During a visit to North Carolina this week, President Obama announced to a group of college students that the first of a series of “manufacturing institutes” will soon open in their state, thanks to a $70 million grant from the Department of Energy and a the contributions of a number of manufacturing firms. As the NYT notes, this institute intends to focus on semiconductors:
The institute will use advanced semiconductor technology to develop a new generation of energy-efficient devices for automobiles, consumer electronics and industrial motors. Earlier Wednesday, Mr. Obama toured a Finnish company, Vacon, that makes drives used to control the speed of electric motors, to increase their energy efficiency.
Critics have noted that over the past year this initiative has grown far less ambitious than the original vision of 15 institutes distributed across the country. But lack of ambition isn’t the biggest problem for this strategy. The real problem is that the model of job growth it is chasing is obsolete. The modest revival in America’s manufacturing sector notwithstanding, we’re not about to return to the large-scale manufacturing employment of the 1950s; future job growth is going to come in the service and IT sectors. This is where we should focus our attention.While the rest of the economy is switching to DVDs, President Obama is doubling down on VCRs.