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America's manufacturing comeback

| Friday, Oct. 24, 2014, 8:57 p.m.

For a generation of young people who live in Greater Pittsburgh today, tales of factory smokestacks and heavy industry dominating the landscape seem like folklore from a bygone era.

The site of U.S. Steel's sprawling Homestead Works now hosts several shopping, entertainment and dining destinations. And Pittsburgh is recognized around the country as a model of post-industrial growth driven by high-tech innovation.

The “City of Champions,” with its wealth of university and corporate R&D talent, is leading the way in advanced manufacturing techniques that are at the heart of America's global leadership in manufacturing.

But that's not the only thing driving a manufacturing comeback in the United States. A steady surge in access to affordable, reliable energy — much of which is produced right here in Pennsylvania's Marcellus shale — is empowering American producers to bring jobs back to the U.S. in droves, reversing the trend of companies choosing to conduct business overseas. In fact, almost half of the large manufacturers in America now have plans to return some production to our country.

Manufacturing is stronger and more productive than at any time in history. It accounts for more than 17 million American jobs. And those jobs pay well: The average salary in the manufacturing sector is more than $77,000. Moreover, manufacturing output has increased by 18 percent since the official end of the recession in 2009. For the first time ever, manufacturing contributes more than $2 trillion to the U.S. economy. That's 12.5 percent of America's GDP, enough to make the U.S. manufacturing sector bigger than the economies of all but seven nations.

Our footing is strong, but without sensible policies in place, these favorable conditions may be fleeting.

Federal regulations, such as the Environmental Protection Agency's latest greenhouse gas emissions standards, threaten to undermine the dynamics that have helped to revive manufacturing.

These standards are unrealistic and guaranteed to disrupt the availability of affordable energy that is so vital to America's manufacturing comeback. They are intended to undermine the use of fossil fuels — both coal and natural gas — as a power source for electricity generation.

Meanwhile, the EPA is less than two months away from piling on yet another regulation, this time a new ozone standard, which, according to a National Association of Manufacturers' study, could be the most expensive regulation in U.S. history. Pennsylvania's economy could take a $194 billion hit alone, costing the average household $2,700 per year.

President Obama has called for a reduction and simplification of federal regulations. But the EPA's recent actions do not match his rhetoric of reform.

Americans need transparent, consistent and fair regulatory policies that will increase innovation, investment and global competitiveness. Otherwise, our nascent manufacturing comeback will be short-lived, and today's growth will be tomorrow's missed opportunity.

Jay Timmons is president and CEO of the National Association of Manufacturers.

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