Hornett

Assignment #6

Critical analysis #5
“Future of American Manufacturing”

Manufacturing in the US: First of all, "manufacturing" as defined by the BLS refers to "establishments engaged in the mechanical, physical, or chemical transformation of materials, substances, or components into new products." The United States is the world's largest manufacturer, despite manufacturing being a very small portion of the entire US economy as compared to most other countries. The United States is the world’s largest manufacturing economy, employing nearly 12 million Americans in the production of $1.6 trillion in manufactured products, representing 18 percent of the world’s manufactured goods.

The issue: A strong U.S. manufacturing base is essential for maintaining U.S. middle class and providing for U.S. national defense. The combination of the current global economic crisis and a decade-long series of bad policies and the lack of a national industrial strategy has created a steady drop in manufacturing jobs. We will critically analyze the manufacturing industry and show how they are impacted by corporate tax rate, free trade agreements and the burden of regulations. Finally we will find out possible alternatives what to do to improve the prospects for U.S. manufacturers.

Figure 1: presents a PEST analysis of the manufacturing industry employing

Political Factors   * Government spending for 2009   * Growth in Cross Border Activities   * Government policies   * Ecological/environmental regulations   * Tax Credit as example for R&D   * Employment law   * Competitive regulations   * International legislation     * International pressure from other manufacturing countries     * War, terrorism | Economic Factors   * US economy trends   * General Economic Trends   * Exchange rates   * International trade and monetary issues   * Investment for Modernization   * Taxation specific to product/services   * Job...