Regional Manufacturing Hubs – A Path to Innovation

by Jörgen Eriksson on June 22, 2015

All across the World, policy makers are attempting to encourage innovation through public sector initiatives. In Europe and Asia, Science Parks and Incubators are tools for regional development projects, and in United States innovation districts and often privately run incubators in the cities fuel the development of the knowledge economy.

However in most nations, manufacturing is still a major part of the economy. In the United States, manufacturing accounts for roughly 12 percent of GDP, keeping the sector an important driver of the economy and job creation. In 2013, President Obama proposed the launch of “a network of manufacturing hubs” through which industry, universities, community colleges, and governments will work together to develop and deploy new manufacturing technologies.

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Quad Helix HQThe manufacturing hubs idea reflects an emerging consensus among a large number of industry leaders, technology analysts, and economic development professionals in United States, that regions are the place to work on technology-based development and that regions need to be anchored by hubs of collaborative R&D where industry can work with academia and government to innovate and implement technology gains.

Industries and the regions in which they are located profit from the presence of structured centres of excellence in which industry led consortia of firms, universities, community colleges, state and local governments, and other actors collaborate to solve innovation and technology deployment challenges of critical interest to advanced industries.  That is the point of innovation hubs.

As documented in the European Unions concept of Smart Specialisation, innovation, and its deployment, does not happen just anywhere. It happens in places and, most notably, within metropolitan regions where companies and workers tend to cluster in close geographic proximity, whether to tap local supplier networks, draw on a pool of skilled workers, or profit from formal and informal knowledge transfer.

If properly channelled, these co-location synergies ensures that value added through innovation spreads through and remains within the domestic manufacturing supply chain.  Nor is this only a “soft” benefit.  Such local synergies, accumulated region by region, can foster greater efficiency within and across manufacturing supply chains and add to a nation’s competitiveness.

On July 9, 2014, the Brookings Institute hosted a half-day conference focused on manufacturing expansion policies and their efficiency and impact on the future of U.S. innovation.  Panels focused on the impact of the Regional Manufacturing Hubs and other policy initiatives that aims to spur growth of the United States’ industrial economic base.  Below are a set of videos from the event, well worth watching.

Manufacturing–A Vital Part of Innovation
John White Jr. on Manufacturing is in my Blood
Jason Miller on Manufacturing in Context of Economy Overall
Jason Miller on Manufacturing Creates High-Quality Jobs Throughout Economy
Jason Miller on Manufacturing Punches Above Its Weight
Jason Miller on Manufacturing and Obama´s Four Pillars
A Path to Innovation–Keynote Address
A Path to Innovation–Panel 1
A Path to Innovation–Panel 2

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