Small Manufacturing Companies in the USA
The New York Times recently ran a story about how Small Factories Emerge as a Weapon in the Fight Against Poverty. Their story centered on urban manufacturing. I live in upstate New York where there are lots of small manufacturing companies scattered across rural communities. Small manufacturers who exist in inner city neighborhoods or small rural towns are a critical part of the employment opportunities for those living near them.
The statistics regarding the value of small businesses to the US economy are pretty well known. In summary, the Small Business Administration has published that small businesses represent more than 99.7% of all employers, employ nearly half of all private-sector workers and provide nearly half of the US private payroll. What is less known is that 39% of workers in high-tech jobs are in small businesses and one quarter of US manufacturing sales are provided by small business.
It is well known, and often discussed that the decline in available manufacturing jobs caused primarily by exporting them to other countries has led to lower paying jobs, accelerated increases in poverty and contributed to the disintegration of the family. Manufacturing jobs pay more than service sector jobs and on average are longer term, have better benefits and more opportunity for advancement.
According to the Bureau of Labor Statistics, manufacturing workers on average earn over $26 an hour. In today’s economy service sector jobs pay much less. There is a growing demand for nurses, nurse’s aides and other medical support staff. But medical orderlies and nurse’s assistants earn half as much. In New York State, with new legislation, a fast food worker will out earn a nurse’s aide with the new fifteen-dollar minimum wage. On average, however, fast food workers nationally have a median hourly wage of $9.11.
The future of the US economy really does rest in our ability to find a way to bring back manufacturing jobs. Well thought-out and restructured tax plans could reverse the trend of the flight of mega-corporations to foreign countries. And this should be a priority. But at the same time the growth and revitalization of small manufacturing companies is critical as well. We need to find ways to innovate, fund and support small manufacturing. In Monroe County we have a number of high tech incubators to assist in this effort. They provide technical and business advise along with grants and subsidized business services. The City of Rochester has an Office of Innovation focusing on helping urban business startups. While many are lower-capital, service-based businesses, there is also opportunity for manufacturing businesses. Of course one of the best known, and most highly publicized and subsidized are the physical plant options available in Eastman Business Park. Whether in Eastman Business Park or elsewhere, there is often assistance available from both private and government organizations. The Small Business Administration being perhaps the strongest proponent. National Grid has a program in place to fund up to 50 percent of improvements in manufacturing that increase productivity. A private organization website called profitableventure.com publishes and shares many good guidelines and aids. One of these is a publication titled “50 Small Scale Manufacturing Business Ideas That Cost Little to Start.”
Small manufacturing businesses often need help in building out their physical plants and infrastructure to get started. At Optimation Technology, our passion it to bring manufacturing back to the USA. We have supported many small manufacturing companies over the years and have built many small manufacturing lines and scaled up many ideas from pilot plant to production scale. We are always looking for new opportunities to make this happen. It’s in all of our best interests to see manufacturing flourish.