Seventy Percent of Manufacturers Still Enter Data Manually
Manufacturers are deluged by data. As companies adopt more advanced technologies, they are increasingly overwhelmed by the quantities of raw data that must be collected, analyzed and put to use.
Indeed, a new survey from the Manufacturing Leadership Council—the NAM’s digital transformation arm—reveals that 70% of manufacturers still collect data manually. Here are some highlights from the survey, which reveals where manufacturers need to improve, and how they’re planning to do it.
Exponential data growth: While the survey’s respondents report an explosion of new data, they also expect to keep on top of it over the next few years.
- Forty-four percent of manufacturing leaders have seen at least a doubling of the amount of data they collect in their organization today compared to two years ago.
- While many manufacturers still lack standardized data due to operating a mix of older equipment and systems along with newer technologies, more than half expect that their data will be in a standardized format by 2030.
Analytical improvements: How are manufacturers planning to use all this new data?
- Nearly 60% of respondents say they are focused on understanding their operations with an eye toward optimizing them in the future.
- While 30% of manufacturers say they are using manufacturing data to predict operational performance, another 60% say that predictivity will be a primary objective by 2030.
Better decisions: Manufacturers use data to make better, more proactive decisions, according to the survey. Today, these decisions are made at a relatively high level.
- Seventy-seven percent of respondents said that the responsibility to employ data in decision-making falls to plant leaders and managers.
- Only 33% said that factory floor employees held that responsibility—a percentage that might grow as manufacturers seek to empower frontline employees with greater decision-making ability.
Looking ahead: As artificial intelligence and other emerging digital technologies become more established, they will likely reshape many if not all aspects of manufacturing operations.
- Thanks to advanced sensors and robust data networks connecting equipment and machinery, manufacturers will collect copious data in real time and act on it almost as swiftly.
Read more: To get a deeper look at the current state of data mastery in manufacturing, download the full survey, Data Mastery: A Key to Industrial Competitiveness.
NAM Calls for Oversight on the CPSC
Manufacturers have long been partners of the Consumer Product Safety Commission—working with the agency to keep the public informed and protected—but a lack of transparency at the CPSC in the past few years has stymied businesses’ attempts “to understand how [they] will be regulated,” the NAM told the House Energy and Commerce Subcommittee on Innovation, Data and Commerce ahead of a hearing Tuesday.
What’s going on: The NAM has regularly called for congressional oversight of the CPSC in recent years. Ahead of the “Fiscal Year 2025 Consumer Product Safety Commission Budget” subcommittee hearing, the NAM highlighted several areas of concern for legislators to address:
- Section 6(b) of the Consumer Product Safety Act: “Manufacturers strongly support maintaining the crucial, balanced and effective information disclosure procedures currently mandated in the Consumer Product Safety Act,” said NAM Vice President of Domestic Policy Charles Crain. “Unfortunately, in recent years, the CPSC has attempted to circumvent these standards, releasing statements that lack any scientific data or research or by taking actions without official agency rulemaking.”
- Effective communication of rulemaking and research with regulated businesses: Despite a CPSA requirement that the agency defer to voluntary standards in certain safety-measure compliance cases, “there are recent examples of the agency commencing a proposed rulemaking in an apparent rush to regulate.” The agency has also begun unnecessarily withholding from manufacturers the test reports and analysis they need to create voluntary standards, while giving manufacturers “reduced time … to implement proposed and final rules.”
- Public engagement by CPSC commissioners and staff: “One of the benefits of a small federal agency with multiple commissioners is the availability of commissioners and senior staff to meet with interested parties on relevant topics,” Crain continued. “Unfortunately, in recent years, the CPSC has been less willing to engage in productive conversations with regulated entities.”
The last word: “It is critical that the CPSC effectively communicate and work with manufacturers to ensure that our shared goal of consumer safety is maintained,” said Crain. “The NAM will continue engaging with both the CPSC and Congress to see that the agency is effectively engaging with the manufacturing community.”
The Pass-Through Deduction, Explained
Through the NAM’s recently launched 2025 tax campaign, Manufacturing Wins, manufacturers are calling on Congress to prevent several devastating tax increases from taking effect at the end of next year.
One of those scheduled increases is the expiration of the Section 199A pass-through deduction—a critical incentive, created by tax reform in 2017, designed to help thousands of small and medium-sized manufacturers invest in their businesses.
The NAM recently released a tax explainer on the pass-through deduction, breaking down what it is, what it does and why its preservation is vital to manufacturing in the U.S. Here are the highlights.
Pass-through defined: The defining characteristic of a pass-through entity is that its business profits get “passed through” to the company owners, who then pay taxes on the business’s income on their personal tax returns.
- The vast majority of businesses in America—96%—are organized as pass-throughs, including S-corporations, partnerships, LLCs and sole proprietorships.
- In manufacturing, pass-throughs are typically small, family-owned firms.
What it’s done for manufacturers: The Section 199A pass-through deduction allows pass-through manufacturers to deduct up to 20% of their qualified business income, decreasing their effective tax rate.
- Combined with a lower individual income tax rate included in the 2017 reform (which reduced the top individual rate from 39.6% to 37%), the pass-through deduction has freed up significant capital for smaller manufacturers to reinvest in their businesses.
- For example, 2018 was the best year for manufacturing job creation in 21 years and the best year for wage growth in 15 years.
What’s in jeopardy: Both the pass-through deduction and the lower individual income tax rates are set to expire at the end of 2025—and they’re certain to hit small and medium-sized manufacturers hard.
- In a recent NAM survey, 93% of pass-through manufacturers said their ability to grow, create jobs and invest in their companies will be stymied if the expirations are allowed to happen.
What should be done: Congress must make the pass-through deduction permanent and keep individual tax rates as low as possible.
The last word: “Small and medium-sized pass-throughs are the backbone of the manufacturing supply chain,” said NAM Vice President of Domestic Policy Charles Crain. “Congress must act before the end of 2025 to preserve the pass-through deduction and prevent devastating tax increases on small businesses throughout the manufacturing sector.”
Trump Picks Vance
Freshman Sen. J.D. Vance (R-OH) is Republican presidential nominee Donald Trump’s vice presidential pick, Trump announced Monday at the first day of the Republican National Convention (The Wall Street Journal, subscription).
The backdrop: “The pick comes amid widespread calls for unity following the assassination attempt at Trump’s rally in Pennsylvania on Saturday, when a gunman opened fire on the crowd. Trump said he suffered a gunshot wound to his ear. One rallygoer was killed and two others were critically wounded. The gunman was fatally shot by a Secret Service sniper.”
- NAM President and CEO Jay Timmons called for a renunciation of violence following the shooting. “Violence should never be the answer and must be clearly condemned, along with those who would foment it,” he said. “In America, we resolve our differences through our votes, not violence. … [A]ll Americans should commit ourselves to the peaceful expression of our ideas and our politics and to the protection of our democracy.”
Why it’s important: Vance—a former Marine and Yale Law School graduate who gained national fame with his 2016 memoir, “Hillbilly Elegy”—is expected to “be strongly focused on the people he fought so brilliantly for, the American [w]orkers and [f]armers in Pennsylvania, Michigan, Wisconsin, Ohio, Minnesota and far beyond,” Trump wrote in a social post on Monday, according to the Journal.
On the record: Timmons, who shares Ohio roots with Vance, said on Monday the vice presidential pick “understands the transformative power of manufacturing to improve the quality of life for everyone.” Vance previously shared what Timmons called his “powerful personal story” with the NAM Board of Directors.
- Vance “recognizes the role manufacturing plays in building strong communities and an exceptional nation, and he is committed to supporting the growth of our industry,” Timmons said. “The NAM is committed to working with all candidates to shape the manufacturing strategy in the next administration and advance the NAM’s ‘Competing to Win’ policy agenda for growing manufacturing in the U.S.”
Consumer Prices Inch Down
U.S. consumer prices declined unexpectedly in June, the second straight month of “tame” readings (Reuters, subscription).
What’s going on: “The consumer price index dipped 0.1% last month after being unchanged in May, the Labor Department’s Bureau of Labor Statistics said on Thursday.”
- In the 12 months through June, the CPI rose 3.0% following a 3.3% increase in May.
- Reuters-polled economists had forecast a 0.1% rise for the month and a 3.1% year-on-year gain.
The big picture: “The annual increase in consumer prices has slowed from a peak of 9.1% in June 2022. The CPI is running far ahead of the measures tracked by the Fed for its 2% inflation target. The Personal Consumption Expenditures (PCE) price indexes both increased 2.6% in May.”
However … The report follows news last week that the unemployment rate rose to a two-and-a-half year high.
- And economic growth has slowed in response to the Federal Reserve’s interest rate hikes in 2022 and 2023.
- Fed Chair Jerome Powell told Congress this week that more data is still needed to declare “inflation beaten.”
What it means: Still, the CPI report is “reinforcing views that the disinflation trend was back on track and drawing the Federal Reserve another step closer to cutting interest rates.”
Emerson Finds Energy in Sustainability
When Emerson’s first-ever Chief Sustainability Officer Mike Train talks about his company, his enthusiasm shines through.
- “What we do to enable our customers is huge,” said Train. “We have an important role to play—and I get a lot of energy out of that.”
An aggressive push: The technology and engineering company, headquartered in St. Louis, Missouri, has been making big moves in sustainability over the past few years—beginning with a goal in 2018 to reduce some of its greenhouse gas intensity by 20% over 10 years.
- At the time, the goal was ambitious, and the company wasn’t quite sure how it would achieve it. But employees banded together and pulled it off.
- “We actually achieved the goal in 2022—six years early,” said Train. “But the act of putting out a goal and not knowing exactly how we’d solve for it … has been driving the culture of our company. Our employees are proud we put it out there, proud to have participated, and it’s activated thousands of people to get excited about what we’re doing.”
An inclusive approach: Since then, the company has applied a range of tactics. From “energy treasure hunts,” in which teams search for energy waste in facilities, to renewable energy procurement and collaborations with supply chain partners, Emerson is finding interesting and inclusive ways to make an impact.
- The company has gone from getting 3% of its power from renewables to getting to 49% from those sources. And it now has a commitment to use 100% renewable energy by 2030.
- Emerson is setting other big goals, too, from net-zero operations by 2030 to a zero-waste-to-landfill pledge, along with other water and biodiversity actions.
An effective framework: The company has a three-part approach to its sustainability practices.
- Greening Of Emerson involves the actions Emerson is taking to reduce its own footprint by minimizing waste and engaging its supply chain.
- Greening By Emerson involves the company’s activities to help a wide range of manufacturing customers improve their own sustainability, often through Emerson’s automation portfolio and expertise. This, according to Train, is where Emerson has its biggest opportunity for impact.
- Greening With Emerson refers to the company’s work with government and research organizations on policy and innovation, offering technical expertise and manufacturing perspective to help drive action.
A group effort: Train has seen the company coalesce around these goals—from the sustainability team he works with every day (“they bring a lot of energy and passion to what we’re doing”) to the rest of the company’s 74,000-person workforce.
- “The fun part of sustainability is everyone is learning it together,” Train continued. “You’re allowed and encouraged to borrow ideas from each other, so the collaborative part of sustainability is an awful lot of fun.”
Energy Tax Credits to Be Expanded
Federal tax credits that have long been available for solar and wind energy projects may soon also be available for other renewables initiatives, such as nuclear fission and fusion (Reuters, subscription).
What’s going on: On Wednesday, “[t]he Treasury Department announced its guidance for Clean Electricity Production Credits and Clean Electricity Investment Credits, created under the 2022 Inflation Reduction Act, that will be available in 2025 as the previously available wind and solar production and investment tax credits sunset.”
- The Biden administration’s proposal identifies several technologies that will be eligible for the credits, including nuclear fission and fusion, marine and hydrokinetic energy, hydropower and geothermal.
- Public comments on the proposal will be accepted through Aug. 2, and a public hearing is scheduled for Aug. 12 and 13 (Law360, subscription).
The NAM says: “Expanded eligibility for these tax credits is a key to getting more industries involved,” said NAM Director of Energy and Resources Policy Michael Davin.
Russia’s Targeting of Ukrainian Energy Infrastructure Shows Need to Lift Ban
Russia’s missile attack on Ukraine last Saturday hit vital energy infrastructure, underscoring the need for the Biden administration to lift its more than three-month-old ban on U.S. liquefied natural gas export permits.
What’s going on: “The [missile] attack targeted ‘the power grid and the gas transit system, particularly the gas infrastructure that ensures the security of deliveries to the EU,’” Ukrainian President Volodymyr Zelenskyy said (POLITICO Pro, subscription).
- “Russia has intensified its assaults against Ukrainian power stations in recent weeks, and its missiles are now also hitting gas storage facilities that were used by some EU companies last winter to prevent energy shortages.”
- The strikes also hit four thermal plants in Ukraine and injured a worker.
Why it’s important: “With Russia targeting energy supplies in Europe, it is critical that we lift the ban on LNG exports so the United States can fill any unexpected gaps,” said NAM Director of Energy and Resources Policy Michael Davin. “Lifting the moratorium is a national and energy security issue.”
What Americans want: People in the U.S. overwhelmingly support natural gas exports, a recent NAM poll found, with 87% of respondents saying the U.S. should continue to export the energy source.
EPA Chemical Rule Will Add Delays, Costs for Manufacturers
The EPA recently finalized a rule that establishes a process for conducting risk evaluations for certain chemicals—but it will only hamstring U.S. manufacturing competitiveness if implemented, the NAM said this week.
What’s going on: In a final rule issued late last month under the Toxic Substances Control Act, the EPA “will now consider exposure to chemicals in air and water and, when possible, combined risks from exposure to multiple chemicals” (Chemical & Engineering News).
- “The [agency] will also consider risks to workers without assuming that they are wearing personal protective equipment [and] … chemical uses required for national security or critical infrastructure.”
Why it’s important: The final regulation will unnecessarily cost manufacturers in both time and money.
- The “new TSCA risk evaluation rule adds too many additional barriers and requirements on manufacturers and risks creating de facto bans on chemistries essential to both existing technologies and the development of new innovative materials,” the NAM said Monday.
- “Manufacturing relies heavily on new and existing chemicals, which are the building blocks of technologies that make modern life possible,” NAM Vice President of Domestic Policy Brandon Farris told the agency last December. “To ensure continued access to the newest chemicals which can make essential technologies even more effective and efficient, TSCA should be administered in a manner that protects health and the environment while avoiding unnecessary adverse economic impacts on business enterprises.”
What should be done: The agency should revise the final rule, the NAM said.
NAM Stands Up for Biopharmaceutical Innovation Before Senate Hearing
In advance of a Senate hearing on health care costs, the NAM is ensuring that senators understand the importance of biopharmaceutical innovation to patients and the U.S. economy—and the damaging impact of policies that hinder drug development.
What’s happening: The Senate Armed Services Committee will hold a subcommittee hearing today on whether harmful policies like price controls, compulsory licensing and weaker intellectual property protections for new medicines could reduce servicemembers’ health care costs.
NAM pushes back: The NAM is highlighting the extraordinary investment—in both time and capital—that it takes to bring a lifesaving treatment to market. According to the NAM:
- The average cost of developing a new drug was $2.3 billion as of 2022;
- Across the industry, biopharmaceutical manufacturers spent $139 billion on R&D in just 2022 alone;
- It can take 10 to 15 years for a breakthrough scientific discovery to move through early-stage research, clinical trials, Food and Drug Administration approval and manufacturing; and
- Only 12% of investigational drugs that enter a Phase I clinical trial ultimately receive FDA approval—to say nothing of the hundreds of discoveries that never make it into clinical trials.
Lifesaving impact: In 2023, the FDA approved a record-breaking 71 new medicines that will improve the lives of patients.
- The biopharmaceutical industry behind these breakthroughs is also stimulating the U.S. economy: Biopharmaceutical manufacturers accounted for $355 billion in value-added output to the U.S. economy in 2021 and directly employed 291,000 workers in the U.S.
Innovation under threat: In recent years, biopharmaceutical manufacturers have been subject to harmful policies that will limit innovation and slow efforts to develop lifesaving medicines.
Read the full story here.