U.S. manufacturers, plagued by supply chain problems and near-record inflation, are demanding action from politicians in the rapidly approaching midterm elections.
The National Association of Manufacturers (NAM) released its “Competition to Win” program on September 13, calling for action in tax policy, workforce development and other areas to boost the competitiveness of American industry. NAM CEO Jay Timmons and board members also discussed the action plan call during a call Monday afternoon.
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“Fixing problems is what manufacturers do, but we need additional solutions from policy makers to ensure we can stay competitive and become more competitive, especially with the potential for a looming recession” , said Chuck Wetherington, president of BTE Technology, during the call Monday.
Gross domestic product fell in the first two quarters of 2022. Wholesale inflation remained elevated in August, with the annual figure rising 8.7% from a year ago, according to data from the Department of work.
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One area where NAM has called on elected leaders to act is workforce development. Labor shortages in the manufacturing sector are a “long-term problem”, Wetherington said on Monday.
Wetherington and Greene Tweed vice president of operations Fernando Torres said manufacturers were working to “upgrade” existing workers and attract new ones.
To address industry-wide workforce challenges, NAM has called for expanding Pell grant programs to “include short-term or accelerated education models” and investing in education programs. learning and “earning and learning”. The amount of tax-free education assistance employers can provide to workers should be increased to $11,000 a year, the group argued in its plan.
NAM also said immigration reform can help address labor challenges, calling on politicians to increase employment-based immigration as a percentage of green cards and change visas to nonimmigrant and temporary worker programs.
Meanwhile, the association said new tax incentives and other tax provisions would also help encourage competitiveness and investment in US manufacturing.
As an example, a board member pointed to the provisions of the CHIPS and Science Act, which allocates more than $52 billion for research, development, manufacturing and workplace development in the field of domestic semiconductors and offers tax credits to encourage investment in chip manufacturing.
Three areas of tax policy that are important to manufacturers are the research and development (R&D) tax credit, the ability to spend R&D and capital investment, and business interest deductions, Timmons said. during the call.
In addition, NAM called for extending and making permanent the tax deduction for business income earned “through a flow-through entity” and keeping profit tax rates “low and competitive.”
Ketchie president and owner Courtney Silver said lawmakers making changes to tax policy could help keep small manufacturers from feeling “stuck between a rock and a hard place” when making decisions about company investments.
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“It’s very important that we take steps to expand and lock in that transfer deduction, increasing those incentives around R&D and protecting those provisions around full expense and interest deductibility,” she said. .
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