Sweatman: Let manufacturers adapt without policy changes

Roy Sweatman, President of Southern Manufacturing Technologies in Tampa, FL and a member and former Chairman of the National Tooling and Machining Association (NTMA), joins 24 other U.S. manufacturing leaders as new members of the Manufacturing Council.

By Plant Engineering May 1, 2012

The Council provides advice to U.S. Commerce Secretary John Bryson on issues related to manufacturing sector competitiveness, as well as government policies and programs that affect the industry. Sweatman also is vice-chairman of the National Institute for Metalworking Skills, an organization founded by metalworking trade associations to develop and maintain a globally competitive workforce. He discussed his appointment and the manufacturing issues that need to be communicated to the Administration with Plant Engineering: 

Plant Engineering: There are two issues that seem to be running neck-and-neck among manufacturers: the need for more skilled workers and the need for tax reform. Which one in your view is more crucial, and how do we address it effectively? 

Sweatman: It’s simply not possible to prioritize one of these issues over another since both are essential to the long-term future of manufacturing in America.

On the issue of skilled workers, manufacturing has been tainted by an outdated perception of dark and dangerous plants of yesteryear; today’s facilities are efficient, high-tech environments where we make sophisticated products ranging from satellite parts to cutting edge medical devices. We need to do a better job of marketing manufacturing and attracting workers to our industry in order to have a viable employee base in years to come – and we’re working on it now.

For example, my company, Southern Manufacturing Technologies, gives tours to high school and even middle school groups, works with various groups advocating STEM education, supports robotics competitions such as the National Tooling and Machining Association’s National Robotics League championships in Indianapolis in early May, and other similar ongoing initiatives.

Manufacturing is a very viable career path for today’s young people, and there’s no reason that should remain the best kept secret in the U.S. economy for much longer. But it’s our industry’s responsibilities to start changing misperceptions about manufacturing.

As far as tax reform goes, the far-reaching effects of the policy decisions we’re starting to discuss today cannot be overstated. They say there is no greater determinant to a firm’s behavior than tax policy, and that’s something that policymakers need to keep in mind over the coming months.

Unfortunately, some who claim they want to tax the “rich” need to be reminded that many of these are small business owners who report a certain income due to the way they file taxes but reinvest most of their profits back into the plant, equipment, and employees. They are not the Bill Gates or Gordon Geckos of the world – they are ordinary citizens and entrepreneurs in towns across the country who pay their taxes and reinvest their profits back into their companies.

As a group these companies are some of this country’s greatest job creators. Increases in tax rates affecting business owners and other small manufacturers will stop growth. Policymakers need to understand who they’re really affecting when they talk about tax reform. 

PE: How do the efforts at NTMA align with those of the Manufacturing Council? What specific issues at NTMA do you think the Manufacturing Council needs to hear more about?

Sweatman: Policymakers and business leaders should be working together to ensure that small businesses are able to continue to hire the workers and invest in the new technologies that allow us to stay competitive with businesses overseas. It’s in the interest of our country to do so, and I’m glad that the work of the Manufacturing Council recognizes this fact. After all, small and medium businesses like ours are the job creators of this country and the backbone of our communities.

The Manufacturing Council has four subcommittees: Competitiveness, Workforce Development, Export/Import Issues and Energy, all of which affect our industry and our aligned with the work of NTMA’s priorities. I am assigned to the Workforce Development subcommittee, since it gets right to the heart of one of our top priorities today, as I discussed above.

More generally, manufacturing competitiveness is an issue that reflects our industry’s concerns across the board. The fundamental question we need to ask is: how do we ensure that U.S. manufacturers are not placed at a disadvantage by our own government against our foreign competitors? We need to ensure our government doesn’t make our companies uncompetitive by saddling them with new taxes and higher healthcare, energy and other costs. 

PE: What does manufacturing need to do that doesn’t involve government assistance or guidance? What do manufacturers need to do for themselves?

Sweatman: The many initiatives that I have outlined in the other questions are all private-sector led initiatives that are being undertaken by NTMA or by my company without any government assistance. We are not asking for a government handout. In fact, our efforts as an industry over the past several years have been to try and convince government not to enact policies that hurt our ability to compete.

Manufacturers – particularly small and medium-sized shops like the members of NTMA – have had to stay nimble and adapt over the years in order to thrive in a competitive industry. I strongly believe that we as an industry need to keep on adapting as we look to the future, and make sure to embrace technology, automation and training that makes us better equipped to deal with the market conditions and other challenges that we’ll face tomorrow.

I would also add that manufacturers as a group need to be proud of what we contribute to this country, and we need to remind people about our role creating jobs, making products and contributing to our communities. 

PE: On a personal level, talk about the appointment and your reaction to it.

Sweatman: I am honored to join the Council. I am looking forward to making a difference – to helping strengthen manufacturing in the U.S.

I am proud to represent the metalworking industry and all manufacturers, and I will certainly be a strong advocate for small and medium sized manufacturers, including metalworking companies. These thousands of small businesses are the job creators leading this country back to economic health and prosperity.