State leaders, manufacturing heads don’t talk enough — and this is problem for $156B sector

Recent State of the State of Manufacturing showed disconnect

When the New Jersey Manufacturing Extension Program held its 7th annual State of the State of Manufacturing on May 5 in Trenton — our annual get-together to discuss how the state can help the sector — more than 400 manufacturing, engineering, transportation and logistics firms talked shop with 29 legislators.

Like many others, I left the day feeling as if it was a missed opportunity.

John Kennedy. (File photo)

It wasn’t just because only 11 legislators spent significant time listening to the town-hall style conversations that focused on the biggest issues facing this critical industry in our state. While that number needs to be higher, there also needs to be higher participation among the sector and the business community at large.

There are problems that need to be addressed.

In the 35-plus years of my career, I have seen the manufacturing sector in the U.S. reduced to three words: Made in China.

Now, the actual reality is a great deal different than that, but this mantra has damaged the industry more than one could have imagined. The pipeline for talent and investment (outside of what is considered high-tech) has dried up completely. We were led to believe that a service economy was sustainable; even though history has taught us that only through positive Industrialization is real financial growth realized.

Despite this, there are approximately 300,000 manufacturers in the country, including more than 10,000 in New Jersey. Yet, we have created a vacuum around them and dismissed their capabilities and their importance to our lives.

Need proof: Take a look around you now — and let me know what you see that wasn’t manufactured by someone. I’ll wait …


Where do we go from here?

There was a great deal of discussion at the event about re-shoring, Made in the USA — even Made in New Jersey.

All are great topics that need exploration, but they also require action to be effective. We certainly have had no issue with investing incredible amounts of money into various sectors, but we stop short of making it happen in manufacturing. Corporate welfare? Hardly. If you divide the $158 million spent on the entire MEP National Network, it comes to about $527 per company. I can guarantee you that no one will be retiring early.

That being said, I do believe that our state has moved the bar considerably the last few years, but we still fall short investing and trusting in what our manufacturers can provide. I remain excited about the offshore wind projects, but worry that this will mean little for our firms.

One of the arguments I have heard is that Garden State firms cannot handle the high-tech manufacturing that is required. This is confusing — if not downright incorrect — considering we have 1,700 firms that do extensive Department of Defense work, and another 3,100 involved in the life sciences and medical device markets.


Where am I going with this?

What bothers me most right now is that I am not sure why we all don’t “get it.”

We all want someone to blame in our country today — it makes picking sides easier. However, it does not accomplish much at all. If we take a hard look at the manufacturing industry in our state and country and what brought us to this point, this choosing-a-side mentality has hurt us all and certainly played a part in the lack of growth.

Don’t get me wrong. We all carry some guilt. But, I have to admit, I was disappointed the event did not draw more from government — and from our own industry. It concerns me that both groups do not spend enough time together to learn from each other. After all, this is a sector that still has a huge output in the state.

The manufacturing/life sciences/transportation and logistics sectors in New Jersey contributed the following in 2022:

  • $156 billion: annual GDP;
  • 415,000: direct employees;
  • $40 billion: average annual salaries.

I get it. Everyone is busy. But, if we cannot take a half-day to discuss this critical sector, then do we really expect that New Jersey will become more business-friendly?

The bigger question: Can we afford to lose any of what is already produced here?

It’s time to start talking.

John Kennedy is the CEO of the New Jersey Manufacturing Extension Program (and the former owner of two manufacturing companies).