woman leaning against a brick wall in a white jacket

A note from our editor, Elizabeth MacBride:

This week, we launch a new reporting project: Deep Dives into Secondary Cities. With support from Armory Square Ventures, we are doing in-depth reporting on entrepreneurship and economic issues that affect cities in Middle America. Our first stop was Pittsburgh. I visited the city in October and found a story about a different kind of manufacturing: cells and robotics, not steel.

In our story about Pittsburgh, we look at the case for new manufacturing, which comprises robotics and biotech and other specialized sectors, and whether it can deliver a big number of high-paying jobs. There are three dynamics at play.

A more realistic view of globalization. The idea of “globalization” was supposed to offer a solution to those high-paying manufacturing jobs lost in the 1980s to automation, but instead worsened the damage, as manufacturing was shipped off to other countries. “Nobody wanted to listen to Ross Perot because he had big ears, but in a lot of ways he was right,” said Gurumurthi Ravishankar, a teaching professor in the Strategy, Entrepreneurship and Operations Division at the Leeds School of Business at the University of Colorado Boulder.

National security concerns. The Biden Administration announced $52.7 billion of funding for the semiconductor chips industry. Intel announced a $20 billion factory in Youngstown, Ohio, and Micron announced it would build a plant and make a $100 billion investment in Syracuse, N.Y. (Biomanufacturing is getting a much smaller federal boost of $2 billion.)

The business case for U.S. manufacturing makes some sense. The balance between labor, capital and equipment is different today, notes Ravishankar. There are new supply chain concerns. There are benefits of manufacturing close to the consumers. Those, combined with the recent emotional fallout from the pandemic and a world that seems less friendly to the ideals of openness, could push manufacturing back to the United States, said Ravishankar. “It’s like this light bulb went off,” he added, “It would be a heck of a lot easier if this were made here.”

It won’t, however, be easy or quick, he said. “Talking about reshoring sounds good. It makes for political theater,” he said. “The practical reality of doing this is hard.”

I also interviewed David Hallal, the CEO of a company, ElevateBio, that is locating a facility to manufacture cells in Pittsburgh’s new Hazelwood Green. The cells are genetically modified to potentially cure disease like multiple sclerosis and cancer.

ElevateBio grows directly from a profound innovation: the sequencing of the human genome in 1990, which is spawning more treatments and thus, more companies, all the time. One of the most important questions is who will share in the economic benefits of the innovation as it unfolds through society. Do the companies stay here, and who reaps what share of the profits? Workers, executives, investors?

This story and others on New Builders Dispatch are made possible by a sponsorship from the Ewing Marion Kauffman Foundation. The Ewing Marion Kauffman Foundation is a private, nonpartisan foundation that provides access to opportunities that help people achieve financial stability, upward mobility, and economic prosperity – regardless of race, gender, or geography. The Kansas City, Mo.-based foundation uses its grantmaking, research, programs, and initiatives to support the start and growth of new businesses, a more prepared workforce, and stronger communities. For more information, visit www.kauffman.org and connect with www.twitter.com/kauffmanfdn and www.facebook.com/kauffmanfdn.