By Robert Gavin, Globe Staff
Massachusetts and New England are thriving centers of advanced manufacturing, which, if supported with the right policies, could generate thousands of high-paying jobs a year, a new study concludes.
evolved into a cutting-edge industry of sophisticated products and highly skilled workers, according to the study by the New England Council, a nonprofit regional advocacy group. Few places in the world can match the concentration of skills, innovation, and capital that drives advanced manufacturing in New England and provides a competitive advantage that could generate up to 8,000 new jobs a year.
"This is a sector with underrealized potential," said New England Council president James T. Brett. "If we do the right thing, we can create jobs."
Advanced manufacturing, which makes everything from navigational instruments to medical devices to nanotechnology products, differs greatly from traditional manufacturing. Instead of low-cost labor and high production volumes, advanced manufacturing relies on skilled workers and specialized, complex products.
Advanced manufacturing accounts for about 400,000 jobs, or nearly two-thirds of all manufacturing employment in New England, according to the study. The highest concentrations of advanced manufacturers are in Connecticut, New Hampshire, and Massachusetts.
New England's strength in advanced manufacturing comes from the region's unparalleled network of scientists, engineers, researchers, financiers, and skilled machinists, according to Mike Reopel, a principal at Deloitte Consulting in Boston and the study's author. Before the recent recession, employment in advanced manufacturing was growing at about 2 percent a year in New England.
In many ways, the sector has been overlooked by policy makers, who tend to focus on hot industries and large companies, Reopel said. For example, state manufacturing policies often include tax breaks that generally benefit big companies with large profits. But such tax breaks don't produce much savings for the small, lower-profit firms that dominate advanced manufacturing in New England.
Of greater value, Reopel said, would be loan programs, since finding financing to expand and hire is a regular problem for small advanced manufacturers.
"It's these small firms that are actually trying to double their employment,'' Reopel said, "but their access to capital is virtually nonexistent."
Advanced manufacturing is already a key component of the state's economic strategies, said Greg Bialecki, Massachusetts secretary of Housing and Economic Development. The state has put in place programs to boost advanced manufacturing, including tax breaks for capital investments, loans through quasipublic development agencies, and workforce training.
"Advanced manufacturing has the potential to be a significant part of the Massachusetts economy for many years,'' Bialecki said. "It relies on technology and innovation, so we can be in the hunt. We are going to talk about advanced manufacturing in a much more high profile way."
Advanced manufacturing already has a strong presence outside Greater Boston, and it could provide a catalyst for development in areas such as Western Massachusetts, where a number of precision manufacturing firms are concentrated, Reopel said. Earlier this week, Federal Reserve Bank of Boston president Eric Rosengren said the high costs of housing and wages in the Eastern Massachusetts make it difficult for manufacturers to expand. But, he told Boston Globe editors and reporters that Western Massachusetts, with a lower cost of living, abundant space, and even cheap hydroelectric power could be promoted as a growth area for manufacturers.
One of greatest challenges is changing the image of manufacturing, still perceived as "dark, dirty, dangerous and declining,'' the study said. Few outside the industry realize advanced manufacturing is clean and technology-based, using advanced computers, requiring workers to have technical skills, and paying them well. The study estimated average pay and benefits at about $80,000.
Manufacturing's out-of-date image, in turn, contributes to another problem facing the industry: a labor shortage. Since few students consider manufacturing as a career, the study said, a lack of skilled workers threatens the growth of the industry - a problem that may only get worse as the baby boom generation retires. Before the recession, Reopel said, up to 4,000 jobs went unfilled in manufacturing because employers couldn't find qualified workers.
The study calls for renewed efforts to rebrand manufacturing as a clean, technology-based industry. It calls for closer collaborations with schools, community colleges, and universities to promote manufacturing as a career, and increase hands-on technical programs.
The study also recommends closer collaboration among manufacturers, engineers, scientists, and other professionals to strengthen the networks that spur innovation and support the industry. The industry also needs to build partnerships with governments to expand worker training programs.
New England states, the study stressed, should recognize that economic activity doesn't stop at borders, and cooperate on policies that promote advanced manufacturing throughout the region.
"What's good for New Hampshire is also good for Massachusetts," said Reopel. "If we just isolate ourselves in a few communities, we're going to die."
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