'We have a plan': Biden claims policies are reviving US manufacturing

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President Joe Biden speaks in the Eisenhower Executive Office Building in Washington, DC, US, on Thursday, July 27, 2023. (Ting Shen/Bloomberg via Getty Images)

ALBUQUERQUE, N.M. - President Joe Biden declared Wednesday that his economic policies are reviving U.S. manufacturing as he toured the West to drum up support for his efforts on jobs and inflation in the face of voters' doubts.

"I’m not here to declare victory on the economy. We have a lot more work to do," Biden said at Arcosa Wind Towers, a facility that once made Solo cups and other plastics but is now shifting to manufacturing wind towers. "But we have a plan. And it’s turning things around."

Arcosa, the president said, was a "great example" of how the administration's legislative achievements have bolstered jobs and investments in the U.S. The company had to lay off workers in Illinois and Iowa before Biden's Inflation Reduction Act became law last year, but customers placed $1.1 billion in wind tower orders with the company afterward, according to the White House. The stock has risen more than 20% in the past 12 months.

"Folks — when I think climate, I think jobs," Biden said, referring to cleaner energy production in his remarks at the plant making wind towers.

He pointed to climate-related investments not only at Arcosa but at major corporations such as General Electric, and added: "Every one of these companies has pointed to the clean energy law that we originated and I signed for making these investments."

The claim from Biden and the White House that the administration has bolstered U.S. manufacturing is backed by a rise in construction spending on new factories. But factory hiring has begun to slow in recent months, a sign that the promised boom has yet to fully materialize.

That hasn’t stopped the White House from telling voters ahead of the 2024 election that the Democratic president’s agenda has triggered a revival in factory work.

"Hundreds of actions coordinated through his entire government are sparking a manufacturing renaissance across the United States," White House climate adviser Ali Zaidi told reporters ahead of Biden's New Mexico speech.

Biden's trip to the Southwest is playing out against the backdrop of his reelection campaign and as a majority of U.S. adults say they believe the economy is in poor shape. The president is trying to break through pessimism that intensified last year as inflation spiked. His trip included a Tuesday speech in Arizona and will end with remarks Thursday in Utah. In 2020, Biden won both Arizona and New Mexico, key states that he likely needs next year to secure another term.

The president does have a case to make to the public on employment. As the U.S. economy has healed from the coronavirus pandemic, hiring has surged at factories. Manufacturing jobs have climbed to their highest totals in nearly 15 years. This is the first time since the 1970s that manufacturing employment has fully recovered from a recession, expanding by 789,000 jobs since Biden took office.

But the pace of job growth at manufacturers has slowed over the past year. Factories were adding roughly 500,000 workers annually last summer, a figure that in the government's most recent jobs report fell to 125,000 gains over the past 12 months.

Biden administration officials have said there are more factory jobs coming because of its infrastructure spending, investments in computer chip plants and the various incentives in the Inflation Reduction Act.

In April, the Economic Innovation Group, a public policy organization, issued a report that called construction spending for factories a "nationwide boom." The report notes there are signs that manufacturing gains are most prominent outside the Midwest, which has historically identified with the sector, as more plants open in southern and western states. But EIG is less sure that a full-fledged restoration of manufacturing is in the works as the sector has been in decline for decades.

Labor Department figures show that total factory employment peaked in 1979 at nearly 19.6 million jobs. With just under 13 million manufacturing jobs now, the U.S. is unlikely to return to that level because of automation and trade.

Adam Ozimek, chief economist at EIG, said jobs can be a flawed way to measure a manufacturing revival. He said better metrics include an increase in factory output, whether the U.S. can shift to renewable energy to blunt climate change and whether the government can achieve its national security goals of having a stronger supply chain.

"It's way too early to declare anything like a manufacturing renaissance," Ozimek said. "We are decades into structurally declining manufacturing employment. And it’s not at all clear yet whether the positive trends are going to outweigh that continuing headwind."

And Jay Timmons, president and CEO of the National Association of Manufacturers, argued that federal rules were hampering any benefits of the Biden administration's manufacturing policies.

"The positive impact of manufacturing investments made during the Biden administration are being undermined by a rising tide of complex and often unbalanced federal regulations," he said on the social media platform formerly known as Twitter.

The Inflation Reduction Act has been the centerpiece of Biden's climate agenda. However, he's been under pressure from some activists and progressives to declare a national climate emergency, something he was asked about in an interview with the Weather Channel while visiting the Grand Canyon in Arizona on Tuesday .

Biden said he's already done that "practically speaking," citing the legislative steps and executive action that he's taken.

"It is the existential threat to humanity," he said.

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Associated Press writers Darlene Superville and Seung Min Kim contributed from Washington.

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