Business of Engineering

Global trends impact manufacturing in 2022

Manufacturing has gone through many seismic changes and more are on the horizon.

By Kevin Parker December 24, 2021
Courtesy: CFE Media and Technology

In a 2020 McKinsey survey of supply chain leaders about three-fourths of respondents said they planned to increase supply-chain resilience through physical changes to their supply-chain footprints. This year 92% of respondents said they had done so.

But not always as they’d hoped. In practice companies increased inventories but were less likely to diversify their supply bases or to implement near-shoring or regionalization strategies.

In 2020 38% said they planned to regionalize their supply chain but only 25% said they’ve done so in the last 12 months. Chemicals and commodity providers made the smallest overall changes to their supply chain footprints in the last year.

Almost 90% of respondents said they plan to pursue some version of regionalization in the next three years.

Cloud and edge

In a recent interview by CRN with Amazon Web Services (AWS) CEO Adam Salipsky, the executive said that cloud computing adoption was really just moving into the mainstream and addressing industry-specific and case-specific needs.

AWS, the longtime cloud market leader is ramping up investment with its reported 100,000-plus ecosystem partners. Some vertical markets Salipsky sees AWS diving deeper into include consumer goods and financial services.

Houston-based Integration Objects announced an OEM partnership with Siemens Digital Industries Software to deploy Integration Objects OPC UA Proxy as an add-on to Siemens’ MES Line Monitoring System (LMS) of products OPC Classic.

The OPC UA Proxy is a plug and play software that can be used as add-on option to any existing OPC Classic installation whether at a server or client level. This extends Siemens’ offering for their MES Line Monitoring System (LMS) of products as they will be able integrate with any OPC UA installation at their customer sites, seamlessly and at a minimum cost.

According to The Robot Report, statistics released by the Association for Advancing Automation (A3) show robotics sales increased 37% in 2021 compared to the same period in 2020.

In Q3, North American companies ordered 9,928 robots valued at $513 million, up 32% and 35% respectively over the 3rd quarter in 2020. Nearly two-thirds of orders in Q3 came from non-automotive industries.

Inflation and labor

The Bureau of Labor Statistics of the U.S. Department of Labor recently released statistics on the October 2021 employment situation.

Employment in manufacturing increased by 60,000 in October, led by gains in motor vehicles and parts (+28,000). Employment also rose in fabricated metal parts (+6,000), chemicals (+6,000), and printed and related support activities. Manufacturing employment is down by 270,000 since February 2020.

Inflation is running at its fastest pace in 31 years, with a 6.2% increase in prices from October a year ago, according to a New York Times article, “Made in the U.S.A., but with a supply chain reboot.”

The article goes on to suggest that small manufacturers are leading the way in regionalizing their supply chains, as they do not have the options available that the largest U.S. retailers have at their disposal. However, that means higher costs, which can prove difficult to pass on to customers.


Kevin Parker
Author Bio: Senior contributing editor, CFE Media