Obama Makes His Case for Manufacturing Hubs — and Overall Investment

By Jessica Chesloski
Jun 20 2016 |
File Photo

The president announces the ninth center for manufacturing research created by his administration.

President Obama stopped by the SelectUSA summit in Washington on Monday to officially unveil plans for a new manufacturing hub in Los Angeles.

But Obama did not just make an announcement about the opening of the new hub — he made a sales pitch for why United States of America is the best place to invest in.

“No other economy is crucial to the global economy than the United States. No country invests more in research and development. We are responsible for one quarter,” Obama said. “No country has been named from CEOs around the world as the No. 1 place to invest in with confidence.”

During his remarks, Obama also provided examples of how companies have benefitted from SelectUSA and successfully created jobs in the United States. The Commerce Department oversees the program, which has facilitated more than $19 billion in investment to create or retain thousands of U.S. jobs.

“It’s easy to make the case [for United States] because behind [us] are the most talented and innovative workers in the world: American workers,” Obama said.

The hubs are a key part of the Obama administration’s effort to support manufacturing. Since 2014, the administration has overseen the opening of eight manufacturing hubs designed to make manufacturing more efficient. More are on the way, Obama said.

The ninth hub, based in Los Angeles, will be called the Smart Manufacturing Innovation Institute and become the headquarters for the manufacturing of smart sensors that are designed to reduce energy expenses and make manufacturing processes more efficient.

In order to accomplish this, the code to create the sensors will be widely available, so "all American businesses, regardless of their size or potential resource limitations, have the opportunity to benefit from the institute's progress," according to a government press release. The smart sensors are not only important for the future of manufacturing, but they will help to cut energy consumption level, as manufacturing uses almost a third of the energy consumed in the United States.

The Department of Energy is providing $70 million in funding for the new initiative, and companies including Google and General Mills are giving the other half to get the $140 million hub up and running. Nearly 200 partners from industry, nonprofits and academia from 30 states will take part in the new hub.

The other hubs are already on their way to improve technology in a number of areas, from creating lightweight parts to furthering development for 3-D printing.

In the promo video for the newest hub, Steel Market Development Institute President Lawrence Kavanagh noted that "manufacturing is a global business, and businesses here in the U.S. compete with their international counterparts."

"Smart Manufacturing drives competiveness of manufacturing enterprise. Competiveness is critical," he said, later adding that "the benefits they cascade, they multiply! That in terms generates a much faster growing and broader economy for our country.”