Parts Manufacturing Holds the Key to New Jobs in Automotive Industry

Recently, the Trump Administration set out to have conversations with the top industrial giants of the automotive industry. His motive: to figure out a way to move auto industry jobs from Mexico back to the United States. But should auto-assembly be his focus? The auto industry job market is saturated with careers, not in auto-assembly, but in parts manufacturing. It is well-known that the automotive parts industry holds many of the auto industry’s total jobs and most of its plants are in Mexico. When we focus on the details of the auto-economy, we see that for every auto assembly job there are 7 auto-parts workers. It’s clear that a set of more detailed initiatives focusing on the auto-parts industry should be set in place to reinforce its growth.

Since 2012, automotive parts manufacturing jobs in the United States have risen 19% per MEMA (Motor and Equipment Manufacturing Association). This growth, per the survey conducted by MEMA, can be attributed to the rising use of technology in manufacturing. This allows for the creation of better products made in the United States by skilled laborers. This report, is very timely, with the current initiatives taking place by the Trump Administration. It’s important to review some of the potential steps, proposed and already underway, that could drastically affect the auto-parts industry.

NAFTA 

President Trump recently signed an executive order that could potentially change the NAFTA agreement. Now, although well-intentioned, this could come at a steep cost. Most economists agree that the three countries involved in the NAFTA Agreement (Canada, Mexico, and the United States) are so intricately intertwined that this could be a dramatic defeat for all three economies. It is true that Mexico contains most of the jobs in the automotive industry. It is also true that a tariff could force those companies to move up North. But this shift in production location could be slow, taking up to 15 years for the creation of reshoring strategies, plants, and hiring of US workers. This could impact the auto industry, dropping the sales of cars drastically. Of course, this depends on the details of the dismantling of the NAFTA agreement that will be worked out in the upcoming weeks.

Growth

What should be the focus when it comes to the automotive industry for improving the economy? Toronto auto-parts company CAMBRIDGE has seen the benefits of focusing on innovation and technology. They’ve incorporated processes like metal-stamping, zinc plating, as well as e-coating into their auto-parts creation. Processes like these require skilled laborers that the industry can rely on. This is the key to success in their company, and they leverage it to increase job offers. Perhaps they are the example to follow or one of just many worth considering.

Focus

Focusing on creating an educated and skilled workforce in the automotive industry would require that attention not only be focused on restructuring NAFTA, but also on the establishment of an education plan within the public-school system that would incorporate STEM abilities into the curriculum. We must put politics aside and contemplate the strategies that are effective in recuperating the auto industry and manufacturing in general.

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