NAM Talks Tax, Trade, Workforce and AI with the Financial Times – National Association of Manufacturers – NAM

Report on U.S. Manufacturing Policy and Alignment with Sustainable Development Goals

Fostering Economic Growth and Industrial Innovation (SDG 8 & SDG 9)

An assessment of recent U.S. tax and regulatory policies indicates a positive impact on the manufacturing sector, fostering conditions conducive to achieving Sustainable Development Goal 8 (Decent Work and Economic Growth) and SDG 9 (Industry, Innovation, and Infrastructure). According to Charles Crain, NAM Managing Vice President of Policy, at the Financial Times–Nikkei Investing in America Summit, these policies have been foundational for growth and investment.

• The 2017 Tax Cuts and Jobs Act (TCJA) was identified as a primary driver, stimulating the sector through pro-manufacturing provisions such as immediate expensing for factory construction, capital equipment, and research spending.
• These measures directly support the targets of SDG 9 by encouraging investment in resilient infrastructure and promoting sustainable industrialization.
• A key challenge remains in ensuring that subsequent policies, particularly in trade and workforce development, complement this agenda to fully unlock manufacturing potential and advance progress toward SDG 8 and SDG 9.

Advancing Decent Work and Quality Education (SDG 4 & SDG 8)

The manufacturing sector faces a significant labor shortage, with 400,000 open positions, highlighting a critical need for workforce solutions that align with SDG 4 (Quality Education) and SDG 8. Addressing this skills gap is essential for sustained economic growth and ensuring decent work for all.

1. Skilled Labor Requirements: The industry requires both highly skilled professionals, often sourced via H-1B visas, and specialized manufacturing talent, including technicians, welders, and machinists.
2. Domestic Workforce Development: In line with SDG 4, manufacturers are actively engaged in building a domestic talent pipeline. Key initiatives include:
   • Partnerships with community colleges to develop relevant curricula.
   • Workforce-development programs such as the Manufacturing Institute’s Federation for Advanced Manufacturing Education (FAME) and Heroes MAKE America.
3. Immigration’s Role: A functional immigration system is presented as a necessary component to supplement domestic efforts and fill immediate skills gaps, thereby supporting the objectives of SDG 8.

Strengthening Infrastructure and Global Partnerships (SDG 9 & SDG 17)

To realize its full potential, the U.S. manufacturing sector must overcome barriers related to infrastructure development and global supply chains, areas directly addressed by SDG 9 and SDG 17 (Partnerships for the Goals).

• Permitting Reform: Comprehensive permitting reform is required to accelerate critical infrastructure projects, a core target of SDG 9.
• Supply Chain Resilience: The U.S. economy currently produces approximately 67% of the inputs needed by domestic manufacturers, against a maximum capacity of 84%. This gap underscores the importance of resilient and efficient supply chains.
• Aligning Trade Policy: It was noted that manufacturers require access to specialized raw materials, equipment, and machinery that are often only available through global trade. Therefore, it is imperative that U.S. trade policies are aligned with domestic tax and regulatory policies to support, rather than hinder, industrial growth, reflecting the principles of global partnership outlined in SDG 17.

Integrating Innovation for Sustainable Industrialization (SDG 9)

The adoption of advanced technologies, particularly Artificial Intelligence (AI), is transforming the manufacturing landscape and presents a significant opportunity to advance SDG 9 by upgrading the technological capabilities of the industrial sector.

• Promise of AI: AI is being leveraged to achieve substantial gains in multiple areas:
  • Driving operational efficiency.
  • Innovating product design.
  • Improving worker safety, which also contributes to SDG 8.
  • Optimizing supply chain management.
• Workforce Adaptation: To maximize the productivity gains from AI, a concerted effort is needed to train both new and existing workers. This focus on upskilling is critical for ensuring the workforce can effectively utilize and collaborate with AI technologies, linking technological innovation back to the goals of quality education (SDG 4) and decent work (SDG 8).

Relevant Sustainable Development Goals (SDGs)

The article highlights issues and initiatives that are directly connected to several Sustainable Development Goals, focusing on economic growth, education, and innovation within the U.S. manufacturing sector.

• SDG 4: Quality Education

  The article emphasizes the critical need for workforce development and reskilling. It mentions initiatives to train workers for specific roles like technicians and welders, partnerships with community colleges, and the necessity of preparing the workforce for new technologies like Artificial Intelligence (AI). This aligns with SDG 4’s goal of promoting lifelong learning opportunities and ensuring people have relevant skills for employment.

• SDG 8: Decent Work and Economic Growth

  The central theme of the article is the promotion of economic growth in the manufacturing sector through tax and regulatory policies. It directly addresses the creation of jobs by referencing the “400,000 open jobs” in the industry. The discussion on improving worker safety through AI and the need for a skilled labor pool to drive productivity connects directly to the goal of achieving full, productive employment and decent work for all.

• SDG 9: Industry, Innovation, and Infrastructure

  The article is fundamentally about strengthening the manufacturing industry. It discusses policies that encourage investment in “factory construction, capital equipment purchases and research spending.” Furthermore, it highlights the adoption of advanced technologies like AI to “drive efficiency,” “design products,” and “improve supply chains,” which are core components of building resilient infrastructure, promoting inclusive industrialization, and fostering innovation.

• SDG 10: Reduced Inequalities

  The article touches upon immigration policies as a solution to workforce shortages. The mention of using H-1B visas and the need for an “immigration solution to fill those skills gaps” relates to the goal of facilitating orderly, safe, and responsible migration and mobility of people, which can help address labor market needs and reduce inequalities.

• SDG 17: Partnerships for the Goals

  The article points to the importance of collaboration. It mentions manufacturers “partnering with community colleges” for workforce development programs. It also implicitly calls for partnerships between government and industry by urging the administration “to ensure that trade policies align with the tax and regulatory policies that drive our industry’s growth,” highlighting the need for a multi-stakeholder approach to achieve economic goals.

Specific SDG Targets

Based on the article’s content, several specific SDG targets can be identified as being directly relevant to the issues discussed.

1. Target 4.4: Increase the number of people with relevant skills for employment

   The article’s focus on “workforce solutions to reskill the manufacturing workforce” and train “technicians, welders, machinists and electricians” directly addresses the need to increase the number of adults with relevant technical and vocational skills for employment, as outlined in this target.

2. Target 8.2: Achieve higher levels of economic productivity through technological upgrading and innovation

   The discussion on how companies are using AI to “drive efficiency, to design products, to improve worker safety, to improve their supply chains” is a clear example of efforts to achieve higher economic productivity through technological upgrading and innovation in the manufacturing sector.

3. Target 8.5: Achieve full and productive employment and decent work

   The stated goal of filling the industry’s “400,000 open jobs” is a direct effort towards achieving full and productive employment within this sector of the economy.

4. Target 9.2: Promote inclusive and sustainable industrialization

   The entire article, with its focus on policies to unlock a “manufacturing investment boom” and grow the industry, aligns with the goal of promoting industrialization and increasing the manufacturing sector’s share of employment and the economy.

5. Target 9.5: Enhance scientific research and upgrade technological capabilities

   The mention of tax policies supporting “research spending” and the industry’s adoption of AI to modernize shop floors directly relates to upgrading the technological capabilities of industrial sectors and encouraging innovation.

6. Target 10.7: Facilitate orderly, safe, regular and responsible migration and mobility of people

   The call for an “immigration solution” and the use of H-1B visas to fill skills gaps connects to the implementation of planned and well-managed migration policies to address labor shortages.

Indicators for Measuring Progress

The article mentions or implies several quantitative and qualitative indicators that can be used to measure progress towards the identified targets.

• Number of open jobs in the manufacturing sector

  The article explicitly states there are “400,000 open jobs” in the industry. This figure serves as a direct, quantifiable indicator for measuring progress towards Target 8.5 (full employment). A reduction in this number would indicate success in filling vacant positions.

• Percentage of domestically produced manufacturing inputs

  The article notes that the U.S. economy “currently produces about 67% of necessary inputs” for manufacturers. This percentage is a specific indicator that can be used to track progress towards Target 9.2 (promoting industrialization) by measuring the growth of domestic production capacity and supply chain resilience.

• Investment in research and development (R&D)

  The article implies an indicator by mentioning that tax policies support “research spending.” The total amount of R&D investment by manufacturing companies can be used as an indicator to measure progress towards Target 9.5 (enhancing research and innovation).

• Number of workers trained through workforce development programs

  The reference to programs like the “Federation for Advanced Manufacturing Education (FAME)” and partnerships with community colleges implies that the number of individuals successfully trained and placed in jobs can serve as an indicator for Target 4.4 (increasing the number of people with relevant skills).

Summary of SDGs, Targets, and Indicators

Source: nam.org