Are We on the Verge of a Manufacturing Renaissance?

My father-in-law is a machinist who remembers the days when he would come home with the smell of oil and coolant on his clothes. That picture of US manufacturing has evolved into sleek factories with robots and automated processes where software supersedes elbow grease. The future of manufacturing is in automation, enabling manufacturers to do more with less.  

Is North America poised to make a manufacturing comeback, and what would that look like? The numbers tell an optimistic story, and some analysts say we are already experiencing a manufacturing renaissance. Government investment is helping to spur manufacturing growth with legislation like the Inflation Reduction Act. Investment in US manufacturing facilities reached nearly $225 billion in the first quarter 2024, a record high even after adjusting for inflation. In fact, the number of manufacturing plants in the US saw over 11% growth between early 2019 and mid-2023, reaching nearly 393,000 by the end of that time. In addition, when it comes to manufacturing jobs, we have surpassed pre-pandemic levels. 

The pandemic showed us how vulnerable our supply chain is and has encouraged more support for reshoring strategies. This means finding ways to rely on production and sourcing that is domestic or at least closer to home, boosting resilience in the supply chain. Despite these positive signs, however, there are still challenges to being “Made in America.” 

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The skills gap

Experienced machinists like my father-in-law are nearing retirement. The big question is – who will take their place? The skills gap in manufacturing is an ongoing hurdle, mainly because technology is advancing so fast, and the workforce is getting older. A recent report from Deloitte and the Manufacturing Institute highlights a significant shortage of skilled workers in the U.S. manufacturing sector. According to the findings, the industry could face a gap of up to 1.9 million workers by 2033 if the current talent shortfall is not addressed.

Building strong workforce development and training is essential with industry, schools and government working together to create programs that address the present and future needs of manufacturing. Smaller manufacturers face even bigger challenges in this area. Many don’t have the budget to invest in new technologies or provide comprehensive training for their teams. Even with more educational programs, however, manufacturers will need to embrace more automation to keep up with demand.

Connectivity in action

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The global manufacturing market is expected to hit around $8.8 trillion in value added this year. Indicators point toward a US manufacturing renaissance with automation playing a lead role and software and artificial intelligence (AI) as supporting characters. Manufacturing will become increasingly dependent on how well different systems can communicate and optimize operations. 

 Currently, much of the industry operates within siloed systems where information from one piece of software must be manually transferred to another. There is a desperate need for more software systems "talking" to each other, forming a cohesive chain of events that can trace what happened at each stage of the process, so you don’t lose information. 

A digital thread enhances automation. For instance, if a part is measured at the end of production and found to be incorrect, the manufacturer can trace the error back through the digital thread to identify where the issue occurred. This prevents similar mistakes from happening in future production runs, ultimately saving time and costs. Correcting issues earlier in the process reduces waste and increases overall efficiency.  

AI is also expected to take on a more collaborative role in the way manufacturers fine-tune operations with greater precision. For example, AI takes an action and presents the result, asking, “How does this look?” or “What should we do next?” This prompts the user to evaluate the outcome and provide feedback, helping to ensure continuous improvement and adaptation. As AI tools become more integrated into the larger software ecosystem, organizations can expect this interaction to grow more seamless.

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Changing workforce dynamics  

In business today, it is important to reduce manual intervention and maximize output in the face of a skills gap in U.S. manufacturing. Automation not only helps address a workforce shortage, but also free employees like my father-in-law to focus on more creative, impactful work.

As automation takes over repetitive and mundane tasks, human workers can concentrate on solving complex problems that machines cannot address. This realignment of roles enables workers to deliver higher value through creativity and innovation. By removing drudgery from the work environment, automation fosters more motivating and engaging job roles.

Just as my father-in-law's memories of oil and coolant symbolize a bygone era, today's factories embody a future where technology drives success. If North America is indeed poised for a manufacturing comeback, it will be through the lens of automation, paving the way for a modern industrial landscape that balances tradition with innovation.