Yesterday’s meeting of the Council on Jobs and Competitiveness saw a long list of expensive and long-term recommendations, but one important idea was missing that could help generate new jobs cheaply and quickly: A Competitiveness Audit. A Competitiveness Audit will help identify which industries are competitive, near-competitive, or not competitive, so we can target future public and private investments in a way that will stimulate the economy and create jobs that are competitive internationally.
Right now we have no concrete data on U.S. competitiveness – in other words, we are flying blind. It’s incredible that for all of the data swirling around the internet, for all the information being pumped out of statistical agencies and for all of the numbers people worldwide have immediate access to, we do not have basic information on how U.S. prices compare to foreign-made prices for comparable items. We can find out Celine Dion owns about 3,000 pairs of shoes but have no clue how much a piece of furniture made in North Carolina compares to a similar piece being imported from China.
President Obama’s new “insourcing” initiative, launched last week, gets right to the heart why we need a Competitiveness Audit. Tackling the issue of restoring competitiveness head-on is a welcome commitment from the Administration, but we need more data to tackle it successfully. Finding ways to insource production (recapture imports) in a way that expands U.S. exports and restores U.S. competitiveness will be extremely challenging, if not impossible, if we don’t know where to look. After all, what good is investment if it goes toward an industry that has little chance of being recaptured, like clothing? The last thing America needs is to spend valuable investment dollars that get us to the same place as that Alaskan bridge: nowhere.
If the Administration is serious about encouraging insourcing and restoring competitiveness, something PPI’s Chief Economic Strategist Michael Mandel noted in a recent blog could create many U.S. jobs, then it’s important to get it right. Effectively targeting investment to encourage innovation and revitalize manufacturing is the right way to move forward. Conducting a Competitiveness Audit is the first step.
Photo Credit: Dave Reid
