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Washington gets earful from auto suppliers on skilled worker shortage

By: Bill Bregar

October 5, 2012

WASHINGTON (Oct. 5, 2 p.m. ET) — Steve Braig, president and CEO of Trexel Inc., was among automotive suppliers who delivered this message to senior Obama administration officials in the White House recently: American manufacturing needs more skilled workers.

Braig said he was invited, about two weeks before the event, to attend the Sept. 28 White House Business Council meeting titled “American Economic Competitiveness Series: Auto Supply Chain.” Other panel members included eight CEOs of automotive component suppliers, a couple of material suppliers, representatives of trade associations, the United Autoworkers and environmental and energy groups.

Braig gave his account of the four-hour meeting in a detailed email and follow-up interview with Plastics News. Trexel, in Wilmington, Mass., developed MuCell molding technology.

According to Braig, acting Secretary of Commerce Rebecca Blank opened the meeting by highlighting how the government bailout of General Motors Co. and Chrysler Group LLC saved jobs at the automakers and their suppliers. She added that the aggressive improvement in Corporate Average Fuel Economy standards will spur innovation that will create a lot of good-paying jobs, to meet the higher average of 54.5 mpg by 2025.

“They said we still have these millions of unemployed and underemployed people, and this will help them get jobs,” Braig said.

“That was met with instant push-back by the panel,” Braig said. It prompted a discussion of a skilled-worker shortage. The industrialists said the auto industry is already at full employment when it comes to skilled technical people — and needs more of them.

“Although there is availability of Ph.D./doctorate type of researchers, there is an immense shortage of qualified engineers,” Braig said. The manufacturing officials also noted the lack of trained welders, electromechanical technicians, machinists and other skilled trades.

“Everybody brought this up,” he said. “That was widely discussed.”

Braig stressed that he does think the movement to more fuel-efficient cars will help the plastics industry, by reducing the weight of cars and promoting new reinforced-plastic structural components. And the automotive people at the White House event appreciated the Obama administration’s focus on manufacturing, including the bailouts during the severe recession, he said.

But Braig said: “Our country simply lacks the knowledge and availability of qualified technical resources to bring back many of the migrated manufacturing activity, or to create substantial new manufacturing activities.”

Union leaders at the White House meeting cited their efforts in training. While the manufacturing officials praised that work, they said it does not go far enough.

Braig said the workforce discussion ended with a call for the federal government to take a more active role in advancing math and science in elementary and secondary schools, and “to create more vocational training as an alternate to college education.”

Braig said the group agreed that the skilled-worker issue is a long-term problem. “There is no quick fix,” he said.

Another discussion centered on the federal R&D tax credit, to help companies conduct research and development. Here, Braig said Germany and other major competitors have generous financial grant programs to promote R&D, and reward companies that work with universities.

The U.S. government treats the R&D tax credit like a political football, routinely letting it expire and then debating whether to bring it back. Industry wants the government to make it permanent.

“We’re competing against the Germans and the Japanese in the automotive industry,” Braig said.