Manufacturing trends and predictions

Reshoring will continue, but at a slower pace

In 2015, we will see jobs continuing to come back to America, but in a more targeted way, and natural gas will be a driving factor.

Historically heavy users of the commodity, including metal and plastic fabricators, will bring jobs back to the United States due to favorable natural gas prices.

On the other hand, parts of the industry where very low-cost labor is employed will not seek to reshore jobs. The same holds true for companies with heavy foreign demand, as it’s cheaper to manufacture in the location where the products will be sold.

2015 will also see the idea of next-shoring come into its own.
 

A manufacturing boom will hit the United States

2015 will launch a new wave of domestic manufacturing, as the industry sees more growth than it’s seen over the past several years. We can expect to see between 4.8% and 5% growth in domestic manufacturing.

However, manufacturing employment won’t grow at that same rate because facilities and operations have become far more productive and efficient. Employment simply won’t keep up with growth of the industry.
 

Big data will drive big efficiency

Software has helped manufacturing achieve terrific efficiencies. That trend will continue, but the lynchpin in 2015 will be the widespread introduction of the Internet of Things. Sensor technologies will drive the concept of connected factories and will fuel the introduction of mobility-based manufacturing. Web browsers will be used as dashboards to control equipment, identify snags, and make quick decisions that previously would have taken entire teams of people to handle.

As connected factories go online, a myriad of data will be collected. In 2015, that data will be put to use in a smarter way that makes things operate more efficiently. Even smaller companies in the industry will invest more to improve their software operations.
 

Increased investment in predictive maintenance

U.S. manufacturers will make big investments in predictive maintenance technologies in 2015. The proliferation of better and less expensive sensor technologies combined with the trend of connected factories will allow greater opportunity to implement predictive maintenance systems that will cut downtime and boost bottom lines.
 

Increased investment in capital equipment

We will see a renaissance in manufacturing, and improved bottom lines will drive replacement of aging legacy equipment. Investment in new capital equipment that performs better, more efficiently, and more reliably will follow.

Manufacturing will grow at a higher rate than GDP

GDP historically has been a marker against which industries peg their overall performance. All the factors listed above will contribute to a boom in manufacturing in 2015, helping the industry outpace GDP for the first time in a long time.

Georgia Center of Innovation for Manufacturing
www.georgia.org

About the author: John Zegers is the director of the Georgia Center of Innovation for Manufacturing. He has nearly 30 years of manufacturing experience, which includes extensive time spent as a manufacturer’s representative. He also has significant experience with original equipment manufacturers in the medical, automotive, heavy equipment, and communications industries. Zegers is a National Manufacturing Extension Partnership Program member. He can be reached at jzegers@georgia.org or 404.894.0007.