Research, Innovation and Technology

Washington, D.C. – The Manufacturing Leadership Council, the digital transformation division of the National Association of Manufacturers, today released a groundbreaking report, “Shaping the AI-Powered Factory of the Future,” that reveals how manufacturers are embracing artificial intelligence on shop floors. The report, a product of the MLC’s “Future of Manufacturing Project,” underscores the need for a policy framework that supports U.S. AI growth, innovation and leadership—one that streamlines compliance, fosters transparency and aligns energy, workforce, privacy and innovation rules with the realities of smart manufacturing.

AI has become essential to modern, competitive manufacturing in America: for example, manufacturers use cutting-edge AI tools like AI-powered cameras to enhance worker safety and eliminate product defaults, AI simulations to design new products and optimize shop floor operations, and AI data analytics to control costs and manage supply chains more efficiently. Manufacturers are also embedding AI in new, intelligent products. The report shows that 51% of manufacturers already use AI in their operations, with 61% expecting investment in AI will increase by 2027. By 2030, 80% say AI will be essential to growing or maintaining their business.

The report also illustrates that manufacturers face ongoing barriers to using and scaling AI—indicating data quality and accessibility as the top challenges, with 65% of respondents reporting they lack the right data for AI applications and 62% citing data that is unstructured or poorly formatted. 

“Artificial intelligence isn’t new to manufacturing. For years, manufacturers have been developing and deploying AI-driven technologies—machine vision, digital twins, robotics and more—to make shop floors smarter, supply chains stronger and workplaces safer,” said NAM President and CEO Jay Timmons. “The latest report from the MLC reinforces the need for modernized, agile, pro-manufacturing AI policy solutions, so that manufacturers can continue to innovate on shop floors across America. Manufacturers welcomed President Trump’s early commitment to maintaining and advancing America’s global AI dominance, and we look forward to continuing to champion American AI leadership and manufacturing in America, which starts with adopting a pro-AI regulatory framework and pursuing policies that bolster innovation.”

As manufacturers seek to expand their use of AI and unlock its full potential at scale, the report also highlights areas where manufacturers may face challenges and require additional investment, such as modernizing data architectures, developing a more knowledgeable workforce, building organizational trust and accelerating legacy infrastructure upgrades.

The NAM has proposed a series of policy recommendations for policymakers to drive AI development and adoption in manufacturing:

1. Adopt a pro-AI regulatory approach given the growing number and variety of use cases in AI in manufacturing, which require an optimized regulatory environment.
2. Develop the manufacturing workforce of the AI age by supporting training programs, career and technical education institutions and STEM education and immigration. According to the MLC’s report, 82% of manufacturers cite a lack of AI-ready skills as the top workforce challenge.
3. Advance energy and permitting reform to support AI-related data center growth.
4. Protect personal data by passing a comprehensive privacy law that preempts state laws, provides liability protections that prevent frivolous litigation and adopts a risk-based approach that enables innovation and AI.
5. Support U.S. manufacturing of AI chips by executing funding agreements with chip manufacturers and renewing the Advanced Manufacturing Investment Credit.
6. Incentivize U.S. AI innovation by passing the One Big Beautiful Bill Act that preserves pro-manufacturing tax policies.

“A worldwide competition for AI supremacy is underway, and manufacturers have the opportunity to lead the charge with this game-changing technology,” said MLC Founder, Vice President and Executive Director David R. Brousell. “Fast-moving developments in the technology have turbo-charged interest and adoption of AI in its many forms, intensifying competition. To win, manufacturers in America need a strong ecosystem of partners and support to create new, competitive advantages in all facets of the manufacturing industry, from operations, to supply chains, to the workforce—and in their efforts to innovate for the future.”

Background:

Manufacturers have been at the forefront of developing and implementing cutting-edge AI systems that are transforming shop floors and revolutionizing operations.

In March, the NAM submitted comments to inform the White House’s development of an AI Action Plan, explaining how manufacturers are using AI on the shop floor and in operations, with specific recommendations on rebalancing and right-sizing AI regulations to enhance America’s global AI dominance.

In May 2024, the NAM published “Working Smarter: How Manufacturers Are Using Artificial Intelligence”—a report that explains the ways in which manufacturers are already using AI, making the technology integral to modern manufacturing with manufacturers at the forefront of developing and implementing AI systems.

Most recently, the House-passed reconciliation bill included language to prevent a patchwork of state AI regulations that would impede AI innovation and development, in line with the NAM’s advocacy for workable, flexible national standards.

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs nearly 13 million men and women, contributes $2.93 trillion to the U.S. economy annually and accounts for 53% of private-sector rese arch and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.

Featured Quotes from NAM Board Chair Kathy Wengel and Partners of the MLC’s Future of Manufacturing Project

“AI continues to drive innovation, efficiency and better outcomes for manufacturers across America. From accelerating drug discovery and development to optimizing manufacturing operations, AI enables companies to make smarter, faster and more impactful decisions,” said Kathy Wengel, Executive Vice President and Chief Technical Operations and Risk Officer at Johnson & Johnson and Board Chair at the National Association of Manufacturers (NAM). “Importantly, AI empowers employees at all levels, when we equip them with the knowledge and understanding to help shape the implementation of these new technologies. AI is proving to be an essential partner on the shop floor, and we must continue to ensure manufacturing employees have the skills they need to build the future of our industry.”

“The Manufacturing Leadership Council survey shows that while continuous improvement remains a key performance indicator for AI in manufacturing, more manufacturers are starting to see greater value in automation and prediction moving forward. From identifying improvement opportunities to analyzing how people interact with systems, AI is enhancing workplace safety and amplifying the power of the leaders on the floor to solve problems faster before any potential disruption to operations. With 63% of manufacturers meeting or exceeding their targets with AI, this survey shows that this trend is only expected to grow as companies prepare their factories for the future.” – Tim Buschur, Chief Strategy Officer, Invisible AI

“Smart manufacturing is advancing rapidly as manufacturers invest in AI and emerging technologies to drive efficiency and long-term business value. Rockwell Automation is helping address key challenges, such as workforce gaps and technology readiness, through strategic partnerships that accelerate digital transformation. The broader manufacturing sector can benefit from initiatives like this, which share practical expertise and clear guidance to demystify AI and empower organizations at any stage of digital maturity to adopt advanced technologies with confidence.” – Austin Locke, Global Lead of Data Science and AI at Kalypso, a Rockwell Automation business  

“AI is rapidly becoming central to manufacturing operations, yet nearly a third of survey respondents are unsure who oversees AI governance at their company. To fully realize AI’s potential, organizations can build a stronger foundation by implementing robust governance strategies that go beyond the technology itself—fostering cross-functional collaboration among leadership and frontline teams to ensure that data, systems, and people are equipped to use AI effectively in real-world settings.” – Kris Slozak, Director of Consumer and Industrial Products, West Monroe

“Business leaders are already seeing immediate benefits with the use of AI; however, manufacturers still face challenges around inaccessible data, limited employee skillset to leverage AI effectively, and outdated systems and operations. Companies that invest early in strong data governance, smart integration, and cross-functional collaboration will be better positioned to compete and grow.”  – Prasoon Saxena, Global Co-Lead Products Industries, NTT DATA

“AI is already driving measurable value for manufacturers by enhancing decision-making and transforming critical supply chain operations. To fully unlock its potential at scale, investing in modern data infrastructure, enhancing workforce knowledge and skills, and adopting new processes to embrace new ways of working will be essential to help manufacturers remain competitive now and in the future.”  – Richard Weng, Managing Director, Accenture