Report offers strategies for plugging state into growing $1.4 trillion advanced energy sector
With targeted investments and forward-looking policies, Oregon could build on its advantages in the next-generation manufacturing industry to increase economic growth and support an average of more than 65,000 jobs annually. That’s according to The Oregon Jobs Project: A Guide to Creating Jobs in Next-Generation Manufacturing, a new report by the American Jobs Project in partnership with Oregon State University’s Advantage Accelerator and the Green Energy Institute at Lewis & Clark Law School.
“An average of 30 percent of the energy used in commercial and industrial buildings in the U.S. is wasted, and next-generation manufacturing can address that problem and boost businesses’ bottom lines,” said Melissa Powers, Professor and Director of the Green Energy Institute at Lewis & Clark Law School. “Next-generation manufacturing can bring about energy savings up and down the manufacturing supply chain, and demand for it is surging as energy-intensive industries become more efficient. This report offers a practical roadmap for capitalizing on these opportunities to create good-paying jobs by making and exporting next-generation manufacturing products.”
Next-generation manufacturing (NGM) products include technologies and tools built on the integration of information technology and operational machinery. They enable manufacturers to become more energy-efficient through reduced waste and improved productivity and can reduce costs and time to market. Two examples are 3D printers, which can produce parts with less input material than traditional methods; and Industrial Internet of Things devices and software, which optimize production through frequent and instantaneous communication among a manufacturer’s production facilities, transportation system, and software networks.
While Oregon’s economy has recovered significantly since the recession, economic growth has disproportionately benefited the state’s wealthiest residents. Middle-wage employment has gained back only about half of the jobs lost during the recession. And the state’s poverty rate and demand for need-based programs are stuck halfway between pre-recession lows and depth-ofthe- recession highs. The need for economic growth that results in good-paying job creation is clear. Growing Oregon’s next-generation manufacturing technology industry represents a promising strategy to meet this need, with manufacturing jobs in Oregon paying an average of $36.21 per hour.
“Taking practical steps to grow businesses in Oregon’s next-generation manufacturing technology industry would put a lot of people to work, helping to rebuild the middle class and reduce economic disparities in the state,” said Kate Ringness, Director of the American Jobs Project and co-author of the report.
Based on extensive research and stakeholder outreach, The Oregon Jobs Project finds that:
- Growth in demand for next-generation manufacturing products is accelerating, with some market segments expected to increase by a factor of nine by 2025.
- With a base of at least 53 next-generation manufacturing hardware and software suppliers, the fourth-highest number of technical workers in the country as a proportion of its total workforce, and a vocal community of energy-efficiency NGOs, Oregon is well positioned to tap into this market growth. These assets are fortified by cutting-edge research institutions such as the Oregon Manufacturing Innovation Center and the Advanced Technology and Manufacturing Institute.
- Oregon’s many semiconductor manufacturers, aerospace manufacturers, and food processors comprise strong potential local markets for Oregon-made next-generation manufacturing technology, and could serve as critical early customers for startups. Building on this base of local activity, Oregon’s next-generation manufacturing enterprises can tap into markets across the country and internationally, capitalizing on surging global demand for NGM technology.
- The next-generation manufacturing industry could support an average of over 65,000 jobs each year through 2030. This figure includes direct jobs from manufacturing and software development, indirect jobs from suppliers, and induced jobs from spending in the local economy.
The report provides state-specific strategies that take advantage of this economic opportunity and build up critical assets for industry growth, including the innovation ecosystem, access to capital, workforce development programs, business recruitment, and local market deployment.
- Expanding the successful Venture Catalyst network to enable statewide entrepreneur resource coordination;
- Increasing funding and access for work-based learning opportunities to build a next-generation manufacturing workforce;
- Increasing access to long-term capital by facilitating private investments by foundations, otherwise known as program-related and mission-related investments, in NGM startups;
- Enacting a tax credit to reward businesses that invest in incumbent worker training; and
- Creating a state-funded next-generation manufacturing showcase program to speed adoption in under-deployed manufacturing industries.
“Our research into Oregon’s next-generation manufacturing cluster shows a robust culture and ecosystem for energy efficiency and manufacturing innovation that the state can leverage to accelerate growth,” said Karl Mundorff, a Director of the Advantage Accelerator at Oregon State University. “The Oregon Jobs Project suggests a number of practical, targeted, and tested approaches to help the state capitalize on these advantages and become a national and global leader in next-generation manufacturing.”