U.S. to retake manufacturing lead in competitiveness by 2020: study

Deloitte Global research finds America leading in advanced technology.

05/06/2016


The 2016 Global Manufacturing Competitiveness Index shows that the U.S. has closed the gap on China in 2016 and will establish itself as the top manufacturing economy by 2020. Graphic: Courtesy Deloitte GlobalA new study published by Deloitte Global indicates the U.S. manufacturing renaissance over the last decade may be on the verge of reaching fruition.

The 2016 Global Manufacturing Competitiveness Index, published every three years by Deloitte Global and the Council on Competitiveness, shows the U.S. rising to the No. 2 position in 2016 behind China, and it is poised to take over the top spot by 2020. The study, issued every three years since 2010, is the result of interviews with more than 500 chief executive officers and senior leaders at global manufacturing companies.

"The U.S. is currently among the top nations unlocking advanced manufacturing technologies including smart, connected products and factories, predictive analytics and advanced materials that are core to future competitiveness," said Craig Griffi, vice chairman, Deloitte LLP and Deloitte U.S. Automotive Sector leader.

"The U.S. excels at creating connections and synergy between people, technology, capital and organizations to form a cohesive ecosystem of innovation, generating tremendous value from investments in research and development."

While Deloitte Global's study points to significant growth in U.S. manufacturing and belies statements throughout the political season that U.S. manufacturing is in decline, that doesn't mean there are not significant challenges ahead, according to the study's respondents. "While the U.S. lead is a positive signal, the existing engineering and manufacturing workforce that pushed the country forward is beginning to get older," said Michelle Drew Rodriguez, manufacturing leader for Deloitte U.S.'s Center for Industry Insights. "Therefore, it is important that public and private sectors collaborate on the nation's educational and technological future to remain a top manufacturing competitor."

The top 15

In the 2016 rankings, China and the United States are followed by Germany, Japan, South Korea, the United Kingdom, Taiwan, Mexico, Canada, and Singapore. Besides the U.S.'s projected move to the top ranking by 2020, the two big movers projected for 2020 are India, rising six spaces to No. 5, and Mexico, which is projected to rise to No. 7. (See chart for the 2016 rankings). The U.S. competitiveness rank rose from No. 4 in 2010 to No. 2 in 2016, and is projected to take a substantial lead over China by 2020.

The report's authors cited two specific areas of improvement in U.S. manufacturing:

  • As the U.S. invests heavily in talent and technology, the nation ranks highest as an advanced manufacturing economy. The country is highly competitive in terms of the share of high skill and technology contribution to exports and labor productivity, as measured by gross domestic product.
  • The U.S. continues to position itself among the global leaders in research and development (R&D) activities by investing in top universities, R&D talent and venture capital.

The strength of manufacturing is centered in North America and Asia, the report finds, and the growing strength of Southeast Asia is coming at the expense of the BRIC countries (Brazil, Russia, India, and China). "Brazil's political uncertainty, Russia's geopolitical activities and impact from the slide in global crude-oil prices, matched with India's challenged economic and policy actions around infrastructure and investments, have likely triggered the decline from BRIC's manufacturing competitiveness peak," Deloitte Global said in a press release announcing the study's release.

Another area of global manufacturing growth is what the Deloitte Global study called MITI-V (Malaysia, India, Thailand, Indonesia, and Vietnam). All of those countries are expected to grow their manufacturing presence significantly in the next four years, and all five will be in the top 15 in the world in manufacturing competitiveness in 2020, according to the study. While Europe only is represented by Germany and the U.K. among the top 15 countries by 2020, it does hold seven of the next 10 slots. South Africa is the highest-ranked African manufacturing country, taking 27th place in 2016, and it is expected to move to the 25th spot by 2020.

The full study can be viewed here.



Top Plant
The Top Plant program honors outstanding manufacturing facilities in North America.
Product of the Year
The Product of the Year program recognizes products newly released in the manufacturing industries.
System Integrator of the Year
Each year, a panel of Control Engineering and Plant Engineering editors and industry expert judges select the System Integrator of the Year Award winners in three categories.
June 2018
2018 Lubrication Guide, Motor and maintenance management, Control system migration
May 2018
Electrical standards, robots and Lean manufacturing, and how an aluminum packaging plant is helping community growth.
April 2018
2017 Product of the Year winners, retrofitting a press, IMTS and Hannover Messe preview, natural refrigerants, testing steam traps
June 2018
Machine learning, produced water benefits, programming cavity pumps
April 2018
ROVs, rigs, and the real time; wellsite valve manifolds; AI on a chip; analytics use for pipelines
February 2018
Focus on power systems, process safety, electrical and power systems, edge computing in the oil & gas industry
Spring 2018
Burners for heat-treating furnaces, CHP, dryers, gas humidification, and more
April 2018
Implementing a DCS, stepper motors, intelligent motion control, remote monitoring of irrigation systems
February 2018
Setting internal automation standards

Annual Salary Survey

After two years of economic concerns, manufacturing leaders once again have homed in on the single biggest issue facing their operations:

It's the workers—or more specifically, the lack of workers.

The 2017 Plant Engineering Salary Survey looks at not just what plant managers make, but what they think. As they look across their plants today, plant managers say they don’t have the operational depth to take on the new technologies and new challenges of global manufacturing.

Read more: 2017 Salary Survey

The Maintenance and Reliability Coach's blog
Maintenance and reliability tips and best practices from the maintenance and reliability coaches at Allied Reliability Group.
One Voice for Manufacturing
The One Voice for Manufacturing blog reports on federal public policy issues impacting the manufacturing sector. One Voice is a joint effort by the National Tooling and Machining...
The Maintenance and Reliability Professionals Blog
The Society for Maintenance and Reliability Professionals an organization devoted...
Machine Safety
Join this ongoing discussion of machine guarding topics, including solutions assessments, regulatory compliance, gap analysis...
Research Analyst Blog
IMS Research, recently acquired by IHS Inc., is a leading independent supplier of market research and consultancy to the global electronics industry.
Marshall on Maintenance
Maintenance is not optional in manufacturing. It’s a profit center, driving productivity and uptime while reducing overall repair costs.
Lachance on CMMS
The Lachance on CMMS blog is about current maintenance topics. Blogger Paul Lachance is president and chief technology officer for Smartware Group.
Electrical Safety Update
This digital report explains how plant engineers need to take greater care when it comes to electrical safety incidents on the plant floor.
Maintenance & Safety
The maintenance journey has been a long, slow trek for most manufacturers and has gone from preventive maintenance to predictive maintenance.
IIoT: Machines, Equipment, & Asset Management
Articles in this digital report highlight technologies that enable Industrial Internet of Things, IIoT-related products and strategies.
Randy Steele
Maintenance Manager; California Oils Corp.
Matthew J. Woo, PE, RCDD, LEED AP BD+C
Associate, Electrical Engineering; Wood Harbinger
Randy Oliver
Control Systems Engineer; Robert Bosch Corp.
Data Centers: Impacts of Climate and Cooling Technology
This course focuses on climate analysis, appropriateness of cooling system selection, and combining cooling systems.
Safety First: Arc Flash 101
This course will help identify and reveal electrical hazards and identify the solutions to implementing and maintaining a safe work environment.
Critical Power: Hospital Electrical Systems
This course explains how maintaining power and communication systems through emergency power-generation systems is critical.
click me