Insourcing American Jobs Forum

Hi, folks, thanks
for coming in today. Welcome to the Insourcing
American Jobs Forum here at the White House. We really appreciate everybody’s
patience as we reconvene here from the opening remarks
provided by the President over in the East Room. We’ve got a great lineup,
we’ve got two panels today full of both business leaders
and elected officials talking about their experiences
doing exactly that, insourcing American jobs,
bringing jobs back to this country, and increasing their
investments here in the U.S. and how to try to make
sure we set the conditions, appropriate conditions in order
to be able to encourage that across the board as well. So we’re going to kick off with
a quick start by having some opening remarks from the
Director of the National Economic Council,
Mr. Gene Sperling. Gene. (applause) Gene Sperling:
Thank you so much
for being here. There’s no question, coming back
from the worst recession since the Great Depression
is tough sledding. No doubt about it. And there’s no doubt that
even with the more positive job growth and unemployment
news we’ve gotten lately, we still have a long way
to go and we’re not close to satisfied. This President’s not
close to satisfied. But it is important to note that
we have seen in manufacturing 334,000 jobs created
over the last two years. That’s the best two-year
performance since the late 1990s, and again,
it’s not enough, but it’s an important trend
moving in the right direction. What was so positive about the
roundtable with the President and what you’ll hear a
bit today is, though, not only do — beyond the trends
on job growth, for unemployment, for manufacturing job growth
in the next six to 12 months, the analysis from the experts
and the decisions made by the business leaders here makes very
clear that there is a very sound and strong economic basis for
a new optimism on manufacturing jobs, a new optimism in
bringing back both service and manufacturing jobs, and
a new optimism in America’s ability to compete globally for
the best jobs in services and manufacturing around the world. And I think that you’re
going to hear from people, we have great experts,
Hal Sirkin from the Boston Consulting Group, James
Manyika from McKinsey, Harry Moser from the
Reshoring Institute. As you’ll hear, I think that if
there were two things that came through very loud and clear
in the President’s roundtable, it was, one, awareness matters. And I think that a lot of the
message you’re hearing here — and whether they talk about it
in terms of the total cost of enterprise or total cost of
ownership — is that the experts here are saying that when
companies look at the full costs of their location
decisions, number one, and two, when they look
at the long-term trends, that the economic case for
bringing jobs back to the United States or the economic case for
choosing the United States for your next expansion is
growing stronger and stronger. And as Hal will talk about, it
is very clear that productivity in the United States has
continued to strengthen — 13% since 2009 — and that
while there is productivity growth in China, it is not
keeping pace with their wages. And so that each and
every year going forward, the economic competitiveness
case for creating jobs and locating in the U.S.
becomes stronger. And that for those making a
long-term decision about what’s best over the next
five or ten years, the case again becomes
stronger and stronger. And I’ll let them
go through that. I would also imagine, and it’s
maybe something we can discuss, is whether the recent experience
with the tsunami and the global supply chain has also made
people rethink degree, having some of the more security
when you’re selling to the U.S. market of having more
sourcing closer to home. So there are a lot of trends
moving in that direction. And we heard the
story with Ford, the tremendous
commitment to invest, the partnership with Bob King,
and the story of not job — auto jobs going to Mexico, but auto
jobs in Mexico or factories in Mexico, companies choosing
to expand in my home state, Michigan, and in other
states, is a refreshing, refreshing reality that we are
hearing about and seeing and is making a difference
in our economy right now. Leo Gerard, who is here, talked
about very confidently the ability on steel to out-compete
in China, given the chance. And obviously, ensuring that we
have a fair trade relationship with China, a level
playing field, is a critical part of this
strategy for manufacturing, for exporting, for regaining
our competitiveness. And we heard from people like,
you know, Novo 1 and others, and the person who
introduced the President. Again, being from Michigan, I
have to love the outsource to Detroit, but the National
Economic Advisor. So outsource to anywhere in the
United States is also very good. But that this is about service,
this can be about call center jobs, this can be about the most
high-value-added manufacturing jobs as well. So that was the awareness side
and getting more companies to go through the calculation that
the companies there did. And I encourage you
all to talk to them, because hearing the calculations
they made is extremely powerful and just validates what
the experts are saying in their reports. And the second thing we heard
was that policy matters. And I think for the President,
it was very reaffirming of the policy direction he has taken
and the policy direction we’re going to take with more
force going forward. We heard from, you know, Intel
talked about the importance of the R&E tax credit,
the importance of making it permanent. We’ve called for expanding
it last September, we’re going to continue
that call and that proposal going forward. The importance of the
manufacturing exclusion and making your
location choices. The importance of the expensing. And you heard the President say
this and I’ll just reinforce it: President Obama has given
very clear instructions to his economic team that when we are
thinking about proposals for our current budget, but also the
principles that will guide our efforts at corporate tax reform,
that the incentives to create jobs in the United States and
particularly manufacturing jobs in the United States should be a
guiding principle in our current tax proposals and in our
long-term corporate tax reform. And stress, too, that we have to
be very careful that we are not ever asking the American
taxpayer to subsidize activity moving overseas that is not
necessary or that while, of course, decisions that might
be legitimate should not bear the subsidization of
typical American taxpayers. Of course, everyone understands
this is a global economy. These are global companies
competing for global markets. They are, of course, going to
hire and create jobs in other countries to serve
those markets. The President is realistic,
his economic team is realistic about that. But when the President asked at
the end that at every step you should ask yourself could your
next expansion be in the United States, could you make your
next expansion something that supports the country
that supported you, can you go the extra mile for
the country that’s gone the extra mile for you, that
when he makes that ask, he is asking them to make a
decision that is — which has increasing economic logic and
increasing economic momentum behind that. So with that, I’m very happy
that everyone here and people at home watching have the ability
to hear firsthand and listen firsthand to what the comments
and the conversation the President of the United States
and Vice President Biden had earlier today, and with that I
will turn it over to our panel. Thank you very much. (applause) And actually, I’ll just
say I’ll turn it over to our Secretary of Commerce. And when I was saying
policy mattered, one of the things that could not
have been more important today was the President
announced Select U.S.A. I’ll now let the
Secretary of Commerce, who’s going to lead that
effort, talk about it. But even with the
initial effort, two different companies in the
room specifically mentioned that the Select U.S.A. effort, and
that effort of the United States Government competing and working
to make it easier for people to locate here was essential
in their decisions, and that is before the very
significant expansion that the President is announcing and
putting his trust in his new and excellent Secretary of
Commerce Bryson to lead. So with that, I turn it
over to the Secretary. Secretary Bryson:
So thank you very much, Gene. (applause) And we owe it to you
to be succinct here, and we’re going to try to do the
things we planned to do over a slightly longer period of time,
a meaningfully longer period of time, but I think this morning’s
session was so strong and so many of you here in the room
as well as the panel had the opportunity to describe
your business experience, the labor unions who
participated described their experience in working
with the businesses, so I’m going to be quite
succinct about that. The heart of what we’re
saying, as you know, is we’re reaching out
around the world globally, globally to businesses around
the world to say that the U.S. is open for business. I had the great opportunity to
do that yesterday at the Detroit automobile show. A number of you in
this room were there, we saw each other there. You know, that’s an
example, by the way, not just of prospective, but
what this Administration has done, focused on enhancing
businesses here in the U.S., and then those businesses
responding and creating the U.S. companies’ great
automobile companies, but just business initiatives. And then those from overseas,
the automobile companies from overseas with whom I met
yesterday, they’re responding, of course, with
terrific products, investing heavily in
the United States. So it’s all things
coming together. Gene Sperling talked a
little about Select U.S.A. About five or six months ago
the President directed us in the Commerce Department
to develop Select U.S.A. This really is a key thing. So lots of businesses, and I’ve
talked with lots of businesses, I’ve talked with many
of you in the room. One of the frustrations that
businesses have felt is working really as cleanly as possible,
as efficiently as possible, across not just one part of
the U.S. federal structure, but across all of them. So local levels, cities,
counties, states. And what we’re doing in
Select U.S.A. is seeking to bring together the
information about working with all these levels of
government, make it as readily available as possible. The largest of you companies who
have done lots of this may find that not as directly helpful
as smaller companies, but in the manufacturing chain
the smaller companies are the suppliers in the supply chain,
and they only get better, and advanced manufacturing
is the way things are going. And what we want to do is just
make this as clean as possible. So we’ll talk to you a
lot about Select U.S.A. It’s a Commerce
Department-based initiative, and that’s something I’m
devoting a lot of time with a terrific team to. I can go over some other things
and I’m not going to do very much, but I want you to know
that one of the things we’re doing right now is
training our commercial, our foreign commercial
service officers. So the Commerce Department’s the
counterpart to the State Department. The State Department
people have done diplomacy. The Commerce Department,
as the name suggests, has done commerce. And so we have these people
all around the world, based all around the world, but
what they’ve not been trained to do in the past is to reach out
to people like all of you here to ask that you invest in the
United States and to say we’ll do a lot, we’ll do everything
we can and we’ll listen to you first, but to facilitate
your making investments here in the United States. So that’s going to
be a constant theme. So we’ve had the lead
responsibility in the Commerce Department, for example,
on growing exports. So we have this five-year
target the President set, doubling the exports
of the United States. We’re two years down the
road, that’s going well. There are always
challenges there, but now the focus in addition
is direct investments in the United States. Let me stop there.
I could cover more. The heart of what I expressed
but what we’re doing is we want to help businesses build it
here and sell it everywhere. And as you’ll hear, for example,
from Siemens and many others, that certainly includes the
companies whose principal home has been outside the United
States, but they invest here. I heard a lot at the Detroit
auto show, they invest here, that means they build,
yes, U.S. automobiles, yes, U.S. supply chain, but many
of them export in addition from the U.S. out. So all these things go together. So on the panel we
have Eric Spiegel. You heard from him too briefly
this morning and I asked him to say something more. Brian Krzanich of Intel,
an incredible U.S. company, you know that. So I’m going to ask him
to say a little more. Kasim Reed, the City of
Atlanta, the Mayor of Atlanta, home to 14 Fortune
500 companies, which has been particularly
strong also in attracting investments into Atlanta and
that area from around the world. And finally Hal Sirkin, again,
who kicked off the panels this morning, had a little
more time this morning, but the work that Boston
Consulting Group has done to make all of us think
harder about this has been very helpful. So Eric, if I could
ask you to kick off, and I said to you what I’d
like you to do, please, is to expand on what you said. And I want to put at least as
part of what you address is are there things in your experience
that we could be doing better, significantly better across
the United States in making it possible for you, speedily, to
make the investments you’d like to make here. And are there some obstacles,
some things that seem to you frustrating, costly, and so on,
that we ought to know about and see if we can help with. Eric Spiegel:
Great. Well, thank
you, Secretary Bryson. Good afternoon, everyone. My name’s Eric Spiegel, I’m the
CEO for Siemens here in the U.S. Just a brief background: We’re
one of the world’s largest engineering and
technology companies. We operate in 190 countries,
well over $100 billion in sales. The U.S. is our largest
market with sales in excess of about $25 billion. We have about 65,000
employees here, and over 130
manufacturing facilities. I think if you go back in
time, Siemens has always, Siemens has been in the U.S.
for over a hundred years, and Siemens, we’ve always
manufactured and done business here in the U.S., but we also
used to import a lot of our products from Europe,
primarily from Germany, but also from other countries. That’s kind of changed itself
in the last couple of years. I’ll just give you a couple of
examples and then talk about some of the opportunities and
issues that we’ve encountered. Just last November we opened a
gas turbine plant in Charlotte that’s the largest gas turbine
plant in North America. We invested several
hundred million dollars, created about a thousand
new jobs in Charlotte. And the reason for Charlotte, A,
was we got a tremendous amount of help from the State
of North Carolina, and also from various federal
agencies in making that happen. The Ex-Im Bank was very
instrumental because one of the reasons for putting a
plant here was based on being able to export out of here. I think one of the announcements
that you may have seen today is that they announced that we’ve
just signed a deal to sell, export ten gas turbines, large
gas turbines to Saudi Arabia, which, of course, we never would
have been able to do in the past without the help of
the Ex-Im Bank here. And we didn’t have
manufacturing, we just opened that
plant in November, but we’ve also had sales to
other countries around the world since we’ve opened that plant. So that’s been a tremendous
opportunity for us. I think one of the things to
think about that we think a lot about when we make
investments is the demand. Is there going to be
demand for the products? Because while having an
export business is very, very important to us,
we also need to have, we want to be close
to our customers. We want to see that there’s
demand for the products here. We want to make sure
that we can do R&D, we always like to co-locate
our R&D and our manufacturing because we find that that drives
innovation much more quickly. We want to make sure there’s
skilled and productive labor, and the U.S. certainly
has some of that. And we want to make sure that
there’s an infrastructure. I mean, I’ll give
you an example. In the Charlotte plant, one of
the issues we ran into was that there was a retired rail spur
near the plant that would take the product on to ultimately
be exported out of Virginia. That rail spur had
to be rehabilitated. People often talk about the
infrastructure in the U.S., and I think probably 20, 30
years ago we had the most modern infrastructure in the world. But frankly, I think the
American Society of Civil Engineers recently gave the U.S.
a D on infrastructure, and we’ve run into it in a lot
of our big investments. That one’s an example where
we and the State had to go and rehabilitate a rail spur. Otherwise we would
not be able to export, and therefore would not
have built the plant there. We also built in the last two
or three years two large wind plants, one in Iowa
and one in Kansas. The one in Iowa makes
blades; the one in Kansas makes the nacelles. Those both employ close
to a thousand people. We invested a couple hundred
million dollars in those plants. Again, what’s the reason for
building those plants here? Strong demand for renewables. Twenty-nine states have
renewable energy standards. There’s been an investment tax
credit in place that’s made it a good investment for developers. But again, in both those
plants, different circumstances, we had to build a rail spur near
the blade plant so we didn’t have to truck those blades,
the blades are 160 feet long and they require two rail cars. We had to build a rail spur to
be able to take it to get it out to market to move it. In the plant in Kansas we
had to build new on ramps, ingress and egress on the
highway to be able to move these huge nacelles, which are
almost as large as this room, by truck out to
market and things. So when we look at
these investments, one of the first things you look
at is I think as was mentioned early on, is overall
is this a competitive, are we competitive in
the U.S. making this. And I think the story I told
this morning is I think for the first time making gas turbines
in the U.S., the new plant we have in Charlotte is as cost
competitive with making gas turbines as anywhere
in the world. And that wasn’t
true a decade ago. But we also look at a bunch
of other issues, you know, one being infrastructure. Can we move the products out
of market and can we move them around the country
to be competitive. And I think that’s an area,
one area where I think the U.S. needs to make some
significant investments. The second thing is
around skilled labor. We talk a lot about
skilled labor in the U.S. and a very
productive workforce, and I think those
numbers are true. But one of the
things we’ve found, particularly in Charlotte
and other locations, is there’s a skills gap. We had to spend quite a bit of
time and effort to train people to be able to do the kind of
high-tech work that you see in this gas turbine plant. Very automated process. I think a lot of stories today
have a lot of companies saying that similar plants
built today versus ten, 15 years ago require
a lot fewer people, but those people have to
have much higher skills. So we’ve done something
we’ve done in Germany for quite a long time. In Germany we have about
10,000 apprentices. Ten thousand apprentices
just for Siemens. They go to local technical
schools and community colleges, the equivalent over in Germany. They work half time for Siemens;
they go to school half time. We pay them, and about
80% of those people end up working for us after three or
four years if they’re qualified and they graduate. That kind of a program,
intensive program doesn’t really exist in the U.S. And those are, in Germany
that’s a program that starts with people out of high school. So one of the things we’ve done
around our Charlotte plant, because we need to have people
who can run this plant long term, is we’ve started an
apprentice program with about 15 people, 15 students
out of high school, they’re going to a local —
signed an agreement with a local community college, we’ve helped
them develop a curriculum, and we’re training those people. They’re working part time,
they’re going to school part time, in order to be — we have
a steady stream of people who can be working in that
plant over the long term. This is something that we took
on working with the community college, and I think with
the State of North Carolina. But having more focused efforts. It’s great to talk about STEM. We have the biggest or Siemens
Foundation has the largest STEM high school competition
in the country, and it’s great to talk about
what we need to do in the elementary schools
and high schools, but if you want to bring
technology manufacturing to the U.S. now, you have
to have people who can work in the plants now. And that means we’ve got
to start training people for the jobs of the future. If you want these higher
tech, higher-paying jobs, you’ve got to have the people
who are trained for it. The average job that we’re
putting people into in that Charlotte plant
is $70,000 a year. Okay? These aren’t minimum
wage kind of jobs. These require a lot of
technology and a lot of skills. So again, having very focused
programs like the apprentice program that we have there. We also just signed an agreement
with the University of North Carolina at Charlotte to develop
a gas turbine and technology engineering program
specific to the plant. There are, because we haven’t
been building and making a lot of gas turbines in the U.S.
in the past decade or so, there aren’t a lot of programs
designed to develop engineers for that plant. Again, the plant
requires a pretty steady stream of engineers. So again, that’s a case where
we took it on our own working with a local university, brought
over people from Germany to help develop the curriculum in the
college to make that happen. So again, very specific. Not sort of hoping that someone
out there’s got a program that’s going to give us the right
people for those jobs. And the more you want to bring
over high-tech manufacturing jobs, and also the service jobs
that go with these require the same, similar kinds
of technical skills. We need to make sure
we have people in hand. It can’t be something that we’re
developing people that in five or ten years will have
that kind of capability. I think the third thing that’s
required that I think you talked about earlier today was around
the manufacturing and investment tax credits, especially
on the R&D side. The U.S. is kind of on
again, off again with the — [loud sound] — whoops,
sorry — with the research and engineering tax credit. We need to put that thing in
place long term so that we can make longer term investments
in research with, you know, we’ve got research programs
going on with over 20 universities, we’re doing a lot
of work around cities right now, doing a lot of investment. We do a lot of work with the
federal government on research and development. But we’ve got to make sure those
credits are in place long term so that the programs
aren’t start and stop. You can’t do big-time research
and development on new technologies on a 12
month — 12-month basis. So that’s really important. And I think the program you
talked about, Secretary Bryson, the Select U.S., it
is very difficult. We’re a big company, we
have a lot of resources, so putting together a new
investment for new plants like the ones in Charlotte
and Kansas and Iowa, and we’re also expanding our
light rail train facility out in Sacramento, we have the
resources to go and do that. But for smaller companies, I
can imagine it’s very complex dealing with all the federal
agencies and the state and local governments, making sure you’re
getting all the tax credits and things you can get and all
the incentives you can get, but also making sure that you
can get the plant built on time and on budget and that you can
also do things like have permits and things to export. Very complex and I think that’s
something that having something like Select U.S.A. where they
can really help you take that thing from soup to nuts,
I think will be a big help. Secretary Bryson:
Eric, thank you very much. Brian. Intel is a jewel of the United
States without any doubt. What can we do to help you in
any respect make it such — I mean Intel, not with
notwithstanding costs, notwithstanding obstacles, has
repeatedly expanded right here in the United States. The state of Oregon, a
great beneficiary of that, happens to be my home state,
but what you’ve done widely is a lot. We still, we ought to
be able to improve. We ought to respond
to your presence here, your commitments here, the
extraordinary work you do, are there things we can do to
make it more possible, better, lower cost, you
more competitive? Brian Krzanich:
Yeah, thank you, Secretary. So as you said, we
have a long history. I think we are more of a story,
less of insourcing as versus continuing to source our
manufacturing from America. We have about 80% of our
R&D dollars are spent in the U.S. and about 75% of
our manufacturing is done in the U.S. Although two-thirds of our
product is shipped overseas. So we are a great story of
really made in the U.S.A. And the latest two
projects we announced, we announced last year two
new factories we’re building, one in Portland, Oregon,
and one in Phoenix, Arizona, which will be about eight to ten
billion dollars of additional spending and capital, and
bringing four to five thousand construction jobs during the
construction and, you know, a thousand or more
manufacturing jobs. And as Eric said, these are not
the classic manufacturing jobs maybe our fathers thought about,
these are 70, 80, $100,000 jobs that are good careers. And I always like to think
of myself as an example of manufacturing as a career. I’ve 30 years at Intel,
all of it in manufacturing. I started out as an engineer
on the factory floor and made manufacturing my career. And I’m proud that I run the
manufacturing for Intel now. The typical things that
we run into, as we said, was it’s very important
that manufacturing and R&D, especially in our industry,
be located very close to each other. We run an industry
based on innovation, driven by Moore’s Law, one
of our founders, Gordon, and that really requires a
two-year technology cycle. And you want that research
and development right next to your factory. So the R&D credits are critical. When they are always in question
and you’re wondering whether they’re going to be
there year after year, it’s hard to make the billion
plus dollars per year investment in R&D that Intel does. And so that’s, that’s a very
critical one that we need a long-term commitment
from the U.S. that says we see the connection
between R&D and manufacturing, and we’re committed. That would be very important. We talked about the
manufacturing tax credits. We believe that we should get
credit for bringing those jobs and making those
investments, you know, our capital expenditure for
Intel last year was $10 billion. Most of that, the largest
percentage of that went into manufacturing. So again, we are investing
in those factories. We have to continually invest. The other one, as was mentioned
already, is infrastructure. We often want to go build one of
these very large factories in a city like Chandler, Arizona,
or Ronler Acres, Oregon, and we can sometimes
tax the infrastructure. We have to spend about $200
million in Arizona, for example, on the waste treatment plant. And the City really
can’t afford to do that, to upgrade the waste
treatment plant to handle the extra capacity. And so we’re actually
having to fund it. Having some kind of joint
program where the city and the state could go to the federal
government and we could work together to help fund that
infrastructure would have taken $200 million out of a project
that’s about $2 billion, so 10% of a project’s cost. And then lastly is just the
overall income tax rate. You know, Intel paid about 32%
income last year, income tax, about $4 billion, a
little over $4 billion. So lowering that number could
be beneficial to let us reinvest more into these factories
and expand our capacity even further. So I think those are the real
big key items that would help keep us reinvesting in America. Secretary Bryson:
Brian, thank you very much. There’s a lot of
overlap, in fact, nearly complete overlap with the
priorities that Eric set out. So I’m not exactly running
perfectly on time schedule here. What I want to do just extremely
briefly is ask Kasim to talk about the experience in Atlanta. And if you do this very briefly,
what I’m going do then is — because I want to preserve time,
and we’ll only have on the order of ten minutes. But I want to give those of you
in the audience the opportunity to put the questions you would
like to put — and if I have to push it a little
longer, I would. But Kasim, if you would help me,
you gave a good presentation on Atlanta. The story is a
really strong one. And here is part of what
we’re talking about, bringing the federal government,
the local government, state governments together
in ways that help, and often that maybe
significantly help the smaller businesses. But all the things that have
been described here are relevant to businesses. And we’ve got, competitively,
to strengthen the businesses of the United States. This is a competitive goal in
the world, and we’re not going to succeed — and perhaps most
of you know that we have been, by one description, the last
of the major, major business countries in the world
that hasn’t had a long-term competitive strengthening plan. We’ve been pretty short term. So we have not done all we
ought to do in this area. Kasim? Mayor Reed:
Thank you, Mr. Secretary. I will be brief. I think that my focus today was
really what can cities do and what can the federal government
do to be a friend to business. And I just cited
specific examples. Atlanta is the home to 14
fortune 500 businesses. And what I’ve seen is we can
make sure that we’re responding faster than we ever have before. So that includes what kind
of incentives we provide. But it also includes making sure
that the government responds rapidly when there’s a decision
that needs to be made that will create jobs. And to the extent that that
becomes a part of the federal government’s culture, then
I believe that it will help cities’ competitiveness. And since 80% of our nation’s
GDP occurs in cities, it will help the
nation’s competitiveness. Specifically, when we were
recruiting the headquarters for Porsche North America, which
is certainly foreign direct investment, Porsche had never
built a headquarters for North America before. But we attracted them to the
campus at Hartsfield Jackson Airport in order to close that
deal after putting significant incentives on the table from
the city and from the state. We had to have a great deal of
cooperation from the FAA because of the proximity of the
headquarters to our airport. It’s literally on the campus. We took a closed
automobile plant, and now we’re going to build
$100 million headquarters for an iconic company and attract
250 jobs initially and expand to about 350 jobs. We’re going to have a call
center on that campus. And I think it was a great
example for what happens when government acts expeditiously. I don’t think that the FAA could
have been a better partner in that process. We had one other opportunity
recently where we attracted $300 million in investment into a
one million square foot building that had been
shuttered and closed. Jamestown is a private
equity fund that’s financed by German capital. Because we had cooperation
from the government, we were able to secure national
historic tax credits that helped bring that deal to life. So to the extent that government
responds and acts like it cares about job creation,
I think that’s going to be transformational. But when you have a deal, a
leader of a city or a governor has to be able to engage
the federal government, show that we have a
real deal on the table, lay out the jobs case and,
once you determine it’s valid, act with the kind of speed and
energy that I think is warranted when all of our priorities
is job creation. That’s what I was asking the
President and Vice President for and asking the Commerce
Department for, Mr. Secretary. Secretary Bryson:
Thank you very much. All right. I would like to
solicit now questions, comments from all of
you in the audience. Let me underscore that all
four panel members are good candidates for responses
to questions you have. So yes, I saw you first. Audience Member:
Thank you, Mr. Secretary. I’m Nancy McLernon with the
Organization for International Investment, and we are very
pleased that the administration is holding this event today. I was pleased to hear about
your focus and thoughts for expanding SelectUSA. As you know, the trend of
foreign investment in the United States has been
on a declining trend. And the thought of putting some
real muscle behind a group like SelectUSA is great to hear. I would like to know what maybe
some of the panelists might think of an idea — as well as
yourself — about an idea that The Jobs Council, the
President’s Jobs Council, put foward last October, which
was to establish a national investment initiative similar
to the idea of a national export initiative, but this would focus
on increasing foreign direct investment by a trillion
dollars over the next four or five years. So making it a
national imperative, somewhat like we
did with exports. So I would like to get the
thoughts of those on the panel, if something like
that might be helpful, elevating the desire to increase
for a direct investment in the United States and then if you
could share any thoughts on that yourself, that would be great. Secretary Bryson:
I’ll simply start by saying I
want to turn it to the panel, and then I would be happy
to say something after that. But I do want to commend
The Jobs Council. SelectUSA is an idea that arose
in the Commerce Department. To his great credit, the
President took up the idea, and The Jobs Council. And I think the affect
of The Jobs Council, recognizing the opportunity
here and then underscoring it and saying very
directly in its report, nice idea but you have way too
few resources relative to what’s being done competitively by the
major business countries where there are longer term and deeper
and much more strongly supported plans around the world. So that’s a very big thing. And I’ll see if I
have anything to add. But let me see whether any of
you on the panel have something to say with respect to that. I know none of you on the
panel will want to take up the responsibility precisely of what
the federal government ought to be doing by way of expanding
resources in this area. But I welcome any
comments from any of you. Eric Spiegel:
I’ll just say a few words,
given that we’ve been putting a lot of foreign direct
investment into the U.S. You know, I think one of the
things I heard today at the meeting around the table and
from the President was — and I think your quote at the
beginning, “The U.S. is open for business”, I know
you’ve said through the SelectUSA that one of your top
objectives is encouraging more foreign direct investment. And I think a focused effort
around that would be important. I think about 5% of
the jobs in the U.S. are from foreign
owned companies. But it’s about 15%
of the manufacturing, 14% of the R & D spending. Foreign companies are driving a
lot of the manufacturing growth in this country, and we’ve
been one of those companies doing that. And I think the more
we can let, you know, companies like Seimens and some
of the other companies we had around there today around the
world know that we’re trying to encourage foreign direct
investment in the U.S. and we’re doing what we can to
bring it here because I think for years there was — you know,
there was some thought out there that it wasn’t the most
important thing in the U.S., right, that creating jobs —
not just creating jobs but encouraging foreign companies
to invest here was a priority. And I think what I heard
today is it is a priority. And I think if we make it a
priority and put some muscle behind it, I think you’re
going to see a lot more foreign investment here. This is the biggest
market in the world, and it’s got all the advantages
I talked about before. And when you run the
numbers, I think the U.S. is looking more and more
attractive every day. So we’re very
bullish on the U.S. Secretary Bryson:
Thank you, Eric. Yes? Hal Sirkin:
I think you want to give
foreign direct investment in the U.S. a push. And I think you want to do it
now because we’re starting to get to a point where the
economics continue to change in favor of the U.S. so speeding
up is always a good thing. If you look at our
work or productivity, it’s among the highest in the
world, higher than Germany. If you look at
productivity versus China, we’re 3.4 times as
productive as China, and China is seeing wages
rising in other things. So it’s a very good time for
people to — for companies to think about U.S. as an
investment, whether it’s U.S. companies investing in
the U.S. or foreign companies investing in the U.S. And as we said before, you know,
we are a huge market and we will remain a huge market
for a long, long time. And when you think about
increasing transportation costs and other things,
the U.S. is an incredibly attractive place. What we are doing now, as far as
I can tell inside the government — I’m not part of the
government — we’re starting to recognize the need
to do these kind of things. It was an assumption in the past
that they would just happen. And we see with USASelect and
other kinds of activities the beginnings of pushing forward
on these kinds of topics. And those are things
that China is doing. Those are things that
Germany is doing. And we’re catching up. And I think what we’ll see
is a fair amount of increased investment because even at the
euro at 1.30 to the dollar, the U.S. economy looks
incredibly attractive as a place to manufacture. It’s very hard to export things
from Europe to the U.S., because it’s just that much more
expensive to make in Europe. Secretary Bryson:
Good. Others? Yes? Audience Member:
Secretary, we applaud what
you’re trying to accomplish here in America and make
this a place to grow and build things. I own a steel
factory in Baltimore. And like Intel, we make
everything in the U.S.A out of Baltimore. We export to 35 countries. However, one of the things that
hamstrings us is our tax policy. I compete with Canada,
and they have an 18% rate, and it’s declining. That includes health insurance
for all their employees. Intel pays 32% taxes. I have a higher tax rate than
that because everything goes through me personally. And I have to pay Blue Cross and
Blue Shield for my employees on top of the high 40% rate. So I think something that you
could do to help us — and President Obama can do to help
us — is to make our tax rates competitive so that we can beat
Canada and we can beat Germany and we can beat China. And more jobs will be created
here and then we’ll be able to hire more unemployed
Baltimore city steelworkers. Secretary Bryson:
That’s powerful and absolutely
critically important. I think you likely know that
the President is committed to doing that. Now, a reality is,
right now at this time, in this Congress where it’s been
so hard to get anything passed, may not be the time in
which this gets done. I can tell you candidly, I’ve
been a part of a very large number of planning dialogues
across this federal government on how we can do that, how
to structure and so on. So there’s a lot of
work being done on it. I hope something can be
done as soon as possibly can be achieved. Audience Member:
Gene Sperling talked about
how this is a — incentives for manufacturing should
be a guiding principle. I think he’s right. You should do it. Secretary Bryson:
Yes. Perhaps you know
President also asked me to lead the manufacturing
coordination effort across the federal government, so
it’s a big focus of mine. I’ll do that — Gene will do the White
House policy bit of it. But the practical kind of
reaching out to all of you, I would like to get
your name and follow up in direct conversation. I want to put a big
emphasis on that. Yes? Can you do these in
sort of one minute? I won’t even respond. Audience Member:
My name is Paul Fichter. I have a company called
Taphandles out of Seattle. I have about 600 employees. I just opened two new
factories in the United States, one in Seattle,
one in the Chicago, that will create about 250 jobs. My experience is not in complete
concordance with theirs because they’re these mega billion
dollar companies and I’m just a small company. And so navigating these
programs doesn’t really work for a company like mine. I got no help from Seattle. I was under the radar
for HUD and so forth. And Chicago wasn’t that
interesting either. We just did it on our own. But I would like to
discuss more or echo this, that in growing years, my
tax rate can approach 90% on a cash basis. So there’s other things that
companies like mine could use that might be different
than the Intel and Seimens. And I hope you’re getting
the chance to hear us too. Secretary Bryson:
Good. That’s important. Now, let me say, we’re going
to turn right after this. Karen Mills who is at the back
of the room, has just walked in, is head of the Small
Business Administration under the Obama administration. She has done extraordinary
things in effective leadership, taking this much further than
had ever been done in the past, reaching out to smaller and
medium sized businesses. So that will be very
much on the agenda. Karen can describe some of
the things they’ve been doing. SelectUSA is very much a part of
the future with respect to this. So stay with the next panel,
and I think we can give more attention to that. Yes? Please introduce yourself
and we’ll do one minute. I can do you and one more and
then I’m going to have to stop. Audience Member:
My name is Jasol Penia [phonetic]. I’m the founder of a company
called (inaudible) Networks. It’s the largest manufacturer of
GSM base stations and switching systems for the
telecom industry. My question is actually
to Mr. Eric here. I am an ex-employee of Seimens,
and I’m proud to be one of the examples that you mentioned
about putting students through school. Seimens put me through Florida
Technical University in Boca Raton where you used
to have your telecom infrastructure groups. My question to you is why
did Seimens leave the telecom industry in the U.S.? Seimens left. Lucent integrated with Alcatel. Nortel bankrupt. We have no more companies in the
U.S. that manufacture (inaudible). And what can the federal
government and the President do to get these companies back
in here and expand back on the telecom so we can compete
with (inaudible) and others. Eric Spiegel:
Unfortunately — that
was — by the way, I’m glad to hear your story. I would like to chat
about that later. The exit from the telecom
business took place — I’ve been with Seimens for
a couple of years, and that took place
before my time. But I think, with the
new CEO, Peter Löscher, coming in five years ago, the
emphasis was really on reshaping the portfolio around businesses
that we saw where we could drive global technology and be
competitive and things. So that was a decision
made before that. It’s a good question
about what the U.S. does. I’m not an expert on
the telecom market, so I really don’t have
much to say to that. Secretary Bryson:
All right. The last one — and
my regrets for not being able to reach others, but yes? Audience Member:
Mr. Secretary, my name
is George Schindler, and I work for a global IT
services firm and I run our U.S. operations. We’re very committed to opening
what we call onshore software delivery centers across the U.S. We have three centers today,
a thousand jobs created. Both businesses here talked
today about the importance of having manufacturing tax
credits as part of that. What I would like to see is —
or hear about your plans for potentially broadening those
manufacturing — traditional manufacturing into
other manufacturing like software development. Secretary Bryson:
Any others? With regard to manufacturing,
what the President asked me to take on is not limited,
not narrowly defined in any respect right now. It needs to be flushed out. Now, we’ve launched the facility
at NIST here which is part of the Commerce Department of
the National Institute of Standards and Technology. It integrates, by the way,
the entire federal government. So this, as I said, is a
coordination across the entire federal government. So I can’t give you a very
direct answer right now, but we should be
able to follow up. So thank you very, very much. I appreciate your being
here, your engagement. I would like to
have more questions, but what I want to do —
do we need to do something? Is the idea take a break
or continue straight on? Speaker:
Straight through. Secretary Bryson:
All right. So then Karen Mills whom I
introduced and I don’t see right now but I’m sure will walk
right into the room right now. She’s an extraordinary
leader, incredibly smart, strong business background. And she’s going to make a real
further difference, I think, for many of you, but
particularly the small and medium size businesses. So thank you very much. (applause) Speaker:
All right. If we get the other
panelists for the second panel to come down. I see Harold here. Mary Murcott, Bruce
Cochran and John Heppner, if you guys could all
join us as well. Great. Well, thank you all for your
engagement in the last panel. We were going to just
power right through, decided not to take a break
knowing that we’re going to have a tight timeline here. I want to respect your time. So we’re going to move directly
into the second panel which is titled “Competing at Home:
How Businesses are Making it in the U.S.”. This will be a little more
focused on some of the small business components,
manufacturing, supply chain, a lot of the elements that have
already been discussed today. So I will leave it to our
moderator to introduce the panelists, but I get the
pleasure of introducing her. You’ve heard a
little bit about her. Having the chance to work with
her nearly every day in our business engagement, it’s an
incredible honor to introduce Karen Mills who’s the
administrator of the Small Business Administration. (applause) Karen Mills:
Thanks. And thanks to John for that
introduction and for all of the work that we’re doing together
to focus on manufacturing and now to focus on bringing
that manufacturing back to this country. We have a great panel. And we’re going to ask for some
of your questions and we’re going to take as
many as possible. I do want to just say a couple
words about some of the things we talked about this
morning and the Small Business Administration. One of the things the President
said this morning is that what we want to do with large
companies and small companies is give those folks who are going
to choose to manufacture here, who are going to choose
to provide services here, all the tools they need to be
able to grow their business. And that means access
to financing which, for small businesses,
has been an issue over the past several years. And we at the SBA
provide loan guarantees. We actually had a record year
last year and did more loan guarantees than ever before
in SBA history, $30 billion. So we are all over the country
working with about 5,000 banks. And if you haven’t asked
your banks about an SBA loan guarantee, we’ll talk
about that shortly. Another thing that I want to
make sure that you’re aware of is we just were able to renew
something called the small business innovation
research grants. And it was the first time
in about six years that we got permanent
congressional authority. And it was a bipartisan
bill that passed. So don’t let anybody tell
you that nothing is happening because we were able to get
support for small businesses getting SBIR grants. It’s $2.5 billion. And once again, this is for you
and your small business to do research that will help you
innovate here in this country. So we have an array of things,
including activity in the advanced manufacturing
partnership designed to make sure that entrepreneurs can
continue to innovate here, that large companies can have
supply chains full of some of the best entrepreneurs. Lastly, we’ll talk a little
bit about supply chains. And we heard from
some larger companies. There are opportunities for
small companies in the supply chains of these larger companies
as they bring back production and activity. And we want to make sure that
those connections get made. So we have started the
American supplier initiative. It involves everything
from match making, which we do — We run the
federal government’s small business supply chain which
is about $100 billion, doing state of the art
activity for the Defense Department for instance. Lots and lots of those suppliers
are able to be available and are interested in doing
commercial products as well. So let’s get started
in our panel. You’ve heard some of these
stories mentioned by the President earlier. But I think, Harold,
if it’s all right, we’ll start with
the basics again, being the fact based analyst. Harry Moser:
It’s actually Harry. Karen Mills:
Pardon? Harry Moser:
Harry. It’s wrong on there. Karen Mills:
I’m sorry. Harry Moser:
That’s okay. Karen Mills:
How can you frame this for us? What is happening — and
you said some things earlier to the President. We had just some
of the basic facts, but what are the key metrics
that you can share with us about how the economics have changed? Harry Moser:
I think Hal covered
that somewhat on the previous panel. So the basics of his message and
the one that we also carry is that the costs in China and
other countries but especially China because they’re the 800
pound gorilla in off shoring, that they’re rising rapidly. Their wage rates expressed in
dollars are going up at 20 to 25% a year while U.S. employment
costs are going up at 2% a year — 1% a year. And therefore, even though
they’re starting much lower, when you go up that fast,
every three years you double. And so they’re rapidly
approaching a point where their total cost will get
close enough to the U.S. total cost that when you include
— let’s say their cost of manufacturing will get
close enough to the U.S. cost of manufacturing that, when
you include what we call the total cost of ownership, when
you include the duty and the freight and the packaging and
the inventory cost while the product is in route, the
intellectual property risk, the travel to go see them, all
these extra costs that aren’t the case when you deal with
your supply chain and buy from somebody locally, then when the
companies recognize all those costs, then they are much likely
to make the decision to bring the work back here. So as Hal pointed out, you
know, our cost is here. The Chinese cost
is coming up here. There still is a difference and
there still will be a difference in 2015 which is his
year for convergence, unless the companies recognize
this total cost because that typically is 20 to
30% of the total cost, these hidden costs that many of
the companies don’t recognize. As an example that
I gave this morning, one of the major aerospace
companies that I talk to, I asked them how do they make
their decision about what to make here and what to offshore. And they said well
here’s an example. This sounded like a
thousand pound housing, and we have it made in the U.S.
and then we air freight it to China to be machined and we air
freight it back to be plated. And we air freight it back
to have something else done, and we air freight
it back to the U.S. to be installed into
the aerospace product. They said when we try and
decide whether to do it all here in the U.S. or do this,
we only look at the prices from the suppliers. We do not include
the air freight. We do not include the carrying
cost on the inventory. We do not include any
of the risks involved. And that’s stupid. You know, if you’re not
looking at all your costs, you can’t make right decisions. So what we The
Reshoring Initiative do, we’re a nonprofit organization. We provide a free software so
that the companies can use it to make the right decision and
recognize those extra 20 or 30% of the costs and therefore,
more often and sooner, decide to bring more of the
work back to the United States, either to their own
facilities or to people in the U.S. supply chain. Karen Mills:
So Bruce, you’ve become now the
poster child for an industry which everybody thinks is dead
in this country, furniture. And you saw your own family’s
business move overseas after it was sold. And then, after years of being
in that market, being in Asia, you told me it occurred
to you that, you know, people wanted made in America
furniture and you could come back and do that. And like a great entrepreneur,
he said to his wife, we’re going to go home and make
our own furniture and we’re going to put every
penny we own into it. And she said to him, last
month, yes, we’ve done that. So mission accomplished on that. But he is back in North
Carolina employing people. I think that you had the family
business and in the same factory as the family business. What makes a sector like
furniture now able to be produced back in this country? And how do you see
growing that business? Bruce Cochran:
When we sold our
company back in 1997, we employed almost 1400 people. And over the subsequent years,
all that production was moved overseas and all the capital
investment was dismantled and sold. And I subsequently went to Asia
myself and started sourcing products for furniture
manufacturers in Asia, specifically in China. So I was part of the problem
of dismantling a $50 billion industry, furniture industry. And as the years went by, I
saw the cheap abundant labor in China diminish in 2006. There was serious labor
shortages in China, especially in some of the
labor intensive industries. And everything that’s
symptomatic of labor shortages, which is poor quality,
increased cycle times, delivery times were horrendous. And that was coupled with
changing currency and increase in shipping cost. And then in 2010, I realized
that some of the ancillary cost involved, that my customers were
seeing and they were starting to capture, it really made a lot
of sense to start manufacturing furniture back in the
United States again, especially the kind of furniture
that I was accustomed to making in the years past. And when I got in
this business in 1974, there was literally dozens and
dozens of people that made fine furniture with fine
cabinet joinery, traditional cabinet joinery. And that has all but disappeared
in the United States. Many people don’t really realize
what a fine piece of furniture looks like anymore. So I realize that I could
not only make a — a very competitively priced product,
I could make something that the Chinese were probably
unwilling to make. And I could make the finest
furniture with traditional cabinet joinery, the finest
furniture made in the world. And I could do this with
state of the art technology. And I could do this with
an American worker that is highly productive. How SIRCA had mentioned that the
American worker was 3.4 times more productive than the
— than the Chinese worker. Well, I would contend that when
you get in these higher labor jobs, that — that
differential is much greater. So those were the things
that went through my mind, that — that gave me
pause to say, yes, I can do it here again. And had the opportunity and had
the very good fortune to work with Carolina Trust Bank
in Lincoln, North Carolina. It is a small community bank,
but they agreed to do all of our equipment financing. Which was — which was
very, very helpful. And Carrie had
mentioned the SBA loans. When my banker first — when he
mentioned SBA loans, I said, oh, no, this is — this is just an
onerous amount of paperwork. But he indicated that that
paperwork had been reduced drastically and — (applause) — yeah. It is really — And he is
actually — here is a banker that is actually
touting an SBA loan, because the paperwork
was not too much anymore. And he as a matter of fact, this
particular bank had done quite a few SBA loans in the past. He was able to identify
another loan program that had a 90% guarantee. That was very, very helpful. It wasn’t SBA, but it was —
it was another federal loan guarantee that or actually the
federal government provided the money for the state to
make the guarantees. I think that was the mechanism. But capital continues to
be a very, very difficult, when you raise equity in a
private equity offering like Lincoln and Furniture did,
in that private equity offer. And you seek to sell a
limited number of investors, minimum investment is $50,000,
it is very, very difficult. Especially when you don’t
have anything to show on them. But we did raise some money, but
there continues to be and I had spoken to Karen about it,
there continues to be for small businesses, issues of capital. Especially working capital. I think some of the programs
that are available now, you can get really good
equipment financing and we got all of the equipment
financing that we needed. But then there is
working capital issues. And we are not talking about
money that — that I want somebody to give me. I am talking about money that
would give us a comfort zone, a comfort level and help us
operate in a manner that we wouldn’t have to be always
wringing our hands about the capital issues. And we are not talking
about a lot of money either. We are talking about a quarter
of million dollars to a half a million dollars. And for a lot of businesses,
a lot of small businesses like mine, just to have that
cushion would be a great help. So — Karen Mills:
Well, I thank you very
much for that mention of the SBA particularly. As you know, the President has
all across the administration tasked us with reducing
and simplifying. And I will say that
when I got this job, my husband said to me — you
know SBA, too much paperwork, too much time. Well, now we are down from this
much paperwork to this much paperwork and we have shortened
all of our cycle times as well. So loan turnaround
time is in the days, not even the weeks
and the months. So we are I think recognizing
that particularly in the past few years there is a lot of
small businesses out there with the interest in expanding, but
they don’t necessarily meet all of the criteria because they
have just suffered through a couple of tough years. We will provide now and this
is one of the announcements of today, a 90% loan
guarantee on certain “insourcing” and Dario
Gomez who is there, I am going to have you stand up
because I bet there is somebody in this audience who like
John is — like Bruce is, looking for an extra
piece of capital. And we have a particular working
capital line that we just simplified as well called
the Cap Lines and we have 5,000 banks as I said out
there working with us on exactly this effort. And this is a place where
government can come in and put the wind at the back
of small businesses. Mary? Mary Murcott:
Well — Karen Mills:
Wait a minute. How many of you have made a call
to a call center and it has been picked up and you realize you
are probably talking to somebody in this country. I don’t know. Recently, you have
begun a trend. Mary Murcott:
We have begun a trend. I have been helping as a
consultant and now as a CEO of a out sourcing company that
is completely on shore helping companies come back
to the United States. I am a founding member
of Jobs4America. Jim Kohlenberger is over here. And he has also help started it. And we are dedicated to bringing
a hundred thousand jobs back in the contact center world. It is not working over there. And I think many — you know,
many of us have had a good call over there, but it
is not extensible, it is not repeatable often. And you know, the reason the
call centers went over there 10, 15, 20 years ago,
no longer exists. It was the easy calls we
first sent over there. Password resets. Things like that. Those calls are gone. They ever all been automated. Right. What is left are the
contextually sensitive, the complex problem
solving skills. The ones you need good
communication skills. And if we are having a hard time
understanding them, just think, they are having a hard
time understanding us. So you know, there has been a
myopic focus on next quarter earnings by the CEO. In turn, myopic focus on unit
costs and costs per minute. And they are not looking at
total cost of ownerships. When we — we have a operating
model and we hope companies show them how they can do it
15% cheaper in the United States if they take all of
those costs into account. So the fact that they pay half
of the cost in labor cost, doesn’t make any difference if
it takes three calls to get your problem resolved. Right? I mean, that is
real simple math. In addition, the handle time is
50% to 100% higher over there. So again, costs per minute
goes out by the wayside. That just doesn’t make economic
sense in an operating model. So there are many other things
like if you haven’t solved a customer’s problem, what is the
ability to cross sell or put them in another product? What is the — what is
the focus on your brand? I think people have done a lot
of brand damage by putting their call centers over there. I mean, sometimes you only have
with your credit card company, you talk to them once a year. Don’t you want that four to ten
minute call to be an emotional connection with your customer? I think you do. And so my company is dedicated
to improving the customer brand, to improving the customer
experience and long-term loyalty, because it is really
not about short-term profit. It is about long-term loyalty
and viability of the companies. And so it is not cheaper
to do business over there. Our customers don’t like it. And, in fact, a lot of call
centers have come back. Three percent of all working
Americans are working in call centers right now. Only 12% of call
centers are off shore. Three years ago, 30% of all
high tech call centers were off shore. Now it is 12% I think. So they are coming back. But nobody is talking about it. And here is why. Number one, a lot of people
don’t want to make — talk about the mistake they made. Right. We have some people up here
that you know have — have been completely honest and said,
hey, mistakes have been made. We shouldn’t have
been off shore. So the mistakes have been made. Also, they can’t — they may
have come back but they can’t say so, because another division
hasn’t brought their — so they don’t toot their own horn
because another division still is off shore and it would
confuse the brand if you said we have brought our
— our calls back. And — and that is not the
case with another division of the same company. And lastly, a lot of these
companies come back and see it as a competitive edge. Go ahead and leave
your calls off shore. Leave them off shore. You are hurting yourself. So you know, I think, that a
lot of people are coming back. There is a lot of examples. And you know, my CFO and I
all of the time sit down with companies and show them
the new operating model. And we are happy to do so
even if they can’t come to my out sourcing company. You know, just happy
to bring them back. Karen Mills:
That is great. I come from the
great state of Maine, and you know where there
is sort of iconic LLB customer experience. And they are really you
know as a proven connection, between the customers and
because of those customer service people. Mary Murcott:
Well, the fact is also it is
not a minimum wage job anymore. What is left of those
contextually sensitive, the average call center
worker makes probably 13, 14, $15 an hour. There might be some
down in the 10, 11-dollar an hour wage level. And then they go up to the
hundred thousand for technical support and things
like that, sales jobs. So they are not
minimum wage jobs. In fact, we have in our
center, a number of people, husband and wives
that work there. And their — their family
now is in middle class. They both work in a call
center on the phones and they are middle class. I also have four generations
working our call center. It is great for older people. They have great mature judgment. I have one woman on the
phone that is 92 years old. Ms. Charlene. She recruits for the Army and
she does a heck of a good job about it. Karen Mills:
There you go. Mary Murcott:
So you know, these are
not minimum wage jobs. They are harder complex jobs and
what is required I think and I mentioned this to the President
is we need to get our high school education
graduation rate up. Some of these jobs
require college. All of them require high school
communications skills, written, oral, complex, hard thinking,
critical problem solving. And when I walk into cities and
frequently I walk into major cities that have 50, 60%
graduation rates out of high school, I can’t be there. So I move and I select — I
select a city that has 85, 90% graduation rates. So we are going to have to think
about being competitive within the United States. And we’ll start competing for
those jobs as they come back. Karen Mills:
Well, that leads I think John
into some of the things that you mentioned earlier about
work force training. I will say Master Lock. When you think about it,
who has a Master Lock? John Heppner:
I want to see all
of the hands here. Karen Mills:
You probably know that brand. Yeah, you know that brand. And you are producing in
Milwaukee and one of the things I think the
President talked about, when he introduced
you this morning, he said you are at capacity
now for the first time in a long time. And what you said was, boy,
I need more skilled workers. I have got business, I
can do business here. I can ship it overseas, I need
to make sure I am working with the community colleges and
with others for building the skilled work force. John Heppner:
Absolutely. So I
am John Heppner. Karen Mills:
Tell the story. John Heppner:
I am the CEO of Master Lock. And we make locks. I know that surprises you. About 65 million a year. That is pretty big. That is a lot of locks. I always had the theory that
people threw them in the ocean, that is why we make
so many a year. But our story is a
little different. We are about a
medium sized company. We are part of a New York Stock
Exchange Trade company called Fortune Brands
Home And Security. And I had to go if you take
Master Lock and you go back to the late 90’s, like
another company, as a matter of survival, we
out sourced many of our jobs to China and to Mexico. What happened back then is we
had a facility with about 1200 people in Milwaukee,
Wisconsin that we kept open. We kept about 300 people
I think at the time. And now I can say we are up
to 400 people and growing. Some of the challenges,
I mean, you have heard about the economics. The economics are working in
our favor and we are moving jobs back and we feel
good about that. And when you are a businessman
and you are making those decisions, economics plays a
huge role in the decision to move jobs back. And so we are — we are
seeing that dynamic change, for all of the reasons
that you heard today. And we won’t go back into that. And some of the things that
we talked about today, well, what could make
that happen faster? And so I thought I would
just share with you, some of the challenges that we
have had and we talked about earlier today is just our
access to skilled labor. And that — that is something
that is very important to us. And we talk about skilled labor;
we are talking about machine, build and repair. We are talking
about electricians. We are talking about
electronics people; we are talking about
tool and dye makers. And we are talking about a
higher level of skilled people than we were ten years ago,
because the jobs we are bringing back now are bringing back to
a much more automated facility, a higher tech facility than
we had during the late 1990’s. And so with the challenges
that is put in front of us, how do you go out and recruit
for skilled trades people? Because honestly there is a
couple of things that have gone on with the transition
of manufacturing out of the US, a lot of people have
lost their jobs. And a lot of those people were
skilled trades and they went to find other things to do. Then you have the new generation
up and coming going to high school and they don’t
have shop class anymore. And it is hard to aspire to
something that you never been introduced to. So we have had those
challenges as well. How do you — how do you
get the younger generation, how do you get the students
to want to aspire to go into manufacturing and
to have that job? Because we have a gap, we have
a real gap in this country. I mean, if I look at your
skills trades people, we are — we are approaching 55
plus in terms of an age group. Because we have a gap. And we are going to
have to fill that gap. And if we are going to bring
back jobs faster in this country, we are going to have to
do some pretty intense training. And some of the things that we
have done is we have partnered with many of the local
technical colleges and some of the universities. We have done that in terms
of being on their boards, participating in how the
curriculums are built. Financing that. And then allowing people to
enter those programs to earn an apprentice and
journeyman-ship after about five years of training. So it is a long process. But at the end of the
day, it benefits us. And it benefits them. So we have been on
that road for a while. And so we talked about some
things this morning about how can we get better
training, faster training? And how can we make manufacturing
a business that kids aspire to coming out of school? So that is really critical. Karen Mills:
You know, I was in Minneapolis,
we were announcing a partnership with the National Association
of Manufacturers on The Right Skills now, which is part of
our Skills For America and we are teaching entrepreneurial
skills as well as manufacturing skills. This was C and C machines,
precision manufacturing. And the community college folks
were saying that they are having trouble recruiting. And the reason they are having
trouble recruit something that they go home and the
mom says, you know, I want my kid to do computers. And we were standing in the
middle of the manufacturing floor and the operator said,
I am running a computer. I am running a computer
that happens to be attached to a machine. But this is a computer job. It is not you know the same kind
of a manufacturing as before. And we have — we have a lot
of work to do I think to change that fear that you will go
into a skill and there won’t be a job there. And this effort, and this moment
and all of you who are telling your stories and conveying the
message have a lot to do with helping our youth and our next
generation get in a pathway that successfully takes them to a
good paying job that is going to stay here. And that is something that this
administration has a lot of engagement with, a
lot of program around, and we are highly committed and
succeeding I think in building the foundation to do that. Harry Moser:
I have been promoting an idea
that ties together the need for financing and the need for more
skilled work force and the SBA. So the idea would be that for
companies that can’t get loans, conventionally, let’s say they
are not an A, B, C credit, they are a D credit. They are not an
F, but maybe a D. And if the SBA
guarantees the loan, for every let’s say
250,000 or $500,000 worth of loan
that is guaranteed, they have to have one
registered apprentice. Okay. You can’t get the
money on your own. Well, if we are going
to guarantee it for you, you have to contribute something
to society by training the people that will help you
or help some other company in the future. Karen Mills:
I think that is a great idea. And does tie together
specifically a lot of the things that I think we have heard from
folks here or labor this morning who are very committed to
apprenticeship as well. Department of Labor that has
a good apprenticeship program, where we do have capital
available, grants available. I am going to turn to
the audience for a whole set of questions. So think about that. And then I am also going
to turn back to the panel, I have a few more
questions for them. Yes. Another call center. Audience Member:
Yes. Administrator Mills, it is
just such a tremendous story to have been part of the 2009
jobs forum and have seen you firsthand take all of the
suggestions that came out of our session into action, and
create the results that you have — Karen Mills:
Say your name. Audience Member:
I am Angie Sullivan. And I am the chairman of
Arise virtual solutions. So I just want to applaud
you for the great progress you have — Karen Mills:
Angie gave us a long laundry
list at that 2009 time of things we need to get done. Audience Member:
I have a list. Karen Mills:
So what is your — Audience Member:
Right. So I think one of the
things that I am delighted to hear in this panel is the
focus on the service industry. Much of the — of the discussion
today has really been focusing on manufacturing jobs
and we do know that 80% of employment today in the
United States is a service sector focused role. And so couple of
things to consider. The first is, as we are focused
on trying to build skills, there is a suggestion about
connecting to community colleges, but I would like to
suggest that we take half of the 280,000 identified teachers, who
are identified as not employed in the jobs act and suggest that
they be skilled up to be able to learn how to teach
people jobs skills. And in the service
sector, for example, if we could take and teach those
folks how to deliver those jobs skills in the virtual manner,
what we are able to do then is educate people without any
constraint around bricks and mortar facility, because we
allow people to connect from their computer at home and be
able to skill themselves up to be able to perform these —
these new service oriented jobs. Karen Mills:
That is a great idea. And one of the things that I
know that you do and some others do, you have a lot of home
based call centers people. So it is another — Audience Member:
Right. Thank you. Yes, we have 22,000 folks
today in the United States who actually do back office and
call center work from home. And that number since we have
had the opportunity to be together since 2009 has doubled. So we were 11,000 when we last
saw you, and we are now 22,000. And we expect another 8,000
workers in the United States alone in 2012. And so the second idea then is
really to be focused first like we talked about,
first on skills. But second on the work. And so I would like to
encourage the Small Business Administration as well as
the government at large, to look at work that is being
done today that has a belief that it has to be done in a
bricks and mortar facility. Because what we are finding
the progressive companies, many of the fortune 500
companies today are doing, is they are looking at ways in
which work can be virtualized. So that the work can be placed
with a worker as opposed to making workers have to actually
commute or relocate to a community in order to
be able to find the job. We know what the housing
market challenge is today. It is very difficult for
people to decide to relocate. So virtualization of work allows
us to actually move the job or the work that is being done
to where the worker actually resides and allows them to do it
in a very green oriented manner by being able to perform
that work from home. So that would be the second
suggestion I would make. Let’s look for ways to take work
that people consider has to be done in a bricks and mortar
center today and let’s figure out how to virtualize that
work and send it home. Karen Mills:
I am glad you mentioned that. Part of the business case in
bringing them home back to the United States and being able
to do it at 15% cheaper is the work at home model. And I know for businesses
it is about 30% cheaper. But for the employee,
for the employee, they actually see a pay — sort
after pay raise to their cost base of at least 6%. Or six thousand dollars,
maybe 8,000 if you think it is not being taxed. Audience Member:
There are other costs
seem associated with it. No longer having to compute. Not having to outfit yourself
with a professional wardrobe, et cetera, really puts
more money in the pockets of American workers. And so we had over hundred
thousand people express interest last year in being
able to work from home. Karen Mills:
And this is one of the things
that we see over and over. And when we look at
entrepreneurs here, which is you can reinvent the
way work is done and how we do it here. Because technology will allow
you to connect everybody securely in the
home for instance. So we can you know, we
can continually look for new opportunities. Yes. Gentleman there? Audience Member:
My name is Lonnie Cane, I am
an apparel manufacturer from Los Angeles, California. And yes we still make
clothing in the United States. We all sold to Wal-Mart but
better department stores and up. And that business, those
jobs are coming back. Like we have heard earlier,
there are issues in China. It was raising prices. There is a drop in quality. We found over a year ago that
we were having more and more difficulties with the products
we were bringing out of China and looked into — we maintain
some production in the United States and we looked
at how we can do more. One of the issues facing us,
there is a number of issues facing us. But one of the issues,
one, vocational training, is horrible in California. The State Board Of
Education curricula, is every child
who does graduate, not many do graduate in
California from a high school, will be trained to go on
to a four year education, not become a plumber and not
to become an electrician. We need that education. We need to deal
with the reality and in a realistic
way with immigration. We have — with we have
— our, we as a country, have looked past
immigration as an issue. And until we deal with that, we
have a work force in California, predominantly Latino,
predominantly illegal, they are — they are going to
feed their families some way. They are working. Mostly illegally. But companies like
American Apparel Company, very large region T-shirt
company was raided. They lost 5,000 jobs in the city
of Los Angeles through a raid. There’s food companies
throughout this country that are being raided on a
regular basis by ICE that are losing thousands of jobs. They cannot find replacement
people to put back in there. We need to be realistic. We need a work visa program that
is manageable and realistic for the problems we face. Karen Mills:
Thank you. And I think you probably
are following some of the immigration discussions that
the President has put forth, some proposals on that. And I think there is a lot of
agreement that these are issues that we need to get solved. Yes. Audience Member:
My company — (inaudible) Karen Mills:
Can you stand up so everybody
can see you and hear you? Audience Member:
(inaudible) Our company has been
manufacturing products in the US. We have the largest sleeping
bag factory in this country. And we have been bringing
jobs back to this country. We have been expanding our plant
in — (inaudible) — Alabama. And one of the big
issue that is we have, is being competitive in the
global market is materials that we can’t get in the US
that we are having to import, we are competing with other
countries getting free trade zones. It is — I know it is
part of the furniture. I don’t know if you still bring
in some of your raw materials that you can’t get in the US. How could we bring our costs
down to compete against international companies that
are working in the future? Bruce Cochran:
You used to be able to buy
those things but they all went to — I have the same
problem with hardware, decorative hardware. And even drawer glides that I
can’t get in the United States. Well, there are some made
in the United States, but they are very,
very expensive. Same with decorative hardware. Used to be literally dozens of
decorative hardware manufacturers in the United States,
now there is none. So that is a good point. Karen Mills:
Right. And Tara, did you want
to say something to that? Yeah, so we have some ideas
about helping you with some of this sourcing. And also if you wanted to
produce any of that in-house, how you might you know get
some — some of the financing to do that. One of the things that you
wanted to mention, Bruce, was the level playing field. Did you want to talk
about that a little bit? Bruce Cochran:
Well, you know, there is
a level playing field now. I feel like we can definitely
compete with the Chinese and the other Asian countries. And it is going to be
interesting to see those people that will also take
these — these initiatives and manufacture furniture again
and other consumers products in the United States. One thing that hasn’t been
mentioned today is that the furniture industry in China was
heavily subsidized to and they always had export initiatives
to sell products in China and Chinese businessmen got
very wealthy with it. Those — those export
generous subsidies in China have all but disappeared. But now — now they are
incentivizing these same factories to sell
products domestically. So you are getting exports
subsidies that use today be for export. Now they are subsidies
for domestic sales. And that will really really
impact not only furniture, but all consumer products here. We will be selling
furniture to China. There is no question about it. They love — they love — Asians
love American made products and there is a real appetite for it. Cost is not an issue. Karen Mills:
So I say, made
in America is hot. How many of you sort
of got that sense? Yeah. Bruce Cochran:
Made in America means
a better America for sure. Audience Member:
I am James Curleigh, and
I am CEO of Keen Footwear. Portland, Oregon. And it is interesting, I
have had a fascinating day, watching the different journeys
of different companies. And we find ourselves now in
a place and I kind of speak on behalf of the outdoor industry
as well where you know certainly for our company, we got through
our working capital situation. We have got our
innovation platform, we built a factory
in Portland, Oregon. We launched a new category for
steel toe foot wear outside of outdoor to sort of expand,
grow, and innovate. And last year we had 95 people,
we went — we went pass the hundred person mark
for the company. We went from 95 to 132. But the challenge we have now is
not so much around the dynamics that we are hearing about today. When I look to the future,
you say made in America. We are building
products in America. How do you protect that? The outdoor industry because we
have brands that are appealing around the world, the
brands like The North Face, who are the you know in our
terms they are the big guys. And right down to some very
specialized brands and the notion of protecting
not only the innovation, intellectual property and quite
frankly just the counterfeiting dynamic is — is rampant. And it is not just
product for product. Making an item look like
ours and selling it. There is the digital platform
that gets set up quickly. The product gets to
the market quickly, faster than ever by the way. And our ability, you know, the
obstacles course or call it the opportunity course we are on,
just when we figure one thing out, we look ahead and we say,
gosh, we got hit with this. And it would be interesting
to see what the Small Business Administration can do
once you’ve built this. Let’s assume in ten years
we’re wildly successful, how do we protect that
platform so that there’s a cost to innovation. And the challenge here,
I heard you this morning, the software you’ve created,
does it take into consideration the mid and long-term cost of
innovation and that innovation evaporating, because if it
does, we need to deal with that. Karen Mills:
Harry, do you want
to tackle that? Harry Moser:
So one of the — how many
of you have heard that we’re supposed to be an
innovation country? Innovation country. And almost the implication is
that we should — we should innovate, you know,
be sort of like Apple, we innovate and then
forget about manufacturing. And in Apple’s case, I think
25,000 employees are in the U.S. and something like a half
million to three-quarters are in China actually making
the things and shipping them all over the world. So Apple has a trade
deficit, so to speak. So if you want to innovate,
in Apple’s case it’s worked, but in general, it doesn’t
work well when you separate engineering from manufacturing. Repeated studies by Pisano and
Shih at Harvard Business School, Michael Porter at
Harvard Business School, have shown when you — if you
get — if this is how it used to be with engineering and
manufacturing together and you let the manufacturing
come over here, the effectiveness
of communication, the effectiveness of
collaboration drops off dramatically. And we’ve seen that with cases
where it’s been brought back by GE, by NCR, by others, bringing
it back, putting them together, the innovation works. Now, because if you let the
manufacturing go over here and if you don’t bring it back,
pretty soon the logical solution is that your engineering
goes over there, too, to get it back together
to get that efficiency, and now you have neither of
them and now you essentially have nothing. So we think it’s absolutely
essential to keep — to be an innovation country, we have
to be a manufacturing country. Karen Mills:
I will say that this a
big part of the Advanced Manufacturing Partnership,
which is universities, some corporate leaders and the
Administration working together on keeping manufacturing, doing
advanced manufacturing and keeping the pilot stage of that. Right after innovation,
when you start to scale up, keeping that here, because it’s
really in that first scale-up stage that a lot of the
innovation gets well understood and codified, and if you’re
doing that somewhere else, then the final
production will be there. But if that manufacturing
process expertise happens here, then it’s a foundation for
the next set of jobs here. So we’re very focused. I think we can take a
couple more questions. In the back. Audience Member:
Yes. My name is Bill Robichaud,
I’m the founder and CEO of Collaborative Consulting. We recently opened up a
domestic development center in Wausau, Wisconsin. And by the way, I vacation
in Maine all summer. My question, well, we’re trying
to bring technology jobs that have been going to India and to
China back to the United States. And so my question
is to you, Harry, you stated that — that you
believe that a 20 to 30% hidden costs in manufacturing
by having jobs overseas. Do you also feel that same 20 to
30% hidden costs is in services, in I.T. services as well? Harry Moser:
I think it’s a lot more
difficult to measure and more functionally dependent. In manufacturing, it’s easy to
measure the duty and the freight and the carrying cost to the
inventory and the — all these things, so it’s just a series
of things that are relatively easy to measure. Whereas with services, it’s
a greater question about the relative productivity
of the two. There’s still travel
costs to go check on them, there’s still intellectual
property risk, but it’s — I mean, I would
on that — on the subject of services in general, I would
give way to the experts here who have noted that it’s about
equivalently costly offshore and domestically, and domestically
the quality is higher and the customer satisfaction is higher. I’d be glad to — I’d be glad
to meet with you after and start working on that project
if you’d like me to find a better solution. Mary Murcott:
As a former CIO, I will tell
you it’s exactly the same, different metrics,
exactly the same issues. The communication issues about
what we wanted and the arguing back and forth about product and
what we meant by — it was even more amazing in I.T. to me when
I ran a major I.T. operation. So I think it’s
very, very similar. Audience Member:
We’ve met with great success,
we’ve taken on two projects recently that we’ve taken two —
two sets of jobs that were going to India and we were able to
take them to the United States and house them in
Wausau, Wisconsin. So we’re very — Mary Murcott:
In Waukesha? Yeah. Audience Member:
Wausau. Mary Murcott:
Oh, Wausau. Well, one of the things I really
encourage people is if you’re offshore right now, go ahead
and do the same activity, be it at a call center or
whatever on-shore so that you can take a look at the
productivity lines or code or whatever it is, the
output, and you can really make a comparison. When you’ve shipped
everything over there, it’s really hard to tell. Audience Member:
Thank you. Karen Mills:
Yes. Audience Member:
My name is James Mason with
the Onshore Technology Services, we’re a rural I.T.
outsourcing firm, so we do software development
and data services and stuff like that, and we compete
for work that goes offshore. Actually I — if it’s the
same collaborative consulting, we’ve worked together
with one another. We haven’t met in person,
but they’re our customers. (laughter) Karen Mills:
That’s good. We like it
when business gets done here, you know. Audience Member:
I have an idea, and it’s
really — it’s a dream. We — so the problem that we’ve
solved at Onshore is we figured out to retool underemployed
dislocated workers and put them into advanced software
development jobs just by extremely focused boot
camps and training. In rural America, there’s
like 60 million people, and they pretty much have
been over-shot by the I.T. economy and all of its advances. Why can’t we — I mean,
when I see (inaudible) 22,000 jobs, and Mary, I
applaud what you’re doing, couldn’t we just really get
together and say, you know, so there’s 3 million people
— there’s 3 million jobs that can’t be filled right now,
there’s 14 million people not working, so just with targeted
efforts and us just getting together and being aggressive in
how we give those people those skills, couldn’t we
just say, I mean, even with the people
in this room, hey, let’s create a million jobs? And then just do it? Karen Mills:
This is — I think what
you’re saying is exactly what the President has said and
this administration has said, and the nuts and bolts
of that are, you know, part of what you see
happening around you, part of the pieces that come out
to do that is we have to have our small and large businesses,
our supply chains connected to our training programs, our
improvements in education. And that’s one of the things I
have to say I hope you take away from today, which is —
Bruce, you said this to me, when you actually come here
and you see what’s happening, there’s a lot of talk about what
doesn’t go right in Washington, but on the other side we’re
taking a lot of program that’s out there and focusing it. Now is the time that we have to
be very efficient on doing what you said, which is whether
it’s workforce training, we have to make a better match
between the skills that we train for and what the
businesses need. And one of the ways we’re doing
it I’m very proud to say is that small business has a much
larger voice, we’re listening, we’re finding ways to get what
small businesses need and making those connections. And part of it, it’s
a retail operation, it’s happening in clusters,
it’s happening with our mayors, it’s happening with linkages
between folks like the Department of Agriculture that
operates in rural America, and our forces, our
small business groups, so we are — and if you see ways
in your communities that we can be of more help, that we can
facilitate the activity of your business to find more capital,
find more trained workers, connect, get permitted better,
we are committed to being on the ground, whether it’s the
Select USA Operation, whether it’s our on the ground
operations that we have. We have 900 small business
development centers. So there’s one probably within
45 minutes of your business. And if you’re thinking about
issues that you have in growing your business, we want to make
sure whatever door you open in the federal government, you can
navigate your way to a solution that is helpful to you. That’s how we need to
make government work in the 21st century. It has to be seamless to you,
whether you’re navigating from SBA or the labor department; we
need to make sure the solution is finding its way to you. So with that pitch, I will tell
you we launched — the President announced a while ago a
website for small businesses, and there’s the, those
are places that you can come and put in what it is
that you’re looking for, and we can find more and more
effective ways of connecting you to those federal resources. Now, do we have a
closing chat on — Speaker:
If you could take
one more question. Karen Mills:
I will take
one more question. And just want to make sure — we
had hoped Nancy-Ann DeParle who is fabulous will be here. I’ll take one more question
and — but before that, I really want to say, the
President said to Gene Sperling coming over and said to me
walking back over there that the discussions that he
has had with all of you, the things he has
heard from all of you, you’re going to be
hearing that back, because he really appreciated
understanding where you are in bringing your business
back to this country, what it will take for
you to do it and how we can be your partner. Yes. Audience Member:
I’m Rodney (inaudible),
I teach at Rochester Institute of Technology
in Rochester, New York. It’s been a great meeting
and lots of inspirational stories here. I wonder — the academic side of
me wonders to what extent this is — we’re measuring
what’s going on. Certainly on the good side
we look at trade deficits and things like that. Are there any efforts by the
Administration to start to measure this both at the
— sort of macro level, but also these
individual case studies? And Harry’s work, of course,
has been instrumental. Harry Moser:
If I can answer that. We have — Karen Mills:
We have good partners, too. Harry Moser:
We have a library that
accumulates all of the articles, all of the published
cases about reshoring, about work that’s
actually come back, and it’s — right now it has
about 100 articles in it, in a couple of months it will
have 300 when it gets up to date, and it will be
searchable, sortable, et cetera. So we encourage — first we
encourage any of the media that’s left to write lots of
reshoring articles to push the trend, and we can help
you find the cases. And then second, anyone who
comes across the cases for your company or otherwise
to send them to me, we’d get them all
into that database. And then — when I’ve
searched it in the past, searched that and
searched the web, you find the reported cases
of reshoring doing this. Now, it isn’t absolute proof,
it could be they are just being reported better. But there’s enough of it
happening and enough — enough of the contract manufacturers
that I talk to who say they’re doing dramatically more of
it today than they were a couple of years ago. So it’s still
somewhat anecdotal, but our library would be
the best quantification that I know of. Mary Murcott:
On contact centers, I brought
some copies of my white paper on some of the metrics that I use
around customer satisfaction and cost and things like that,
you’re welcome to that or get it on my website, number 1
dot com, so we’ll just — Karen Mills:
Well, I want to thank the
panel and I want to thank all of you for coming
and spending the time. Christine Cornelius [phonetic]
and Andy Sian [phonetic] and all of you who helped
pull this together. Well, I think we have
Greg for some last words. All right. Thank you. Thank you very much. (applause) Speaker:
Great. Thanks, everybody. Well, we have one final speaker
who just wanted to get a chance to come over and say thanks. And it’s my pleasure to get
a chance to introduce her. Now that I work in the White
House and the government, I get a chance to see how
a lot of things work on the policy side. And the next speaker you’re
about to hear from is the person who makes things happen
for us on policy, makes sure that all of our
policies actually focus specifically on the folks
its intended to help small businesses have been a
big part of our work and of her portfolio. So with that, I want to
introduce Nancy-Ann DeParle who is our deputy chief
of staff of Policy. (applause) Nancy-Ann DeParle:
I just want to thank again
all the business leaders, advocates and officials who
shared with us today and with the President and Vice President
your stories about bringing jobs back to America. The President and the Vice
President noted that America the best place in the world to
do business and create jobs. And after hearing from
all of you all today, I think we can agree. Throughout the day, we’ve heard
that the economics are clear, that locating in the U.S.
makes sense for companies that are both manufacturing
and providing services. The U.S. has added over 300,000
manufacturing jobs in the past two years, and we’ve
improved our competitiveness. The businesses that we heard
from today are making the choice to start, invest, and
grow in the United States, creating jobs here at home
because it makes sense for their bottom lines, from
large businesses like Ford, to international
businesses like Siemens, from manufacturers
like Master Lock, to small businesses like
Lincolnton Furniture in North Carolina, which is adding
130 new jobs and restarting operations at an
once vacant plant. These companies are bringing
jobs back because locating here offers a competitive
cost structure. The ability to provide better
consumer service and to respond more quickly to
their customer needs. At the same time, we’ve heard
from all of you all that nothing competes with made in America,
quality and reliability. And as the President and the
Vice President mentioned today, we’re calling on other
companies to follow their lead, to follow your lead and to bring
jobs back and invest in America. The President asked you today
and asked all companies to do whatever they can to look for
every opportunity to bring jobs back here. We can, from the federal
government’s perspective, and do more, and should do more
to accelerate the insourcing trends that we’ve
heard about today. And one of the reasons we wanted
you all to come here is so that you could give us more ideas
about what we could do to make it easier for you
to bring jobs back, to locate your businesses and
the expansion of your businesses here in the United States. Over the past three years, the
President has put forward and implemented policies
like tax breaks, research and
development credits, and the recently signed trade
agreements that several of you noted have helped to ensure that
your businesses can compete. Today we announced
some new initiatives, including new tax proposals to
reward companies that choose to invest or bring back jobs to the
U.S., a proposed expansion to the recently launched select
USA program that helps build federal, state and local
partnerships to attract investment to the U.S. Increasing support for states’
efforts to promote investment through federal officials and
export assistance centers in more than 100 cities. We’ve heard today that
perhaps our greatest asset is our skilled
and productive workforce. And we heard that over and
over again about how much more productive our workers are
and how much more they’ve gotten even over the last
couple of years. We will continue to develop
partnerships between labor, education and businesses to help
ensure that America’s workforce is ready to respond to
the needs of the future. In addition to the great
programs highlighted by companies here today, we’re
working with skills for America’s future and the
President’s jobs council to ensure that workforce and skills
training remains a key element of our economic strategy. Most of all, though, we thank
you for taking your time to come here today because we need
to continue to partner with all of you. As many have said, one of the
biggest barriers to insourcing is the lack of awareness
about the potential economic advantages of the U.S., so we
hope that today we’ve helped to shine a bright light on the
potential economic advantages of doing business right here in
the U.S., and that you will go out and continue to be
ambassadors for that. By working together, we can
address this lack of awareness, and we look forward to getting
it done with the White House as your partner. Thank you very much. (applause)

Danny Hutson

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