Study Quantifies Impact of Manufacturing Extension Partnership Program – With Pennsylvania Affiliates a Prominent Contributor
A January 2021 study by Summit Consulting, a New Jersey-based quantitative research firm, and independent analysts from the W.E. Upjohn Institute for Employment Research of Michigan found that the National Institute of Standards & Technology’s (NIST’s) Hollings Manufacturing Extension Partnership (MEP) Program generates substantial financial returns for the U.S. Treasury by creating jobs, increasing profitability and facilitating expansion within small and mid-sized manufacturers that utilize MEP affiliate services.
The MEP Program, launched in 1988 to provide small and mid-sized manufacturers with technology, training and operational expertise that they would not otherwise have access to, is managed by NIST and the U.S. Department of Commerce and implemented through a national network of designated MEP Centers and affiliates nationwide. Firms receive MEP Center and affiliate services through seminars, on-site assessments, training programs, customized engagements and networking programs.
Based upon MEP Center clients surveyed and studied throughout Fiscal Year (FY) 2020, the MEP Program generated nearly $13.60 of additional federal revenue during the year, primarily through increased personal income taxes remitted for jobs created and retained as a result of MEP Center engagements, for every $1.00 of federal investment in the Program. The $13.6:$1 return is not inclusive of additional taxes, duties or other remittances associated with the $20.9 billion increase in gross domestic product (GDP) or $39.2 billion increase in total manufacturing output attributed to MEP Center and affiliate engagements.
The study also found that MEP Center and affiliate engagements bolstered nationwide employment by more than 252,000 jobs during FY 2020 as MEP clients, their suppliers and firms within other sectors dependent upon a healthy manufacturing economy avoided layoffs and created new positions. As a result, personal net income across the nation rose by $15.5 billion during the 2020 fiscal year.
In addition to providing a high return to the U.S. Treasury, the MEP Program directly benefitted small and mid-sized manufacturers through the provision of services that generated meaningful impact in 84% of more than 10,000 MEP Center clients surveyed for the study. Among the most prominent impacts reported was a better trained workforce (52%), operational cost savings (51%), avoidance of layoffs (47%) and the upgrading and modernization of equipment and facilities (43%). Throughout the survey process, clients most commonly cited MEP Center and affiliate staff expertise and the practical cost of services as their primary reasons for participating in the Program.
Across Pennsylvania, the MEP Program is operationalized through PA MEP and its network of seven (7) affiliates – DVIRC, Catalyst Connection, the Innovative Manufacturers’ Center (IMC), MANTEC, the Manufacturers’ Resource Center (MRC), NEPIRC and NWIRC. Our region’s affiliate, NEPIRC, serves 11 counties of northeastern, northern and part of central Pennsylvania. Throughout FY 2020, PA MEP affiliate clients reported the creation and retention of 5,566 jobs, $68.9 million of cost savings and $606.3 million of incremental revenue as outcomes of their engagements with those affiliates. They also credited their engagements for facilitating $140.2 million of additional investments in their Pennsylvania-based facility and workforce. Across the national network, PA MEP affiliates are consistently among the top performers.
“This study serves as another data-point proving the value of the MEP Program and its high return to our federal stakeholders and the U.S. Treasury. Perhaps more importantly, however, it illustrates the way in which NEPIRC, our fellow PA MEP affiliates and MEP Centers nationwide make meaningful and quantifiable improvements and advances within the manufacturers that utilize our expert advice, training and professional services,” said Eric Joseph Esoda, NEPIRC’s President & CEO. “We’re proud of the way in which our services allow our clients to avoid layoffs and create more jobs by reducing non-personnel operating costs, eliminating waste and increasing their revenue,” he added.
Manufacturers interested in learning more about how NEPIRC can assist their business or receiving a no-cost business assessment can contact Mr. Esoda at Eric@NEPIRC.com.
NEPIRC is a not-for-profit professional service organization that provides world-class consultative services in critical aspects of manufacturing operations, talent development, strategy and growth to small and mid-sized manufacturers across an 11-county region of northeastern, the northern tier and parts of central Pennsylvania. NEPIRC’s goal is to improve the quality of life for its community, Pennsylvania and the United States through a strong, vibrant, resilient and growing manufacturing economy. Click here for more information about NEPIRC.
About Summit Consulting
Summit Consulting is a quantitative and management consulting firm that turns data into actionable intelligence. Summit’s core mission is to deliver data-driven solutions to help make governments more effective and society more just. Summit couples core expertise with methodology to derive sound, transparent and reproducible results. Click here for more information about Summit Consulting.
About the W.E. Upjohn Institute for Employment Research
The Upjohn Institute is a private, nonprofit, nonpartisan, independent research organization devoted to investigating the causes and effects of unemployment, identifying feasible methods of ensuring against unemployment and devising ways of alleviating the distress and hardship caused by unemployment. The Institute strives to bring new knowledge to the attention of policy makers and decision makers while making knowledge and scholarship relevant and useful in their applications to the solutions of employment and unemployment problems. More information is available at www.Upjohn.org.