The state of manufacturing in the United States is strong. In 2018, tax reform and an improved regulatory environment helped to propel faster growth, with manufacturers raising wages, investing in their operations and offering innovative benefits.
But manufacturers such as PPG are increasingly concerned about rising transportation costs and insufficient infrastructure. More than 70 percent of manufacturers do not believe our nation’s infrastructure can meet the competitive needs of a growing economy.
The American Society of Civil Engineers once again graded American infrastructure a “D+.” U.S. roads and bridges are clogged with traffic, and in many cases, they are in serious disrepair. According to the U.S. Department of Transportation, 65 percent of major U.S. roads are rated as “less than good condition.”
That takes a toll on manufacturers’ bottom lines, causing unreliable delivery times and increased fleet maintenance costs. Congested highway networks add $74.5 billion to transportation costs for manufacturers moving goods and raw materials by truck, according to the American Transportation Research Institute.
Beyond the economic costs, failing to address deteriorating roads is also a serious safety concern.
One of America’s greatest strengths is its ability to create diverse networks of transportation infrastructure, enabling Americans to move goods and services efficiently around the nation. To gain a competitive advantage, other nations are making historic investments in their own transportation infrastructure.
Each year, the World Economic Forum includes infrastructure as one of its key measures of economic competitiveness. For 2017–2018, the United States ranked behind many of our biggest global competitors at ninth in overall infrastructure quality.
Manufacturers continue to rely on outdated roads, bridges, waterways, ports, runways and drinking water and wastewater systems, many of which are more than 50 years old. Our global competitors are making strategic decisions to invest in their futures.
China’s infrastructure investment is almost double the size of the infrastructure spending in the U.S., and India’s infrastructure investments are growing at a rate that triples the infrastructure outlays of the U.S., Canada and Mexico combined.
Critical infrastructure funding to repair and modernize our bridges, roads and aging transit systems must continue to move forward and will help manufacturers in the United States compete and win in the global economy.
The National Association of Manufacturers has provided our leaders with a bold plan, “Building to Win,” that outlines not only the challenges but also the solutions and ways to pay for them. We must continue to work with our leaders to ensure they are committed to improving our infrastructure and remaining globally competitive.
Governance improvements, such as expedited environmental reviews and an independent commission to evaluate priorities and revenue options, are also critical to the success of any infrastructure effort. An infrastructure bill should address neglected projects that make a system-wide difference and improve manufacturers’ supply chains.
Our deteriorating national infrastructure is not solely a state or federal issue. It is not a small or large business issue. It is not a Democratic or a Republican issue. Infrastructure is an American issue that directly affects our ability to compete in the global marketplace and provide financial security for millions of American families.
Now is the time for our elected leaders to work together in a bipartisan manner to act and move much needed infrastructure legislation into the fast lane.
Michael McGarry is chairman and CEO of PPG. Jay Timmons is the president and CEO of the National Association of Manufacturers.