The Next Production Revolution

Implications for Governments and Business

image of The Next Production Revolution

This publication examines the opportunities and challenges, for business and government, associated with technologies bringing about the “next production revolution”. These include a variety of digital technologies (e.g. the Internet of Things and advanced robotics), industrial biotechnology, 3D printing, new materials and nanotechnology. Some of these technologies are already used in production, while others will be available in the near future. All are developing rapidly. As these technologies transform the production and the distribution of goods and services, they will have far-reaching consequences for productivity, skills, income distribution, well-being and the environment. The more that governments and firms understand how production could develop in the near future, the better placed they will be to address the risks and reap the benefits.

English Also available in: French

The rise of advanced manufacturing institutes in the United States

In the decade of the 2000s, US manufacturing employment fell by one-third, 64 000 factories closed, manufacturing capital investment and output suffered, and productivity growth dropped. The US had been systematically shifting production abroad, and studies suggested that the decline in its production capability was affecting its innovation capacity, which had long been viewed as the country’s core economic strength. This chapter reviews the origins of the policy response to this dilemma, which came to be called “advanced manufacturing”. The chapter traces the way the foundational concepts were developed in a series of reports; explores how a new innovation system response was developed to strengthen the production system; examines the key new policy mechanism, the manufacturing innovation institutes, which is a complex public-private collaborative model to develop new production technologies and processes, combined with workforce education; and, reviews how the new institutes are working, lessons learned as they have started up, and possible enhancements that could expand their policy reach. These new approaches – an advanced manufacturing programme – if implemented, could play a role in strengthening the US manufacturing sector. They could also play a role in moderating the serious social disruption created by the decline in manufacturing.

English Also available in: French

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