JAPAN, Hong Kong, South Korea, Taiwan and Singapore have embraced INDUSTRY 4.0, the Fourth Industrial Revolution.
China, too, but under a different name, Made in China 2025.
At the heart of INDUSTRY 4.0 is digitisation and artificial intelligence. Success will breed tomorrow’s global economic leaders.
The wild card is the United States. An early adopter of INDUSTRY 4.0, it has the financial muscle, academic skills and consumer resources essential for rapid growth in a new frontier.
Perhaps Donald Trump saw INDUSTRY 4.0 coming when he coined his key campaign slogan, Make America Great Again . . .
THE decade ahead will reshape global manufacturing as demand grows, technology unlocks productivity gains, and companies find growth in new parts of the value chain.
Manufacturing is being reshaped by three major trends: rising demand, the convergence of multiple new technologies, and shifting global value chains.
It could also be a decade in which the United States re-emerges as the manufacturing powerhouse of the future, according to a new paper on manufacturing in the U.S. produced by a McKinsey Global Institute research team.
Although China claimed the mantle as the world’s top manufacturing country in 2010, the United States still ranks second when measured by the dollar value of its annual output and global market share.
In 2015, U.S. value-added in manufacturing reached US$2.2 trillion – more than 2.5 times more than the total recorded by Japan and three times more than that of Germany.
MGI says that, after combining demand projections with an analysis of specific industry trends and historic performance, it finds that the United States could boost annual manufacturing value-added by up to US$530 billion (20 per cent) over current trends by 2025.
MGI estimates the U.S. manufacturing sector would add 2.4 million jobs on top of current trends. Furthermore, it says, the positive effects would ripple into services, resources and other industries that produce upstream inputs for the manufacturing sector.
“We estimate the direct impact of these purchases at US$170 billion in direct value-added and almost one million jobs. Adding together the manufacturing and upstream effects, the total potential benefit to the economy could be US$700 billion and roughly 3.3 million new jobs.”
McKinsey says there is no denying that U.S. manufacturing has been through two rocky decades, absorbing losses that have taken a toll on workers, communities and the nation’s optimism.