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July 2010
© Anderson Economic Group, LLC 2010Permission for reproduction granted with proper citation.
Anderson Economic Group, LLC
1555 Watertower Place, Suite 100East Lansing, Michigan 48823Tel: (517) 333-6984Fax: (517) 333-7058http://www.AndersonEconomicGroup.com
The University Research Corridors Support for Advanced Manufacturing in Michigan
Commissioned by the University Research Corridor:Michigan State UniversityUniversity of MichiganWayne State UniversityPrepared by:Caroline M. Sallee, ConsultantErin Agemy, AnalystAlex L. Rosaen, ConsultantForeword by:Patrick L. Anderson, Principal & CEO
Table of Contents
Anderson Economic Group,
LLC
TOC - 1
Purpose of Michigans University Research Corridor ...............................1URC Special Topic Reports .......................................................................1Overview of Report and Methodology ......................................................1Key Findings ..............................................................................................2URC Annual Economic Impact Reports ....................................................7About Anderson Economic Group ............................................................7
Advanced Manufacturing Definition .........................................................8Advanced Manufacturings Place in Michigan .......................................10Employment and Payroll in Advanced Manufacturing ...........................11Comparison with Midwest and U.S. ........................................................13Advanced Manufacturing Industry Clusters ............................................17Industry Trends Since 2007 .....................................................................23
URC R&D Expenditures on Advanced Manufacturing ..........................25Product Development Lifecycle ..............................................................25URC Contributions to Development of New Ideas .................................26URC Contributions to Design and Testing of Products & Processes ......29URC Contributions to Improving Business Operations ..........................32The URC Partners with Industry .............................................................35URC R&D Has Led to New Companies in Advanced Manufacturing ...37URC is Educating the Next Leaders in Advanced Manufacturing ..........39
Table A-1. Industries Included in URC Definitionof Advanced Manufacturing........................................................................A- 5Table A-2. Productivity of ManufacturingIndustries Sectors, 2008...............................................................................A- 6Table A-3. Increase in Productivity of ManufacturingSectors in Michigan, 2003-2008..................................................................A- 7
Table B-1. Employment & Payroll in Michigans AdvancedManufacturing Industries.............................................................................B- 2Table B-2. Advanced Manufacturing Payroll in Michigan,Midwest, and United States, 2007...............................................................B- 3Table B-3. Advanced Manufacturing Payroll in Michigan,Midwest, and United States, 2003...............................................................B- 4Table B-4. Advanced Manufacturing Employment in Michigan,Midwest, and United States, 2007...............................................................B- 5Table B-5. Advanced Manufacturing Employment in Michigan,Midwest, and United States, 2003...............................................................B- 6
Anderson Economic Group, LLCi
Foreword
Manufacturing is embedded in our states history, and in our national conscious-ness, as the engine of economic growth for much of the 20th century. Michiganwas the arsenal of democracy in World War II, where Henry Fords revolu-tionary wages brought immigrants from numerous countries, and where compa-nies like General Motors, Chrysler, and Ford grew into global enterprises.Michigan is also the place that, far too often, is saddled with a reputation for being very good at something that is no longer relevant, modern, or particularlyuseful in the 21st century. In particular, we suffer from the misguided notionthat manufacturing is not a high tech or high-value-added enterprise. Thisreport provides, in great detail, hard evidence that manufacturing is alive andvital in Michigan today, and that much of the manufacturing done in Michigantoday is high-tech, high-productivity advanced manufacturing.Indeed, there are numerous places in the world where low-tech manufacturingcan take place, often where labor and other costs are much lower than in theUnited States. Manufacturers in Michigan, therefore, must produce high-quality products using high-productivity techniques, and advanced technologies. As wenote in this report, advanced manufacturing in Michigan is:
An
important
industry that employs over 10% of the states workforce;
A
productive
industry where over half of the employment is in firms whose pro-ductivity is growing faster than the average U.S. manufacturing firm;
A
highly-skilled
industry where over one-third of the research and testing jobsin the Midwest are located.
The University Research Corridor in Michigan plays a vital role in supportingthis cornerstone of the Michigan economy. As documented in this report, Mich-igan State University, the University of Michigan, and Wayne State Universityexpend large amounts each year on R&D focused on advanced manufacturing.Furthermore, they train many of the engineers, logistics specialists, scientists,and others that become the key employees of manufacturers and their many sup- pliers and consultants. While the core mission of these universities remains theeducation of tomorrows leaders, it is important to observe how much of theseuniversities efforts today translate directly into benefits for this important sec-tor of our economy.Any state in the country, and indeed any country in this world, would be proudto have the high-tech, high-productivity manufacturing sector that we enjoy inMichigan. As this report documents, the efforts of our research universities willhelp us preserve that advantage in the future.
Patrick L. Anderson
Patrick L. Anderson is the founder of Anderson Economic Group, LLC, an economicconsulting firm headquartered in East Lansing, Michigan.that serves clients across thecountry. He is the author of more than 100 published works, and the executive editor of
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