U.S. manufacturing jobs are never coming back.
This is a reality too painful to recognize, but too true to ignore. Michigan, while still the world's largest automotive epicenter, is changing, and the state's leaders, business and political, must make way for an industry with shrinking labor needs and greater emphasis on talent and technology.
On Wednesday, at the Mackinac Policy Conference, those same stakeholders unveiled Planet M -- a clunky name for a meaningful shift in the way this state thinks about itself and its industry.
The initiative is designed to coalesce the state's mobility assets, such as self-driving and connected-car testing facilities, research centers and automotive and tech companies.
"Mobility runs the gamut, from defense to our highway system to our test beds," Steve Arwood, CEO of the Michigan Economic Development Corp. "This is an effort to bring all that together, to say, 'Let's brand all we have for business attraction, retention and talking about our large number of mobility assets in Michigan.' "
The 32-acre Mcity testing grounds is designed to simulate urban and suburban roads with a network of controlled intersections, traffic signals, streetlights, sidewalks, construction obstacles and more.
Those assets include 375 automotive research and development centers, 61 of the top 100 auto supplier headquarters, the University Research Corridor, the largest number of auto engineers and patents, the Mcity connected car test site in Ann Arbor and the planned American Center for Mobility in Ypsilanti Township.
Michigan is still home to 25 percent of all U.S. assembly plants.
But that's a fleeting reality. More and more production is leaving the U.S. Global economics -- strong U.S. dollar, cheap labor in places like Mexico, and floundering growth in China and Europe -- have put downward pressure on manufacturing employment since rocketing out of the Great Recession in 2010.
Couple that with the rapid expansion of free trade -- a good thing for the global economy, less than good locally -- and we've been bled of jobs. Since former President Bill Clinton signed the North American Free Trade Agreement in 2004, the U.S. has lost 4.5 million manufacturing jobs, with a healthy portion in Michigan contributing to that total.
Leaders, national and local, have pulled out all the stops to prevent the avalanche, and it's not working. Note that President Barack Obama promised to create 1 million manufacturing jobs during his second term. He's about 690,000 jobs short of that goal.
Economies are intrinsically linked and intercontinental, but there are winners and losers.
Mexico continues to claim its share of manufacturing might. The country now handles nearly 20 percent of all North American automotive production, according to data from IHS Automotive Inc. By 2025, that figure will rise to more than 25 percent, while the U.S. will continue its slide from more than 72 percent of North American production in 2000 to 66 percent by 2020.
Furthermore, Mexico beat out Michigan, and the rest of the U.S., by claiming 10 of the 12 new assembly plants built or to be built since 2011.
Sure, Michigan gets a manufacturing win here or there -- including the May 24 announcement that Flex-N-Gate Corp. would build a $95 million plant in the city of Detroit.
But that's just one step forward for every two steps back. Any economist will tell you: Chasing manufacturing jobs is a losing, and foolish, battle.
That isn't to say economic development agencies should abandon all attraction efforts for traditional manufacturing. But it must be tempered. The massive debt caused by the unchecked and loose rules of the Michigan Economic Growth Authority tax credits from the Engler and Granholm eras still plague the state's bottom line.
Van Buren Township is still in a legal battle with its largest corporate resident Visteon Corp. over looming bond shortfalls to build the auto supplier's headquarters.
Economic development has a price.
So let us ensure that the use of tax dollars for economic development are firmly cemented in the future, not holding on to nostalgia of jobs gone by.
Instead, we, as a state, must focus our efforts on building what's next, the specialized automotive manufacturing, r&d and innovation that's growing. We must define it. We must own it. Advanced automotive must be part of Michigan's story -- the one that's being written right now.