The MEP, launched in 1988 under the Reagan administration, received $143 million this year from the Commerce Department, or 43 cents per taxpayer. The program estimated its impact in a report this year. “For every one dollar of federal investment, the MEP national network generates $17.9 in new sales growth for manufacturers,” the authors wrote. “. . . For every $1,501 of federal investment, MEP creates or retains one manufacturing job.”
Denny Dotson, the chairman of Dotson Iron Castings in Mankato, Minn., said his company probably would have died without the program’s help.
“They helped us and so many manufacturers stay competitive in today’s international climate,” he said. “We grew.”
About 12 years ago, as American trade with the rest of the world intensified, Dotson knew his firm needed to adapt to avoid layoffs. The family-owned business took about eight weeks to finish a casting order.
MEP stepped in, Dotson said, and showed the business how to reduce waste in the manufacturing process. Five years later, it was wrapping up orders in eight days.
As productivity improved, so did business — and Dotson hired about 25 more machinery workers, paid an average of $21 an hour. For a business of 140 workers, that represented significant growth.
“Without that,” he said, “we would not have been able to succeed as an iron foundry in the United States, I’m convinced.”
The program has long enjoyed bipartisan support. It was created, according to its website, in response to Japan creating more competition for U.S. manufacturers.
Last year, by President Barack Obama’s request, Congress increased MEP’s funding from $130 million to $142 million for 2017.
Then-Commerce Secretary Penny Pritzker argued in 2015 that the program would help revitalize American manufacturing.
“We have a window of opportunity right now to rebuild a competitive manufacturing sector in this country,” she said. “Not only does the MEP program provide a return on investment to taxpayers, it brings real financial benefits to the businesses that use its service.”
Mark Chalfant, who runs MEP’s Kansas arm, said the organization is devoted to supporting the state’s 3,100 manufacturers. Jobs in aerospace, agriculture equipment, food processing and metal fabrication prop up the middle class.
He learned of the proposed cut early Thursday — his chief financial officer broke the news — and plans to meet with Kansas legislators. “We plan on showing them our worth,” he said, “that we have a real impact here.”
One example: Last week, Chalfant said, he met with a business owner in Kansas City who makes hamburger buns for chains such as Wendy’s.
The Mid-America Manufacturing Technology Center, part of MEP, had connected him with productivity experts, who found the owner needed to update his freezer door. They installed a new design that kept the buns in a colder environment, which allowed the company to sell them to a wider range of areas.
“He was able to hire 20 more employees, just because of that,” Chalfant said. “We work on projects like that all the time.”
Over the past two decades, manufacturing jobs in the United States have steadily dwindled, dropping from 17 million in 2000 to about 12 million today. Economists ascribe the shrinkage to trade and automation, which has enabled some factories to make more things with less people.
The day before Trump unveiled his budget cuts, he told a Detroit audience that he would fight for American jobs, particularly manufacturing jobs.
“We've lost one-third of our manufacturing jobs,” he said of the economic climate since the North American Free Trade Agreement was signed in 1994. “They've stolen our jobs. They've stolen our factories. And our politicians stood back and watched.”