Manufacturing in the New York region, including the northern New Jersey and southern Connecticut areas, declined for a fifth straight month in December, according to a recent Bloomberg article. While there exists a healthy optimism about the future of manufacturing in that region over the next six months due to increased consumer spending, the future seems to hinge on the resolution of the fiscal cliff controversy in Washington, D.C.
"The biggest challenge for manufacturing is lack of confidence due to uncertainty in fiscal policy," Tom Simons, an economist at Jefferies Group Inc. in New York, told the news source. "That is slowing down activity. There are reasons for manufacturing to come back but it's going to be a couple of months before we start to see the acceleration."
More than $600 billion in tax increases and budget cuts are set to go into effect in 2013 if lawmakers cannot reach a resolution. The outcome of the ongoing negotiations between Democrats and Republicans on the Hill will directly impact manufacturing, not just in the Tri-State area, but throughout the U.S. and international markets as well.
While a resolution to the fiscal cliff debate that avoids such tax increases and budget cuts would clearly be favorable to the industry, manufacturers must be prepared for the future regardless of what happens in Washington. Innovative technologies that improve process efficiency, lead to higher-quality products and lower manufacturing costs are essential for these markets to flourish.
Take consumer electronics for example. Aluminum has become a popular material used to create lightweight and portable devices. As such, advanced techniques for soldering aluminum have become highly sought-after. And with sapphire-protected camera lenses on smartphones catching on, manufacturers will benefit greatly from cutting-edge sapphire bonding processes.
One way or another, manufacturers will have to find creative ways to build products no matter what economic situation the country finds itself in.