Broken Promises: Candidates Struggle With Manufacturing Jobs

It's become a staple of every presidential campaign over the years. Candidates from both parties walk through a manufacturing plant and talk about how they will bring back the millions of blue collar jobs America has lost over the years.

In political terms, it's a can't miss photo op.

The reality paints a far different picture. Like it or not, U.S. manufacturing has not returned to the level of job creation many politicians, including President Barack Obama have promised.

Remember in the summer on 2012 when President Obama gave his nomination acceptance speech and promised to create one million manufacturing jobs in his second term.

Three years after that pledge, the U.S. is far from reaching that goal.

"During the downturn we lost 2.3 million workers in manufacturing, that is about one in every four of the total 8.7 million (jobs) that was lost," said Bill Strauss, an economist with the Federal Reserve in Chicago who specializes in studying manufacturing. "We have recovered less than 40 percent of the lost workers, just shy of 600,000 workers have gotten their jobs back."

Nobody knows that reality more intimately than Jim James, Chairman and CEO of Ideal Industries, a toolmaker with almost 2,000 workers spread across sixteen plants in the U.S..

Ideal is currently in the process of cutting up to 150 jobs at its plant in Colorado Springs, Colorado as the company struggles to stay competitive with companies spending less to build tools at foreign plants.

"We have to be innovative where we are going to create products that are going to differentiate us from what is being brought in from offshore. We have to be very, very efficient." said James as he showed us the company's plant in Sycamore, Illinois.

It's the constant push for efficiency and profitability that has transformed America's manufacturing base.

Twenty years ago, when companies started moving their production overseas in search of cheaper labor, the plants that remained were forced to become far more efficient, using fewer workers to crank out more products.

But what about those plants that have left the U.S.? Republican Presidential candidate Donald Trump says he'll get them to come back if he is elected.
“I’ll bring back our jobs from China, from Mexico, from Japan, from so many places. I’ll bring back our jobs, and I’ll bring back our money," he said in announcing his nomination in June.

James applauds Trump's enthusiasm for restoring America's manufacturing base, but he doubts the candidate can keep that promise.

"I think it is really hard to think you can force people back here and still be able to get somebody to buy your product at a higher cost," said James. "It really comes down to can your customers afford the price of your product? That is really what it comes down to.”

Strauss says manufacturers in America shouldn't be judged strictly on how many people they employ.

“It’s been a real struggle to bring people into this industry and I think to focus on that (employment number) as a gauge of the health of the industry is a mistake.”
In fact, the output from America's manufacturers has been increasing at an annual pace of 3.5 percent in recent years while the growth rate for the rest of the economy has been just 2.2 percent.

"We are on the verge of getting a record high in the amount of manufacturing in the economy," said Strauss.

Meanwhile, James is hoping his company can eventually re-hire those workers being laid off. His plan calls for investing in robotics and automation to make Ideal's facility in Colorado Springs more competitive and then start adding workers again.

“Sometimes you have to go backwards to go forwards," he said. "The good news is we do have a lot of new innovation, new products that are just getting scaled up into the factory and we believe in a couple years we are going to be adding jobs back”

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