One Project’s Effort to Address Manufacturing’s Succession Crisis

By Jesús Espinoza
| Getty

Without someone to take the reins, manufacturers are vulnerable to outsourcing.

Many American manufacturers have a succession problem, especially in the Chicagoland area.

More than 60 percent of manufacturing companies there have no clear successor, according to the University of Illinois at Chicago's Great Cities Institute. And so the Ownership Conversion Project (OCP), a consortium of business, labor, and economic development groups spearheaded by Chicago-based nonprofit Manufacturing Renaissance, has taken the initiative to address this glaring problem.

How? OCP aims to address the succession problem by connecting current factory owners with potential buyers, especially potential buyers from underrepresented groups, such as African Americans and Latinos/as.

Why does the succession of manufacturing company ownership matter? A big reason is because manufacturing companies without a clear successor, be it a family member or a buyer in the community, become more vulnerable to buyouts from powerful firms with few ties to their surrounding communities.

And with few ties, outsourcing becomes much easier.

As the past decades have shown us, outsourcing is much more than jobs going overseas. It’s the dismantling of entire communities along with the livelihoods that sustain them. It’s the abandonment of ethical labor and environmental standards in exchange for lax regulations abroad that exploit people and the environment.

It’s about losing a lot for many in exchange for a few extra bucks for a few.

OCP strives to tackle this fundamental issue for American manufacturers with the goal of sustaining the health of manufacturing communities. With the project's focus on diversity and inclusion, it works hard to guarantee that manufacturing’s benefits reach all members of the area.

Manufacturing Renaissance’s OCP is a remarkable example of how communities and manufacturers can work together to thrive. Supporting projects like this are essential to fostering American manufacturing and empowering manufacturing communities throughout the U.S.

Read more about Manufacturing Renaissance and its Ownership Conversion Project in this Forbes piece. And find Manufacturing Renaissance on Twitter, Facebook and Instagram.