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Manufacturers' optimism remains the highest in two decades, according to an industry association, despite ongoing trade wars and workforce shortages.

The National Association of Manufacturers on Friday released its outlook survey for the third quarter of 2018 on Manufacturing Day, when manufacturers are holding thousands of events across the country to encourage students and parents to explore careers in modern manufacturing.

More than 92 percent of 718 respondents said they are optimistic following enactment of tax and regulatory changes. Workforce shortages, however, could threaten that future.

"This is truly a crisis," said Carolyn Lee, executive director of The Manufacturing Institute, the association's social-impact arm. "We have to talk about what we do and how we make things in America and that manufacturing create good, family-supporting jobs."

Average optimism among manufacturers was 93.9 percent over the past four quarters, according to the association. It is the highest one-year average in the survey's 20-year history.

That is despite the United States leveraging a trade war with many other nations, as it levies 25 percent tariffs on imported materials such as steel and aluminum and other goods. Some manufacturers said their costs have increased from the duties, though others are reaping the benefits of the protectionist measure.

In the most recent quarter, more than 73 percent of respondents said attracting and retaining a quality workforce was their No. 1 challenge. Nearly half surveyed said the inability to attract a quality workforce was their biggest threat.

One in 4 manufacturers said they have had to turn down new business opportunities because of this challenge, and 1 in 3 said they have held off plans to hire more workers because of workforce constraints.

"As I talk to companies, they say the tax reforms have freed them up to invest and add capital and regulatory reform have made a big difference," Lee said. "The reality is that’s what’s driving them. Investment is increasing, and they want to hire, but they are holding off from hiring."

The Bureau of Labor Statistics recently reported that manufacturing job openings hit an all-time high in July with 500,000 open jobs in the United States. About 1.3 million manufacturing jobs have been added since the Great Recession, Lee said, but a report from Deloitte estimates 2 million manufacturing jobs will go unfilled between 2015 and 2025.

Lee said apprenticeships and events such as the grassroots-organized Manufacturing Day are critical to the growth of industry.

"A lot of people have this antiquated vision of manufacturing," Lee said. "They have this image in their mind of an assembly line and of doing the same thing, and it's a dark, dingy, smokestack association of what manufacturing looks like."

Instead, Lee said manufacturing is clean and full of technology, machines and touchscreens. In the past, the manufacturing association reported more than 60 percent of students who participate in Manufacturing Day said they are more likely to consider a manufacturing career and more than 84 percent of parents said they feel the industry could be a good opportunity for their children.

"First-hand experience is really key," Lee said. "We need to show them and talk with them about what is being made in their backyard."

bnoble@detroitnews.com

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