The nation's 33,000 middle market manufacturing companies are increasingly leveraging advanced manufacturing techniques to generate increased revenue and productivity growth.  A new report released today by the National Center for the Middle Market (NCMM) and the National Association of Manufacturers(NAM) indicates that the 47 percent of mid-market manufacturers currently using advanced manufacturing techniques have experienced a 20 percent profitability increase over the last five years.  These companies are most frequently leveraging automation, computer technologies, process technologies and information technologies. 

In the past year, mid-market manufacturers using advanced manufacturing techniques report a 3.4 percent increase in job growth and project employment growth at 4.7 percent in the next 12 months.  According to the research, advanced techniques are most commonly leveraged by middle market companies with annual revenues between $100 million and $1 billion. 

The report also highlights that vast opportunities to generate further growth remain.  According to the 53 percent of companies who have not yet adopted advanced manufacturing techniques, 78 percent indicate they plan to do so in the next three to five years.

The National Center for the Middle Market, a partnership of GE Capital and the Ohio State University's Fisher College of Business, defines the U.S. middle market as companies with annual revenues between $10 million and $1 billion.  This sector encompasses nearly 200,000 companies -- including Jamba Juice, K-Swiss, Fat Burger and Tootsie Roll-- and accounts for nearly one-third of U.S. GDP.

Advanced Techniques Highlight Mounting Skills Gap

While widespread adoption of new advanced manufacturing techniques is a positive indicator of economic growth, the report also reveals a startling skills gap in the American workforce to fill these jobs.  Ninety-five percent of companies utilizing advanced manufacturing techniques reported that innovation has changed recruitment and training methods and 81 percent of users say demand for skilled manufacturing is significantly higher now than in the past.

Among users, 93 percent report a skills deficiency and 74 percent of users report deficiencies in science, technology, engineering and math.  Users identified inadequate technology/ computer skills, lack of technical skills (certification, associate degree, etc.), and inadequate math skills as top recruitment challenges.

"Through a renewed focus on training and collaboration with education institutions, more mid-market manufacturers may be able to break past this skills gap, but there must be a concerted effort to close this void in order to fully reap the benefits that advanced manufacturing has to offer," said Dr. Anil Makhija,  National Director for NCMM. 

According to Chad Moutray, Chief Economist for the National Association of Manufacturers, "Mid-market manufacturing growth reflects the new manufacturing -- a sleek, technology driven sector with exponential power to drive the economy. However, these positive steps have made a skilled workforce more important than ever. 600,000 manufacturing jobs remain unfilled due to employers' inability to find skilled workers. As a result, efforts to improve STEM education and enacting comprehensive immigration reform are essential to closing the skills gap and continuing this trend of growth in mid-market manufacturing."

Increased Profitability Creates Middle Market Growth

The growth among mid-market manufacturers reflects the broader resilience of middle market companies nationwide, who together will generate approximately 70 percent of all projected national job growth this year. According to the NCMM's soon-to-be-released Middle Market Indicator (MMI), companies with annual revenues between $10 million and $1 billion project 2.5 percent employment growth in the upcoming year, compared with the nation's average rate projected employment growth rate of 1.11 percent, based on jobs data compiled from the first half of 2013.

The second quarter's MMI, a survey of 1,000 middle market executives to be released July 24, reveals revenue growth is stabilizing above five percent and employment growth projections have increased 20 percent over last quarter.   The MMI also confirms a growing sense of optimism for the national and global economies that is driving increased investment in technology and new employees. A record 48 percent of middle market executives reported confidence in the global economy, compared to 22 percent last year.  Further, nearly two-thirds of middle market executives are at least partially confident in the U.S. economy, compared to 50 percent one year ago.