The Manufacturing Advancement Center Workforce Innovation Collaborative (MACWIC), a voluntary association of more than 90 manufacturers and institutions organized to identify and solve workforce-related business needs, has been selected to receive the 2013 John Gould Education & Workforce Development Award at AIM’s 98th Annual Meeting on May 10 in Waltham.
The Manufacturing Advancement Center in Worcester is an affiliate of the Massachusetts Manufacturing Extension Partnership (MassMEP).
The Collaborative is being honored for its groundbreaking work to develop a competency-based curriculum for precision machining that ensures students will have the ability to meet prescribed industry standards. The curriculum can ultimately lead to college credit.
Approval of a standardized curriculum has also led the Collaborative to create the Manufacturing Skills Academy - an industry-supported initiative to upgrade the skills of the current workforce. Currently, academy training modules in subjects such as Shop Math, Blue Print Reading, CNC Mill Concepts and Statistical Process Control are being conducted in Worcester at the MassMEP office and the Worcester Technical High School, at the Shawsheen Valley Regional Vocational High School in Billerica, and locations of participating employers.
“AIM applauds the Collaborative and its members for developing industry credentials, fostering communication within the manufacturing community and promoting vocational education,” said Richard C. Lord, President and Chief Executive Officer of AIM.
“As the Collaborative achieves success in upgrading the skills of the incumbent workforce, entry-level positions will open up, creating opportunity for new hires.”
Lord said, “The development of a new employer-driven workforce training initiative is critical in order to deal with impending baby-boomer retirements that are expected to create almost 100,000 manufacturing job vacancies in Massachusetts during the next 10 years. AIM is delighted to honor the MACWIC with the 16th annual Gould Award.”
The Gould Award was created by AIM in 1998 to recognize the contributions of individuals, employers, and institutions to improving public education and the advancement, employability, and productivity of residents of the Commonwealth. Named for John Gould in 2000 upon his retirement as President and CEO of AIM, the award recognizes his many contributions to improve the quality of public education and workforce activities in Massachusetts.
As the 2013 winner of the Gould Award, the Manufacturing Advancement Center Workforce Innovation Collaborative joins past recipients John Rennie, founder of the Massachusetts Business Alliance for Education; Middlesex Community College, NYPRO, Inc.; William Edgerly, Chairman Emeritus, State Street Corporation; Northeastern University; The Davis Family Foundation; Intel Massachusetts; EMC Corporation; IBM Corporation; David Driscoll, former commissioner of the State Department of Education; Raytheon Corporation’s MathMovesU program; State Street Corporation and Year Up Boston; Beth Israel Deaconess Medical Center; the Massachusetts Manufacturing Extension Partnership M.O.S.T. Program; and Brockton High School.
There are few entities capable of increasing U.S. manufacturing output by $50 billion all by themselves.
That’s why the announcement by retail giant Walmart that it will significantly increase domestic sourcing of the products found in its stores provides such a shot in the arm to the growing movement by manufacturers to return production to the United States.
The world’s largest retailer announced on January 15 that Walmart and Sam’s Club will buy an additional $50 billion in U.S. products during the next 10 years. The company said it plans to grow U.S. manufacturing on two fronts: by increasing what it already buys here in categories like sporting goods, apparel basics, storage products, games, and paper products; and by helping to onshore U.S. production in high potential areas like textiles, furniture and higher-end appliances.
“At the heart of our national political conversation today is one issue: creating jobs to grow the economy,” said President and Chief Executive Officer Bill Simon. “We are meeting with our suppliers on domestic manufacturing and are making a strong commitment to move this forward.”
Two-thirds of the products that appear on Walmart store shelves in the United States are made, sourced or grown domestically, according to data from the company’s suppliers. The company says it sees room to do more and will collaborate with manufacturers by giving them long-range demand forecasts, making longer-term product commitments on basic goods and helping to connect them with the best resources so they can make informed decisions about capital investments.
Announcement of the Walmart initiative comes as companies such as General Electric, which resumed making appliances at its sprawling Appliance Park campus in Louisville, Kentucky, have begun to repatriate manufacturing operations that previously moved overseas. Research by the MIT Forum for Supply Chain Innovation found that manufacturers are reconsidering their supply chain strategies due to higher labor costs in developing countries, energy costs and political stability issues.
The trend is good news for Massachusetts, where manufacturing employment has stabilized after a sharp decline during the recession. Manufacturing output in the Bay State surged more than 20 percent from 2010 to 2011.
Brian R. Gilmore, Executive Vice President of Associated Industries of Massachusetts, said AIM looks forward to supporting the sourcing initiative by Walmart, a longtime member of the association.
“You cannot underestimate the effect of having the largest single buyer in the world make such a clear commitment to American manufacturing. We urge other retail companies to join the effort,” Gilmore said.
Walmart said buying products in the U.S. helps both its own efficiency and the overall U.S. manufacturing base.
“This could create jobs in areas such as manufacturing and industrial engineering, shipping and transportation, management, accounting, large equipment maintenance, and service providers like medical, retail, restaurants, uniforms and foodservice,” the company said in a statement.
“Products made closer to the point of purchase mean increased flexibility because of shorter transportation time, lead time and less freight costs. This offers the ability to save additional costs in warehousing and multiple touches through the supply chain.”
The American Taxpayer Relief Act of 2012, which pulled the nation back from the “fiscal cliff” on January 1, contained two provisions of interest to manufacturers—extension of the Research and Development (R&D) Tax Credit that expired in 2011, and enhanced Section 179 capital expenditure deduction limits for 2013.
The National Institute of Standards and Technology’s Hollings Manufacturing Extension Partnership (MEP) reports that the bill extended the R&D tax credit retroactively to January 1, 2012 through December 31, 2013. While the measure has never been a permanent part of the U.S. Tax code, it has always gathered strong bi-partisan support to be extended on a temporary basis.
Since the IRS eliminated some of its restrictive language in 2004, the R&D credit has been increasingly valuable for manufacturers that employ engineers or engage in product and process testing. The R&D credit benefits manufacturers of all types, including those that design and develop their own products as well as those that make parts for their OEM customers.
The MEP reports that about 70 percent of the credit dollars are derived from the salaries of employees devoted to qualified research activities, making it a wage-based credit available to a variety of manufacturing enterprises.
A second provision of the tax act extended the U.S. tax code’s Section 179 tax deduction. The 179 deduction allows companies to deduct the entire purchase price of qualifying office equipment, software, and other business needs in one year, rather than over the typical five-to seven-year depreciation schedule.
Manufacturers should check out how these two provisions may impact their operations.
At a time when manufacturing employers are struggling to find skilled workers, a unique initiative from the Massachusetts Manufacturing Extension Partnership is about to graduate its second class of 12 CNC machine operators trained at Worcester Polytechnic Institute (WPI).
The Massachusetts More Skilled Workers Program is funded by a grant from the U.S. Department of Labor’s Employment & Training Administration. The training takes place within a 280-hour instruction program that includes:
- 80 hours of foundational manufacturing skills;
- 100 hours of advanced CNC skills training at WPI;
- 40 hours of MasterCAM;
- 30 hours of career readiness;
- 20 hours of Math Boot Camp instruction; and
- the OSHA 30-hour General Industry course.
Employers who hire the graduates are eligible for a $10-per-hour wage reimbursement for 18 weeks ($7,200) to offset the cost of on-the-job training. Most candidates also qualify for the state’s Hiring Incentive Training Grant ($2,000) for training veterans or residents unemployed for six months or more.
The training course is part of a larger credentialing system developed by Bay State employers to identify skills that are critical for success in high-value manufacturing. The 280 hours of instruction satisfy three steps of a five-step system, called the Applied Manufacturing Technology Certification Pathway, that can lead to an associate’s degree in manufacturing technology. The Massachusetts Association of Vocational Administrators has incorporated the credentialing model into the vocational technical educational frameworks that underlie the Manufacturing, Engineering and Technology curriculum.
The employers behind the new credentialing system work under the name of the Manufacturing Advancement Center Workforce Innovation Collaborative. MACWIC is an alliance of next-generation manufacturers seeking to identify workforce-related business needs and to drive solutions, especially skills training.
And MACWIC members are developing the skills of current, as well as future, manufacturing workers. The organization has created a Manufacturing Skills Academy Network made up of member companies, partners, and individuals committed to developing manufacturing talent. Staffed by member companies, the initiative allows workers to keep pace with rapidly changing technology and maintain Massachusetts' global competitiveness.
Employers who wish to review resumes for each of the participants in the current CNC class on line can go to StemPower.
Editor's Note - Brian Gilmore is Executive Vice President of Public Affairs at AIM and a member of the Massachusetts Advanced Manufacturing Collaborative.
Employers, state officials and academics met yesterday to ensure the growth of manufacturing in Massachusetts.
The Massachusetts Advanced Manufacturing Collaborative (AMC) held its first formal session in Boston after being formed by the Patrick Administration and endorsed by the Legislature to enhance the competitiveness of Bay State manufacturers.
The Collaborative has several objectives:
- Elevate public understanding of the capabilities and potential of advanced manufacturing in the commonwealth;
- Expand the ability of the state’s educational system to respond to the entry and mid-level skill needs of manufacturers in the state;
- Improve access for small-to-mid size manufacturers to technical assistance that supports manufacturing growth, including access to business credit, workforce development, compliance certification, export assistance, and innovation
- Ease the cost of doing business in the state.
The Collaborative used its inaugural meeting to hear progress reports on each of those objectives. The group also spoke with Lt. Governor Timothy Murray the merits of conducting an Advanced Manufacturing Summit in the spring and discussed the results of a new study that indicated a need to fill nearly 100,000 manufacturing jobs during the decade as older workers retire.
Manufacturing jobs totaled 250,656 in the first quarter of 2012; health care and social assistance jobs topped the list with 515,047 and the retail trade came in second with 343,312 jobs; Professional and technical services jobs totaled 260,791 and accommodation and food services had 252,280 jobs, according to figures from the Executive Office of Housing and Economic Development.
Many people are stuck in an “old cognitive map, thinking of manufacturing as old smokestack businesses that lack appeal for younger workers,” said Barry Bluestone, a professor at Northeastern University.
“This is a problem we have,” Bluestone told Statehouse News Service. “We are so focused on going to college and getting a degree in finance and health sciences, we forget there are 10,000 jobs a year in manufacturing.”
In a survey of manufacturers, approximately two-thirds said they expect to expand their businesses in the near future, something that could prove difficult if they cannot find workers, Bluestone said.
AIM has a designated seat on the Collaborative, and will participate with representatives from several AIM member firms, including Raytheon, NYPRO, the Custom Group, Massachusetts Manufacturing Extension Partnership, and Universal Plastics. Manufacturing employers with ideas for the Collaborative should contact me at email@example.com.
Manufacturers and other companies entitled to local property-tax benefits must now file online with the Massachusetts Department of Revenue (DOR) to claim those benefits.
Corporations seeking to maintain favored property-tax status must file an Annual Certification of Entity Tax Status between now and April 1 to ensure that they appear on DOR’s Division of Local Services List of Corporations for 2013. Cities and towns use “The List” to determine which corporations and entities treated as corporations are entitled to local property tax benefits. The List also specifies all entities treated as business corporations for Massachusetts tax purposes that have been granted the “manufacturing corporation” classification.
Joseph X. Donovan, a tax lawyer at Sullivan and Worcester, says tax law changes in 2009 meant that the Department of Revenue could no longer use filings with the Secretary of the Commonwealth to alert local officials about the tax status of a company.
“While the change to a new procedure was necessary, there is a real risk that companies that are unaware of the requirement for the first time to make an annual filing to protect favored local property tax status will find themselves effectively declassified, with potentially very harsh consequences,” Donovan said.
“While they will be able to cure the declassification by challenging it in the Appellate Tax Board, that route can be quite costly, and resolution of any dispute before the Board can take a long time. We should hope that taxpayers that find themselves before the Board in such circumstances will be permitted to quickly and informally resolve with opposing counsel the ‘foot fault’ of failure to file the form.”
The DOR publishes The List electronically on its Web site on or about April 1. Omission from the list or any particular classification may be appealed by the employer.
Here are some resources for employers:
AIM applauds the DOR’s effort to improve the accuracy of this list and to streamline administrative matters. The association has encouraged the DOR to find additional ways to streamline policies for collecting data on local property tax classification. Should you have any suggestions or questions, please contact Brad MacDougall, Vice President for Government Affairs or 617-262-1180.
Barry Bluestone, Professor Professor of Political Economy at Northeastern University, spoke to the AIM Public Affairs Council and Board of Economic Advisors Friday about his new study: Staying Power II: A Report Card on Manufacturing in Massachusetts.
The Massachusetts Department of Public Safety has developed proposed regulations that could exempt hundreds of manufacturing and warehouse companies from burdensome rules for licensing people who operate forklifts, overhead cranes and other hoisting equipment on company property.
State law requires individual licenses for every operator of even smaller pieces of hoisting equipment commonly used in smaller manufacturing facilities, retail outlets, warehouses and warehouse- type stores. AIM worked with state regulators two years ago to pass a law - signed by Governor Deval Patrick on October 14, 2010 - allowing the Department of Public Safety to streamline the existing regulations.
The proposed new regulations would expand the current exemption from the licensing and permitting requirements for public utilities to include companies operating certain hoisting equipment solely on company property - provided certain conditions are met. In order for the exemption to apply, the company must, among other requirements, have an employee training program approved by the commonwealth that meets the specifications of the new regulation.
The rules also impact temporary permits that may be issued by a short-term rental entity for the operation of compact hoisting machinery.
Individuals or organizations seeking to offer continuing education courses for individuals to be licensed to operate hoisting machinery must submit an application to the department. All courses must be monitored by a Massachusetts hoisting license holder and must offer a curriculum that, at a minimum, complies with detailed requirements for each class of hoisting machinery, as outlined in the proposed regulation.
The Department of Public Safety will be hold a public hearing to solicit comments on the proposed regulation on December 3 at 10 am at One Ashburton Place, Boston. Written comments are due by December 3. These new regulations may offer significant relief for entities using this equipment solely with the confines of their own property, but AIM urges all employers to review the proposed rules and contact us with comments.
The proposed regulation can be found here.
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Massachusetts has launched a statewide effort to encourage young people to consider careers in advanced manufacturing.
AMP it up!, developed as part of the Patrick administration’s Advanced Manufacturing Agenda, seeks to address a persistent shortage of qualified workers in key manufacturing industries. A recent state report card on manufacturing reported that upwards of 100,000 manufacturing jobs will need to be filled during the next several years.
Officials say AMP it up!, is designed to change the perception of manufacturing in Massachusetts and to present advanced manufacturing as an attractive career alternative. The campaign with reach out to parents, teachers and counselors to clear up misconceptions about the manufacturing with the ultimate goal of bolstering the prospective employee base for these quality jobs.
Manufacturing companies across the state are invited to submit ideas for content on the AMP it up! Web site produced by MassDevelopment. Employers may suggest ideas by contacting Brenda Doherty at 800-445-8030.
Tomorrow is the first national Manufacturing Day, reminding us that the United States still leads the world in production of manufactured goods and that the manufacturing sector is at the core of our economy.
Manufacturing is coming back from the recession. It may also be coming back from overseas. The 2012 U.S. Re-shoring Survey by the MIT Forum for Supply Chain Innovation finds that manufacturers are reconsidering their supply chain strategies due to higher labor costs in developing countries, energy costs, political stability issues, and time-to-market concerns.
The survey finds that re-shoring – bringing manufacturing back to the U.S. from overseas facilities – is under consideration by a significant number of firms. Others, including auto parts and electrical equipment manufacturers, have already moved operations back. Federal and state policies, including corporate tax rates, have a major impact on decisions to move or stay.
Here in Massachusetts, “manufacturing is alive and well, and has a healthy future,” according to a recent report entitled Staying Power II: A Report Card on Manufacturing in Massachusetts, by Professor Barry Bluestone and his team at Northeastern University.
Some key findings of the report about Massachusetts manufacturing today:
- Manufacturing employment has stabilized after a sharp decline during the recession;
- Manufacturing is the state’s six-largest employment sector – and the second-largest (after health care) in terms of payroll;
- Manufacturing’s share of gross state product has risen for the past two years, to 12.2 percent;
- The number of manufacturing firms increased in 2011 for the first time in decades;
- Manufacturing is more technologically intense than ever; in 1970 employment in low-tech sectors was twice that in high-tech; in 2006 they were equal, and by 2010 high-tech was 27 percent larger;
- Most Massachusetts manufacturing companies are small and family-owned;
- The manufacturing workforce is more diverse than the overall state workforce; and
- Although most jobs in manufacturing are now “white collar,” only about one position in five requires a college degree
While cost issues and global competition are challenges, the study finds, the skills and work ethic of the state’s workforce are powerful reasons to stay in Massachusetts. But employers are already experiencing difficulty in hiring skilled workers, and an upcoming wave of retirements will create up to 100,000 job vacancies over the next ten years. The 70 percent of manufacturing firms foreseeing expansion of employment over the next five years must face up to this “recruitment challenge” by focusing on workforce development and promoting manufacturing careers.
In this election year, candidates across the country, from President Obama and Governor Romney on down, have jumped onto the manufacturing bandwagon. Beacon Hill has cut the corporate excise tax, passed bills to control medical and energy costs, strengthened the Workforce Training Fund Program and community colleges, and created the industry-led Massachusetts Advanced Manufacturing Collaborative. Nationally, however, the reality has been partisan deadlock.
If Congress really cares about manufacturing, there are issues that demand immediate action. Most urgent is heading off about $500 billion in tax increases that will hit the U.S. economy on January 1, along with huge automatic spending cuts. The top tax rate on dividends will almost triple, the top tax rate on capital gains will increase by more than half, and many small and mid-size manufacturers will see their top marginal tax rate rise, because nearly 70 percent of manufacturers file taxes at individual rates. The Research and Development tax credit expired for the fifteenth time at the end of 2011. And the U.S. corporate tax rate is the highest in the developed world. Action in other areas is equally vital, if less pressing. For example, the future of workforce development programs, largely shaped by federal policy, remains up in the air.
America’s manufacturing sector, historically the backbone of our economy and of upward mobility in our society, is entering a period of renewed opportunity. We need congressional action, now, to ensure that future expansion takes place here rather that abroad.