Exploring Careers in Manufacturing
Part 1 (1:24–3:13)
Why does the Federal Reserve care about careers in manufacturing?
Part 2 (3:14–8:32)
What percentage of U.S. employment does manufacturing account for?
Part 3 (8:33–10:17)
How does the unemployment rate in the Southeast stack up against the national unemployment rate?
Part 4 (10:18–13:00)
What role does manufacturing play in the Southeast economy?
Part 5 (13:01–14:46)
What are some myths surrounding a career in manufacturing?
Part 6 (14:47–17:24)
How do we forecast growth in the manufacturing industry?
Part 7 (17:25–23:10)
What is the biggest challenge faced by manufacturing employers?
Part 8 (23:11–30:05)
What are manufacturers looking for in an employee?
Part 9 (30:06–40:27)
What free resources are available to teach about gross domestic product or GDP?
Part 10 (40:28–49:48)
Questions and Answers
Denise Davis: Hello and welcome to today's Maximum Employment Matters webinar. Our discussion for today focuses on careers in manufacturing. I'm Denise Davis from the St. Louis Fed and I'll be facilitating today's call. Before we get started, allow me to cover the call logistics. Please join me on slide two. If you haven't already done so yet, click on the webinar link you received after registering. This option offers a few benefits. You can watch the slides as they're advanced. You can type questions to us, download the session materials, or even choose to listen to the audio through your PC speakers.
Please note that the webinar performance is dependent upon your connection, so if at any time you're having problems, just pick up the phone and dial the toll-free number. To ask questions today, you can submit them at any time by clicking on the "Ask Question" button in the webinar tool. Please be sure to keep your mouse handy throughout the webinar, as we'll be asking you to participate in some polling questions later on.
One additional note, the views expressed in this presentation are those of the presenters and not the official opinions of, nor binding on, the Federal Reserve Bank of Atlanta nor the Federal Reserve System. Now, with all of that out of the way, I'd like to turn the call over to our host for this program, Julie Kornegay, from the Federal Reserve Bank of Atlanta.
Julie Kornegay: Thanks, Denise. I'm Julie Kornegay with the Birmingham Branch of the Federal Reserve Bank of Atlanta, and I'd like to welcome you to today's program. We have an outstanding lineup of presenters, also from the Atlanta Fed. Allow me to introduce Troy Balthrop and Lesley Mace. And, we are excited to have our industry expert Mike Stockard with Elwood Staffing with us, also. Next slide, please.
Before we get started I wanted to provide a brief overview about how this webinar series came about and about the Federal Reserve programs. Oftentimes when we are recruiting speakers or promoting programs, we get questions like, why is the Federal Reserve hosting a webinar on careers in manufacturing? These types of programs are at the core of the Fed's mission. The Federal Reserve has a dual mandate of price stability and maximum employment. Next slide.
By offering these programs, we hope to inform the audience of industry trends that will lead to an increase in human capital. This information can be used in education and training to produce more skilled labor. A skilled labor force attracts new industry, which brings with it high-paying jobs, which produces more spending and tax dollars, ultimately increasing our standard of living. Next slide, please.
Our program today will focus on the areas within the Atlanta Fed, or what we like to call the Sixth District. As you see on the map, our District represents most of what we consider to be the Southeast. The Federal Reserve offers educational outreach programs that are economic and personal finance oriented. Later in the presentation, Lesley Mace will discuss some of our free resources that are available on our website. Next slide.
Now that you know a little more about our education outreach programs and why we're hosting the webinar, I'm excited to introduce our first speaker. Troy Balthrop has been with the Nashville Branch of the Federal Reserve Bank of Atlanta for 17 years. In his role as senior analyst in the research department, Troy gathers and analyzes real-time anecdotal data about the economy in middle and east Tennessee, which feeds into the Bank's monetary policy recommendations. Troy works closely with the Bank's director of research in providing presentation content similar to what you'll see in today's presentation, and is the bank's go-to expert on manufacturing and production activity in the Southeast.
Troy, thank you for joining us today.
Troy Balthrop: Thanks, Julie. I want to say hello to everyone, and thank you for joining the call. If you could go onto the next slide, please. I'm going to give you a brief overview of the manufacturing industry and, in particular, the manufacturing industry in the Southeast, which is represented by the Sixth District of the Federal Research System. On this slide you see a map of the Sixth District and the geographic area that we cover. I'd like to point out that the six states of the Sixth District together represent about 13 percent of the national economy. And the industrial and employment composition of our region generally resembles that of the total U.S., so we are a good proxy for the nation as whole.
Before moving on to slide nine, I believe we have a polling question, Denise, is that correct?
Davis: Yes, that's right. So everybody get your mouse handy. You should see a question pop up on your screen here in just a moment. And go ahead and make your selection while I read it out loud. What percentage of U.S. employment does manufacturing account for? a) 5 percent; b) 8 percent; c) 11 percent; or, d) 14 percent. So go ahead and make your selection. And I'm going to go ahead and stop the poll, and I'm going to show the results. They should be popping up here in just a moment. All right. It looks like 17 percent say 8 percent; 37 percent say 11 percent; and 47 percent say 14 percent. All right, Troy, back to you.
Balthrop: OK. Well, if we could move on to slide nine. This slide shows you the percentage of each sector and what percentage of U.S. payrolls make up that sector. As you can see by the separated section of the pie chart on slide nine, the answer is 8 percent. The percentage of manufacturing jobs in the U.S. workforce has fallen significantly over the last 35 years or so, which actually leads me to slide 10, please.
Now, this chart shows you the increase in overall payrolls in the U.S. since 1950. It also shows you the rise and decline of manufacturing payrolls during that time frame. The blue line represents the amount of overall jobs in the U.S., which you can see has grown from about 43 million in 1950 to over 145 million in 2016. The orange line represents manufacturing payrolls, which peaked in 1979 at over 19 million, but has fallen since that time to a little over 12 million. In the 1950s, about one in three payroll jobs was in manufacturing. Today that number is less than one in 10. The U.S. manufacturing industry lost close to 8 million jobs between 1979 and 2010.
Notice in the chart, it has increased slightly since 2010, but a lot of that rebound is due to factories hiring back staff after the Great Recession. Not a lot of organic growth there. So moving onto slide 11.
Please understand that the unemployment data that I showed you on the previous slide—you hear a lot about this data on the news. The amount of jobs added each month and the unemployment rate are calculated using two different surveys, and I really want to point this out today. A few facts about the Payroll Survey, which the data on the previous slide came from. The folks at the Bureau of Labor Statistics (BLS) contact about 146,000 businesses and government agencies, and they report how many jobs they added or lost. And that is where the number of jobs added or lost each month come from that you hear reported on the news.
I put a web link at the bottom of this slide that will take you directly to the info about the survey. And I do suggest you visit that link. The BLS has a lot of great data and a lot of good info about how they conduct this survey. I do want to point out, we got a brand-new employment report last Friday, and you might have caught it on the news on Friday, but the U.S. economy added 227,000 new jobs on net during the month of January, so that's a good number. If we could move onto slide 12.
Now this slide shows you the unemployment rate for the U.S. and the Sixth District states. As you can see, they run pretty close to one another. However, at the end of December, the Sixth District rate was slightly higher at 5.2 percent than the U.S. rate, which was at 4.7 percent. But the main thing I want you to notice about this chart is how the Sixth District unemployment rate and the U.S. rate kind of parallel one another. They run together. So again, we got a new employment report on Friday, and the unemployment rate for January was 4.8 percent. So it ticked up just a little bit compared to December. So moving onto slide 13.
The previous slide I showed you, that was the unemployment rate, which is a different survey than the Payroll Survey. I want to give you a few facts about the Household Survey, which is where the unemployment rate comes from. Now, like the Payroll Survey, it is administered by telephone. But unlike the Payroll Survey, households are contacted instead of businesses. The BLS contacts roughly 60,000 households and asks them a series of questions concerning their employment status. The information gathered is being used to determine the size of the labor force, the unemployment rate, and various other employment statistics.
I have also included an example on this slide depicting how the unemployment rate for December was calculated. Once again I have included web links, and you can find all this information by visiting the BLS website. Moving on to slide 14.
I want to point out how important manufacturing's role is in the Southeast. We have a very diverse group of manufacturing industries here. The one that gets the most attention is obviously the automotive industry, and for good reason. Not only are there several automotive manufacturing plants in the Southeast, which I've listed on this slide, but there are tons and tons of automotive suppliers located in the Southeast as well. Most of your automotive manufacturers want their suppliers located in somewhat of a regional vicinity and there are a lot of them in the Southeast located near these manufacturing plants. Moving on to slide 15.
This slide just lists some of the other major manufacturing industries located in the Southeast. As I mentioned, it is rather diverse. We have everything from ship building to carpet manufacturing to poultry processing and soft drink manufacturing. I think everyone knows that Coca-Cola is headquartered in Georgia. So even something as, you know, making soft drinks is actually considered manufacturing. So, moving on to slide 16.
I want to talk to you for a moment about some of the factors that are changing the manufacturing industry. The most obvious would be advancements in technology. Automation is creating an environment where products can be built more efficiently and with less people. But technology requires workers to have a strong skill set. It requires the workers to be technologically savvy, technologically nimble.
The global environment is another factor. It's constantly changing and evolving. And we live in a global economy now, and changes overseas often affect what goes on in the U.S. and vice versa. Labor shortages and demographics are playing a part in the industry going forward. A study in 2015 by the Manufacturing Institute suggested that U.S. manufacturing will face a 2 million worker shortage over the next 10 years, and that's significant. A lot of that shortage will be due to baby boomers retiring and too few young people being interested in a manufacturing career. Skills mismatches—a lot of workforce today simply lack the skills for the jobs that are open. The presenter following me will also talk about this. Moving onto slide 17.
If you've got students that are considering a career in manufacturing, I just want to touch on this. Again, Mr. Stockard will talk about this and get more in the weeds and some of the details with this, but for those of you who have students considering a career in manufacturing, some of the things to consider are, many of the jobs do not require a college degree, but maybe just a one-year certificate. They will be working with cutting-edge technology. It's a lot of advanced manufacturing. Nowadays, the educators and employers are working more closely to develop programs to train people to gain the skills they need to fill jobs.
Nissan, for example, here in my backyard, has built its own training center to help employees learn new skills or maintain the skills they already have. I've also listed a few of the jobs that are expected to need filling. So, moving onto slide 18.
I've listed a few of the manufacturing myths that I hear a lot from people that have disregarded a career in the industry. The perceptions listed on this slide do not match up with most of the plants and environments that I see today. Manufacturing plants now tend to be very clean, well-lit, safe, and with high-skilled jobs that pay well. Now, of course, there are still jobs out there where you have to get your hands dirty, obviously. But it's not that there's just a lot of other jobs out there where that's not required any longer. It's a very advanced environment. Moving on to slide 19.
This graph depicts one of the most well-known indicators from the manufacturing industry. It's called the PMI, which stands for Purchasing Managers Index. It is basically a survey of purchasing managers that work in the manufacturing industry. They answer a series of questions and their answers give a nice snapshot of how the overall industry is doing. The best way to interpret this chart is that any reading above the black, bold 50 line is considered expanding activity. In other words, conditions are considered good. If the line drops below 50, then activity is considered to be contracting, which is, obviously, not good.
As you can see by the chart, especially the red line, which represents national activity, in July 2014 the index started declining until it bottomed out early in 2016. This decline was mostly due to the appreciation of the dollar, but it has rebounded since. So, moving onto slide 20.
This slide will give you a general idea of what is expected for the manufacturing sector in the short term and the long term. Short term, some of the micro data that we see is indicating that activity is picking up, things are getting a little better. The macro data we see, which includes the previous graph I showed you, also suggests the industry is gaining some momentum. Now, not included on the previous graph, we actually got an update for the PMI last Thursday, and it actually had a 56 reading for January, which is its highest reading since November of 2014. So that'll give you an idea of, that, you know, we have gained some momentum.
In the short term we also think the dollar's going to continue to weigh on firms with international exposure. In the long term, demand and export growth are going to continue to be a concern. Of course, demand is always a concern no matter if conditions are good or bad, but it's particularly a concern when conditions are not good. Once again, labor shortages, I touched on that earlier, that's going to continue to be a concern. Moderate capital investment is expected and, just overall growth expectations are, you know, predicted to be rather modest.
So this concludes my portion of the presentation, if I can hand it back over to Julie.
Kornegay: Thanks, Troy. That was really good information. If you have questions for Troy, please click the "Ask Question" button in the lower left-hand section of the webinar window, and we'll do our best to get to as many questions as possible at the end of the program. We are excited to welcome our next speaker, Mike Stockard. Mike serves on the Federal Reserve Bank of Atlanta's Human Capital Advisory Council. He is executive vice president of Elwood Staffing, which is the 18th largest staffing company and the 10th largest industrial staffing company in the United States.
Operating in more than 250 service locations in 31 states, the company employs more than 100,000 temporary associates each year. Mike's 22 years of staffing background and passion for the industry make him the perfect content expert for today's program on careers in manufacturing. Mike, we're delighted to have you. And to kick off your section we have a poll question. Denise?
Davis: All right. It's that time again, grab your mouse. You should see a question popping up on your screen here in just a moment. Go ahead and make your selection while I read it out loud. What do you think is the biggest challenge faced by manufacturing employers? a) Tight labor market; b) High turnover; c) Unskilled labor force; or d) Unwillingness to relocate. So go ahead and finish making your selection. And I'm going to go ahead and stop that poll and show the results. We should see them pop up here in just a moment.
Wow. It looks like 83 percent say C), unskilled labor force, while we have 9 percent tied for high turnover and 9 percent for a tight labor market. All right, let's hand it over to you.
Mike Stockard: This is Mike Stockard with Elwood Staffing. Just to kind of kick off, I just want to maybe give a quick overview of kind of what a company like Elwood Staffing does and the role we would have as it goes with manufacturing. If you look at total U.S. employment, about 2 percent of the overall workforce in the United States are temporary workers. Now that doesn't mean that they're in an assignment that's part-time. It could mean that they're on assignments that may have a start date and an end date, more like contract work or short-term assignments.
But most of the people that we place are going into the positions that are what we call "temp-to-hire" positions. And that, traditionally, means that they may work for a company like Elwood Staffing for three to six months before the company hires them on. The advantage for companies that utilize that service is they have an opportunity to look at those workers before they actually hire them as full-time associates and are able to evaluate the employees, kind of see how they are with attendance, work ethic, things like that. And it's a great opportunity for the people we employ as well, to make sure that the companies they're going to look at are a good fit for them.
And, as you can imagine right now with the labor market being very tight, that's really important, too. We think our associates want to be in an environment that they feel comfortable in, and there's different things that they may look for depending on the type of industry they're in. So as we kind of get to slide 22 right here and talk about adapting to a tight labor market, and a lot of the stuff I'm kind of talking about is probably on a lot of the front-end hiring and what happens through the lens of a staffing company.
We know that right now employers are really trying to find ways to be more flexible and, as you can imagine, with a lot of your students, probably, and the millennial generation, they'll sometimes take less pay for, you know, an extra day off or work on a four-day-a-week schedule. They just want to have quality of life outside of a job. And if you think back, you know, a lot of people were defined by their jobs. I know I feel that way a little bit. I know my parents did. But they're…they want a lifestyle-type job, a job that's going to fit their lifestyle and, you know, that they can make a career out of.
So that's also led to companies having to be a little bit more lenient on how they hire people. And for us that may have meant more leniency on a background check, the time that they have between failing a drug screen, whether or not they have a high school diploma or GED, so there's a lot of things that companies are going to have to look at right now that they may not have accepted two or three years ago just to get the workers they need.
So I talked a little bit about intent to hire. If I was to turn back the clock for us in manufacturing especially, you know, three, four, five years ago, an average associate may work with Elwood Staffing for somewhere around nine to 12 months before they were hired by the company. And that was because companies had a lot more ability to kind of pick and choose who they wanted to hire, and there were more available workers. Well, that's probably cut at least in half for us right now. So when a company sees a good worker and a good employee, they're trying to bring them over to their payroll as quickly as possible.
And then lastly, we definitely see education as a differentiator. And even though I kind of talked about more lenient hiring criteria and not the requirements of having that high school diploma or GED, there's just a lot more opportunity once someone has that in hand, or if they're still pursuing it, companies will look at that and say, "Hey, as long as I can get a GED from you in the next year, that's going to open up the doors that you'll want to grow with this company." If we could go to the next slide.
Looking at some of the labor trends in manufacturing right now, we've just been through a round of kind of our quarterly business reviews with a lot of our largest clients and when I see people kind of fall out that don't make it, we measure turnover very closely and try to figure out why people leave. We measure retention of why people stay. But companies are looking for people that work as teams and really respect their coworkers. Honda's one of our biggest clients in the Southeast. We work with them in Alabama and Georgia, and probably have 3,000 people committed to Honda and some of their suppliers. And having respect for your coworker kind of goes hand-in-hand with working well on teams, so that's a big deal. They do a lot of training as I imagine Nissan—which Troy mentioned earlier—probably has similar type programs. So, mutual respect is a big issue.
Obviously, following directions and an ability to learn new processes, so if you look at the manufacturing industry, companies want people that can actually not just perform one task, but may be able to fill in when someone's out or there's a shortage of workers in another area. So, the last thing on here is just, kind of, compensation trends. We've definitely seen some pretty big increases for temporary workers over the last couple years that are going into manufacturing. And if you just, for educational purposes, if we were to place someone at Honda Manufacturing, they may start there as a full-time Honda associate at $17, $18 an hour and then they're also, obviously, going to have great benefits working for a company like that.
Well, if they work through Elwood Staffing, those people may go on with us for $12 or $13 an hour and it's kind of a…there's kind of a carrot out there for them to go full-time because of the pay and benefits. But it's also an evaluation period for that client. But we've definitely seen pay rates move up, which is kind of good news if you're in high school right now and graduating and not going on past high school. There's definitely some improvement in compensation over the last year or so. Next slide, please.
So, as we look at manufacturing in the Southeast, what I see a lot of because we have offices up in Michigan and Ohio and obviously work with a lot of manufacturing companies in those areas, there are a lot of companies that are relocating to the Southeast. As Troy mentioned earlier, especially in automotive right now, the companies want their suppliers to be closer. Just as an example, and I know this state doesn't fall in this region, but we know for a fact right now that BMW is requiring their suppliers to be within a couple of hours and really closer to an hour depending on what their product is to the BMW facility there. So over the next 18 months, there may be as many as 150 suppliers that would be local to that area.
That trend has definitely been the same in the Southeast, especially between Alabama, Georgia, and Tennessee where there's more suppliers that may have been located in the Northeast that they're wanting these auto companies or wanting those suppliers to be closer, so it's high growth. They're definitely looking for experience. You guys answered that question and I think 83 percent said that they thought the talent shortage was a big issue and that's definitely a big factor. So they're looking for people that they can promote and that can learn, so the pay is great, the manufacturers are willing to pay for talent when they can find it. And there's also a lot of opportunity to move up quickly if you're in…if you have an ability to learn and grow. Next slide.
So, Troy talked a little bit about the unemployment rate, and for us it's a little bit deceptive and that kind of goes along with the skills mismatch right now. Even though there's been lower unemployment rates and if you look, kind of, back prior to 2008–2009, the unemployment rate may have been lower than where it is right now, but the workers just didn't match up to the job. So, a lot of the time not only is it that we don't have the skill sets we're looking for in workers, sometimes people were just overqualified that have worked in lead or management positions and they weren't willing to accept lower pay and a lower job, but companies were kind of hesitant to do that because they don't think people will stick around.
If your students are able to go on and learn a skill or a trade, even from a, you know, as Troy mentioned, one- or two-year college, that's a big leg up once they kind of get themselves into the workforce. Next slide.
And again, Troy talked a little bit about opportunities in manufacturing. Obviously, we've talked about skilled labor, but a lot of these companies have accounting, budgeting, procurement, public relations is a big deal. These companies are out in the community and want to be promoted, and they're doing that to attract and retain good people. Engineers, machinists, robotics, supply chain, IT, there's a little bit of everything. Obviously, the biggest workforce is skilled labor for us. But there's all kinds of opportunities within this company…these companies, next slide, please.
When we think about hiring and education, most companies are looking for a high school diploma or a GED. The client that's big for us right now is Honda. They also look for a year of manufacturing experience. That's not an absolute requirement, but they kind of push to bring people in that have done some manufacturing ahead of time. And just as an example, Honda does not require the high school diploma or GED, but it's hard to move up in that company unless you have that skill set.
Trade schools and colleges around the Southeast have definitely become a lot more popular. I know that our state government in Alabama has done a lot to kind of push to grow trade schools and fund it a lot more than in the past. If that's an option for your students, and they can go past high school, even just to get a little bit more training or learn more of a specialized skill set, that's a huge benefit, too.
We would love to have the opportunity to help any of your students to work with Elwood Staffing. They just have to be 18 years old and, as I said, we work with a lot of people that don't have a high school diploma or GED yet, but we obviously push them to kind of pursue that once they get started with us, even if it's just getting their GED completed. But if anyone's interested, elwoodjobs.com kind of can tell you a little bit more about that. But we're hopeful that maybe we'll hear from some of your students and be able to place them in careers in the future. So, I will hand it back over, thank you so much.
Kornegay: Well, it certainly seems that there are a lot of opportunities in manufacturing. Thank you for sharing your insight. If you have questions for Mike, please click the "Ask Question" button in the lower left-hand section of the webinar window. Our final presentation this afternoon comes from my colleague with the Jacksonville Branch. Lesley Mace is going to take a few moments to highlight some of the resources that are available to help teach today's topic. Take it away, Lesley.
Lesley Mace: Thank you, Julie. So, I'm going to tell you some of the resources that we have for you to use with your students, mainly focusing on gross domestic product. So we'll go onto the next slide.
And we will start with our Federal Reserve Bank of Atlanta infographics. This is a poster series. There are 13 in this series, posters for the classrooms, seven featuring economic topics like we see here, gross domestic product. There are also six on personal finance topics, and as you can see here, they're very bright and eye-catching. The gross domestic product infographic covers, as you can see, the definition. It also covers the expenditure model, and also a topic that's oftentimes very difficult for students, what is included and what is excluded as we measure GDP. And [it] also covers the formulas for nominal and real GDP, the GDP deflator, and per-capita GDP.
This link that we have here at the bottom of this slide links to all 13 of the posters, and also there is an order form where you can order a complete set or whichever ones you'd like to have in your classroom, for free. And also, all of these infographics also come with activities. And if we go onto the next slide, I'll give you a sample by showing you the activity that accompanies this infographic. So we'll go on to the next slide.
I will tell you more about that. So this infographic activity for GDP starts with this quote, 1968, from Robert Kennedy, where he's talking about what was known in his time as GNP or gross national product. It was changed to GDP in 1991. But he's talking about, if you go to the left, part of the quote, that it tells us everything about America except for why we are proud that we are Americans. He talks about wisdom and learning and courage and quality of education, kind of the best things in life are free. And we know that GDP is a monetary measure. It measures the final value of all…and the market value of all final goods and services that are produced within a country in a given period of time.
And so what this exercise does, first, it'll take students through looking at what GDP was when Robert Kennedy made this quote, which was $800 billion, and then looking at it today. And then they do an activity where they're each given a little slip, as you can see here on the right, and these slips are connected, so they find a partner that has a slip connected to theirs, for instance, they are a devotion to country, that would match up with the U.S. flag. And then once they have found their match, they would identify what is and what is not in GDP.
For instance, the ticket to a theme park would be yes, but theme park stock, not, since that's a financial transaction. Quality of education, as mentioned by Robert Kennedy, no, but if a county school system purchases interactive whiteboards, that would be. And then they would identify which part of GDP, using the expenditure model, that it would relate to. The ticket to the theme park, consumption, the interactive whiteboards, government, and so forth. And so that's just a look at one of the activities, and there are activities to accompany all of our infographic posters there. And you can see the link to the activity for this one. If we'll go on, then, to the next slide.
Here we see Economy Matters, which is our online publication from the Federal Reserve Bank of Atlanta. It has topical articles of interest about the regional economy, about the Southeast, and here we see one of the quizzes that are associated with Economy Matters. There's about 20 quizzes. They cover all different topics, the Fed, tourism, holiday economics, money, and many on the Southeast economy, of course. And this one takes gross domestic product from the different states that are covered by the Federal Reserve Sixth District, and what you try to do is match them up with actual GDP from countries.
And so I'm from Florida and I was pretty surprised to find out that the GDP of Florida is equivalent to the GDP of Turkey. So maybe you can take that quiz and find out what your state…where the economy there matches up in GDP. And when you take this quiz you will also have the ability to tweet your score. And so that is Economy Matters quizzes, and I will go on to the next slide, which will feature some of our video content.
And this is The Fed Explained. So, The Fed Explained is a series of short videos. This one that's featured here on GDP is about four minutes. There are eight in the series, and they cover different topics, monetary policy and other functions of the Fed, different types of economic standards, regional and central banking, and, of course, your GDP and inflation. And so this one features GDP, and tells the difference between real and potential GDP. Also, again, that topic that's sometimes hard for students, what is counted and not counted in GDP, and how GDP is used to measure the economy. And I'll tell you a little bit later how you…additional ways that you can use this in the classroom. And there is the link to those videos. And I'll go onto the next slide, which brings us to The Classroom Economist.
The Classroom Economist is our online professional development portal. It's something that you can use for yourself for professional development, or you can use these features with your students, or both. And so The Classroom Economist has many topics under the heading of banking. We have economic indicators, as you can see here, and also the Federal Reserve. And in this gross domestic product one, which we're featuring, I'll tell you about some of the lesson components that you'll find in each of the modules that are in The Classroom Economist.
There will be a lesson. This one is, What is gross domestic product? All the lesson procedures will be given there for you. This one has a PowerPoint lesson, What's in GDP? There also is a Smart Board file to accompany most of the modules. If you do not have a Smart Board, we also have instructions on how you can use the files without that software. There is a narrated presentation, which is a PowerPoint that has a voiceover that will give the basics on each of the topics.
We also have a Test Your Knowledge interactive, which is a PowerPoint-based quiz. This is something you can use to test your own knowledge or with your students, because it is in the PowerPoint. There you can use it and modify it for your own use and you can change it to meet your needs. And then we also have a resources guide. We also have videos, and those videos include an economist's perspective, which is a primary source where we have an economist talking on the…different topics. We also have a lesson demonstration. So, for instance, in this module, the What is gross domestic product? lesson is demonstrated by the author of the lesson, because sometimes you will see a lesson and you're not really sure how it's going to work in a classroom. So we have master teachers demonstrating the lessons, and then you see we also have a link to The Fed Explained videos that I just showed you. And now we'll go on to the next slide.
And you can see I do have the link there, to The Classroom Economist as well. And I'll show you some more features from The Classroom Economist. So here we see the PowerPoint and lessons for What's in GDP? As students go through this, as you take them through this PowerPoint, they do have a worksheet that they are filling out, and they also have an activity where they're testing themselves on their knowledge of the components of GDP. Other parts of the lesson include a matching activity where they take definitions of key terms involving GDP and match those up. And they also do a primary source activity with the Bureau of Economic Analysis GDP report.
On the right-hand side, we see a snippet from an economist's perspective. Here we have Tom Cunningham, who has now retired, but who was a senior economist, vice president, and regional executive for the Federal Reserve Bank of Atlanta. And he is giving the basics on What Is GDP? Now both the economist perspective video and also The Fed Explained video, those are wonderful to use in the classroom, but if you want to go a little further and see what your students have retained from the video, and kind of test their knowledge, there is something through this Federal Reserve Bank of St. Louis, The Econ Lowdown.
And The Econ Lowdown has an online learning system where you can, just with an email, you can sign up. You can create a class. You can upload all of your students. And then, what you can do is, you can assign these videos and as you assign these videos, they can then, after they watch the video, take a quiz. And the results of their quiz, their scores, will come straight to your inbox and you can use that for the economist's perspective. You can use that for The Fed Explained. And you can also see that they will have many other videos there as well as online courses. And it's all free. And so that's a way you can use these videos in the classroom. And that's just an update on our resources, and I will hand it back to Julie.
Kornegay: Thanks, Lesley. Let's see. We need to go to the next slide, I believe. So we've reached the Q&A segment of today's program, and we have lots of questions rolling in.
Our first one is for Troy. How has the Fed's view of manufacturing in the U.S. changed as our new president has been sworn in?
Balthrop: OK, that's a good question. I would answer it by saying, not much at all, quite frankly. From the Fed's point of view, there's a lot of talk in the press right now about the trade and things of that nature, but, you know, I'm going to answer this in kind of a wonky way here. It's something I get asked about a lot, is a manufacturing renaissance occurring in the United States, and I think the first thing you have to do is define what manufacturing renaissance is. If you define that by, is manufacturing becoming more advanced, or is it becoming more dynamic? Then the question to that is, I mean, the answer to that is, yes, we are having a manufacturing renaissance. However, if you define that by, are there a lot of jobs coming back to the United States? Well, you have to define that as…answer that with a no, there's not necessarily a manufacturing renaissance going on.
So our view hasn't changed that much. You know, there is some onshoring occurring, in other words, jobs coming back. Or, I'm sorry, not jobs, but companies coming back to the U.S. from overseas. That has been occurring for a little while, but that doesn't necessarily translate into a lot of jobs coming back because a lot of the jobs that were outsourced overseas, if they come back to the U.S., it only takes, necessarily, you know, maybe one person to perform that job that it was taking 10 people in China to perform because our manufacturing is so much more advanced and automated here. So, long answer there, but I would say, it's still a little too early to tell what President Trump's policies are going to do, but the answer to it right now is, no, it hasn't changed.
Kornegay: OK, great, thanks, Troy. So our next question is for Mike. As a teacher in an advanced manufacturing classroom in a high school setting, what would you say is important for us to teach our high school students looking to get into the manufacturing workforce following high school?
Stockard: OK, thanks, Julie. I hope this doesn't sound like a copout answer a little bit, but to me, the biggest struggle we have is with soft skills. And if I looked at our number one reason why people turn over once they're placed, a lot of it is attendance. They can't show up for work on time. They may have planned days where they're…you can stay at a job and if you miss three days within the first 60 days, then you lose it. What ends up happening is people will take the days when they don't really need to, and when they get themselves into a bind, they still don't have days left to take. So that's our biggest reason for turnover. So anything you can do on teaching the importance of showing up is big.
And then being able to follow directions and showing the ability and initiative to learn a new task, I mean, I think that's the biggest thing. We actually screen, at our company, for some of our bigger clients. We will give a group of people a set of directions. We call it…we basically call it process testing where we give them a list of directions and ask them to follow that, and then time them while they complete that task. So you could do that with a set of Legos, actually. And we have a client where we do use Legos. So I think that the ability to follow directions and, again, it sounds kind of basic, but having a positive attitude and looking for more and looking to learn, so…thanks, Julie.
Kornegay: Thank you. I have another question for Troy. Troy, what is the reason for the decline in manufacturing jobs since 1979?
Balthrop: Yeah, that's another good question. It basically boils down to advances in technology. I mean, there have been some jobs that have been sent overseas, obviously, but the biggest reason is advances in automation and things of that nature. Actually, if I recall, there was a study by the Boston Consulting Group. In 1980 it took about 25 jobs to generate 1 million in manufacturing output. And in the U.S. today, it takes more like five jobs. [Note: Balthrop later checked his source for these figures and found it was MIT Technology Review, not Boston Consulting Group.] So that's much…how much more efficient the manufacturing environment is operating now than it was in 1980. So, you know, yeah, that's the main reason, is advances in technology.
Kornegay: All right, thank you. Our next question is for Mike. How best can we promote manufacturing jobs in the high school classroom? Students are regularly pushed by parents, teachers, and counselors to get advanced degrees.
Stockard: I think that's absolutely positive that parents are still pushing their kids to get advanced degrees. Troy mentioned this in one of his slides. Some of the manufacturing myths that he pointed out about the dirty, dark, dingy, dangerous environment, if you go into a manufacturing facility today and with OSHA regulations and how careful everyone is with safety, you'd be shocked if you have not visited one lately. But they're some of the clean…there's offices I've walked into that I'm more scared of than a manufacturing facility sometimes. So there's great opportunity and, again, there's a lot of learning you do on the job.
We have a lot of…you know, there's a lot of managers that we work with and even general managers of facilities that may have a high school diploma but have learned so much through that industry. So we think it's a great…you know, and obviously, higher education is not an option for everyone, too. So, you know, some students even go to school for a year or so and decide that's not for them, but that doesn't mean that life is over. There are still great careers and great advancement opportunities in the blue-collar workforce.
Kornegay: OK, great, thank you. The next question is for Troy. How does the value of the dollar affect manufacturing firms?
Balthrop: OK, the obvious drawback with a strong dollar for manufacturing firms is that it makes U.S. goods more expensive abroad. A strong dollar means that U.S. consumers pay less for imports. It means that foreign consumers must pay more for U.S. exports. So the strong dollar and the weak dollar, they have kind of positive and negative effects. A strong dollar helps U.S. consumers because it makes foreign goods cheaper. Yet it hurts U.S. exports, and therefore U.S. production and employment in the long run. For instance, it makes the United States a less affordable travel destination for foreigners.
Kornegay: All right, thank you. So, we're going to wrap up here in just a moment, but I've got one more question for Mike. Do you find it difficult to locate qualified young adults, candidates, for open positions?
Stockard: I think we're able to find people. The challenge we have is that consistency and being able to show the ability of staying in one place for any period of time. We do a lot of millennial training with our clients through our company. And I don't know if this is exactly right or not, but I think I read something the other day that said, "Millennials now might have as many as 17 jobs by the time they turn 30 years old." It was something that really made me kind of shake my head a little bit. But I think, you know, when you see something on a résumé or an application where somebody's moving every three or four months, that's obviously a little bit of a bad sign for us. And, unfortunately, that does happen a lot more in that 18-to-24 range.
So we're hoping…we're actually working on something right now that I think Julie will get back out to you guys, but it's not quite ready to go today. But we're going to have a portal separate from the elwoodjobs.com that will be, kind of, something targeted at high school students that I hope will be beneficial for you guys. And it'll talk a little bit about some of the things I mentioned on the soft skills, and what's important to employers while they're looking for people right now. So hopefully it'll be some good tips that students can look at. And then through that they'll have the ability to go through and do an application online with us. And so we're hopefully able to help out in that way, too. Thanks, Julie.
Kornegay: Good, great, thank you. All right, well, let's move on to the next slide, please. And so if you enjoyed today's webinar, I wanted to go ahead and have you save the date. Our next webinar will explore opportunity occupations and careers in health care. So more information will be forthcoming, but mark your calendars for April 10 from 3:30 to 4:30 central. Next slide, please.
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