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Nichola Lowe CURS

Part of the series “Viewpoints on Resilient and Equitable Responses to the Pandemic” from the Center for Urban and Regional Studies at The University of North Carolina at Chapel Hill.

The COVID-19 pandemic is causing people around the world to question how this virus will affect the many public and private systems that we all use. We hope this collection of viewpoints will elevate the visibility of creative state and local solutions to the underlying equity and resilience challenges that COVID-19 is highlighting and exacerbating. To do this we have asked experts at UNC to discuss effective and equitable responses to the pandemic on subjects ranging from low-wage hospitality work, retooling manufacturing processes, supply chain complications, housing, transportation, the environment, and food security, among others.

Nichola Lowe is professor of city and regional planning and interim director of the UNC Center for Urban and Regional Studies. Her research focuses on the institutional arrangements that lead to more inclusive forms of economic development. Her briefing focuses on efforts by North Carolina manufacturing businesses to retool production systems to meet the critical needs of hospitals and frontline health care providers that are responding to the novel coronavirus.

Transcript – Viewpoints on Equitable and Resilient Responses to the Pandemic: Nichola Lowe on Manufacturing

The coronavirus has put parts of our economy in overdrive. And not just to keep up with increased demand for home deliveries—but more critically, to replenish medical supplies and protective gear that health care workers urgently need to protect themselves while also treating those who are sick.

As a strong manufacturing state, North Carolina is well-positioned to meet this challenge now and in response to future pandemics and also natural disasters.

President Trump hinted at this opportunity when he invoked what is called the Defense Production Act. But his unwillingness to use that federal authority to require manufacturers to meet national demand means that North Carolina businesses and support institutions need to act fast.

Fortunately a growing number of factories in our state have already accepted the challenge.

One of the first to respond was a gin distillery in Durham which has dedicated production lines to alcohol-based sanitizer, supplying other businesses and facilities that need to keep surfaces clean—and others have followed their lead. Dozens of North Carolina apparel making factories are now making washable covers that health care workers can put over their respirators to extend their use while they wait for replacements to arrive.

There is the potential for other firms to join their ranks. While it is true that North Carolina has lost hundreds of thousands of manufacturing jobs in recent decades, we are still a top producing state with tremendous capacity to retool thousands of factories to meet immediate and future demand.

We are a leading state in textile manufacturing and with specialized strengths in high performance and medical grade fabrics. We have a robust biomanufacturing industry that makes life-saving medical devices, vaccines and other human therapeutics. Additionally, we have large numbers of factories that make natural products, cosmetics and processed foods—many of which could be repurposed to meet pandemic needs.

And a growing number of state-funded institutions are working hard to help our manufacturers respond. The Carolina Textile District is one example—they have stepped in to secure supplies and shipping materials and design standardized patterns to help their network of 80 cut-and sew apparel firms scale their operations. The North Carolina Biotechnology Center is coordinating a similar response with medical device and life science firms. Here at UNC Chapel Hill, our campus-wide network of maker-spaces is working with UNC hospitals to produce face shields using 3-D printed technologies.

These examples and others reinforce the value of having a robust innovation and economic development ecosystem—with publicly funded institutions that guide industry response in times of crisis.

But they also speak to the need for reinforcing actions to ensure that what we do today does not intensify underlying economic vulnerability—but rather sets the stage for longer lasting economic opportunity. With the right institutional support, we could leverage this current crisis to spur manufacturing regeneration and job growth for years to come.

First, we need to ensure manufacturers are not responding from a position of economic desperation. We need measures in place that guarantee their financial security and with funding mechanisms to defray costs associated with revamping existing systems and production lines—including support for workforce retaining. Federal economic aid is a necessary start. But we need to ensure manufacturers make full use of that support and add more funding to the pot.  Several other states are redirecting economic development incentive dollars to support production retooling—suggesting we could do the same here. Additionally, we can stabilize firms by doubling down on small business assistance and manufacturing extension efforts—ensuring manufacturers get the support they need to improve production systems and workplace practices, and also become more innovative, as they take on new products and customers going forward.

We also need to ensure our supply chains are ‘high road’; that means that manufacturers within them pay their workers family-sustaining wages and offer benefits, such as paid sick leave, which is now so critical. But firms that are unable to make this commitment are often vulnerable themselves. Smaller manufacturers for example, struggle with a high cost burden and thin profit margins. Some are also threatened by larger customers that are looking to squeeze out more profits for themselves. We can stop this predatory behavior by asking institutions like hospitals, universities and government agencies to be leaders in promoting ‘high road’ practices, using their emergency purchasing power to rebalance existing supply chains, and in ways that set a higher standard for all procurement going forward.

Finally, we need to discourage manufacturers from using employment arrangements that put workers at even greater risk. Manufacturers throughout this country increasing rely on third party staffing agencies to meet their employment needs, which overtime are known to chip away at the manufacturing wage premium. If these arrangements remain permanently in place, they will reduce the attractiveness of manufacturing jobs for next generation job seekers and ultimately put the future of North Carolina manufacturing at risk. Let us empower economic and workforce support institutions to help reverse this trend, ensuring workplaces are stable and opportunity-rich, also allowing employers to retain talent and their workers to plan for a better future.

What we produce now in North Carolina is a matter of life and death. But for the survival of North Carolina manufacturing, it will also matter how the factories and workers making these essential goods are supported and valued now and in the future.



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