The Government Circuit: An IPC Roadmap to Economic Recovery

As the COVID-19 pandemic exacts a growing toll, public and private actors worldwide are marshaling resources to combat the spread of the virus and save the lives of those who are critically ill. The electronics industry is doing its part by supporting the ramped-up production of respirators and other electronics-based medical equipment that hospitals need to treat the ill.

COVID-19 is also disrupting the lives of millions of people who are sheltering in place, working from home, and/or trying to find new work.

In this unprecedented crisis, IPC supports a sustained and bold policy agenda to help us all weather the economic downturn resulting from sweeping restrictions on business activity.

Actions Taken to Date

IPC commends governments and central banks around the world for responding quickly. In the United States, IPC commends President Trump and Congress for responding to the crisis with the issuance of a national emergency declaration, the invocation of the Defense Production Act, and bipartisan support for three stimulus packages. Moreover, the Federal Reserve’s decision to lower interest rates, buy government and corporate debt, and inject cash into the nation’s financial system will help maintain liquidity at a time when firms of all sizes need it most.

The Importance of the Electronics Manufacturing Sector

These moves will help support the resiliency of the electronics manufacturing sector, which supports more than 5.3 million U.S. jobs and drives more than $714 billion in U.S. GDP—almost 4% of the total GDP. Underscoring the importance of the sector, every U.S. electronics manufacturing job supports three other jobs in the U.S. economy. Electronics are at the heart of thousands of products and every industry. Clearly, the U.S. government should take extraordinary measures to keep this sector healthy.

IPC Members Concerned About Economic Impacts

The need is real. Many U.S. electronics manufacturers are feeling the effects of the coronavirus pandemic, according to a recent IPC survey of its members [1]. As of mid-March, almost 90% of respondents were concerned about the impacts, and more than two-thirds reported being told by their suppliers that there will be delays in shipments due to COVID-19. Almost two-thirds said they expect sales to drop in the first and second quarters of 2020 and for the entire calendar year, and some companies are cutting back on capital expenditures. Some manufacturers have closed their facilities and furloughed employees.

An IPC Roadmap for Economic Recovery

In addition to the unprecedented action already being taken in response to COVID-19, IPC urges policymakers to take additional, common-sense steps to help the electronics industry weather the economic crisis and drive the economic recovery.

Keep Essential Electronics Manufacturing Open

  • States and localities should adopt the Department of Homeland Security’s (DHS) definition for “critical infrastructure,” which covers factories related to defense and healthcare.
  • Commit to keeping these critical manufacturing facilities open.
  • Ensure that curfews do not impede a healthy workforce from getting to and from manufacturing facilities.

Support Supply Chain Resiliency

  • Congress should establish a $10 billion Electronics Manufacturing Initiative to enhance the resiliency and security of the nation’s electronics value chain by establishing public-private partnerships focused on the following priorities:
    • Capacity: Grow domestic capacity for electronics manufacturing and establish systems to monitor capacity in times of crisis.
    • Capabilities: Spur investment and R&D in artificial intelligence (AI) and other technologies that make U.S. manufacturers more globally competitive.
    • Workforce: Bridge the skills gap through more robust federal support for online workforce training and credentialing.
    • Resiliency: Establish metrics for industrial base resiliency with capacity, capabilities, and geographic diversity as key factors.
    • Security: Integrate resiliency and security initiatives to strengthen the trusted electronics supply chain.

Spur Global Trade by Cutting Tariffs

  • Suspend the imposition of import duties through December 31, 2020, on all products from countries that agree to provide reciprocal treatment for U.S. exports.
  • Allow companies to defer payment of import duties through December 31, 2020.
  • Reinvigorate negotiations with China on a “Phase 2” deal and suspend Section 301 tariffs on imports related to healthcare and other vital supplies necessary to combat COVID-19.
  • Increase funding for U.S. export promotion programs, including the U.S. Foreign Commercial Service and Small Business Administration, to help U.S. manufacturers compete in the global marketplace.

Delay Non-Essential Rulemakings

  • The Trump administration should put a 90-day pause on non-essential regulatory rulemakings unless they are directly related to protecting public health, environmental health, or economic recovery.
  • We need our business leaders to focus on maintaining compliance with existing regulations while taking on appropriate pandemic response actions.  
  • A 90-day pause on new proposals and implementation of new requirements will likely guarantee better compliance in due time.

Facilitate Shipping and Transportation Recovery

  • Support the continued and robust operation of U.S. ports to ensure so that food, medical, equipment, and other vital supplies will continue to reach people.
  • Incentivize airlines to expand cargo capacity and keep air freight rates on par with historical norms.
  • Enact landmark transportation legislation that, among its goals, expands capacity on U.S. freight corridors.

Support the Financial Security of Manufacturing Workers

  • Facilitate federal and state cooperation to allow companies to pay a portion of wages to underemployed workers who may be receiving unemployment benefits.
  • Provide a tax credit for employers who continue to pay workers who are quarantined, have exhausted their allotted leave time, or have had their workplace shutdown.

Keep Manufacturing Workers Healthy

  • Issue CDC guidance related to cleaning processes, social distancing, and other operational practices that can help stem the spread of the virus in facilities that must stay open given the “essential” nature of their production.
  • Enhance tax deductions for employers who invest in safety equipment, including hand-washing stations, respiratory equipment, and cleaning products.

These actions—expressed in terms aimed at U.S. policymakers but applicable to policymakers all over the world—would allow electronics manufacturers to serve the needs of a world in crisis, while also providing immediate and long-term economic stimulus.

If you agree with the proposals in the IPC Roadmap for Economic Recovery [2], I encourage you to download it and share it with your government officials.

If your company is experiencing any problems or uncertainties caused by the government’s response to COVID-19, we want to hear from you and assist you. If you would like to receive our weekly advocacy reports and occasional action alerts to get involved in our advocacy, visit our IPC Advocacy Team page and sign up here.

If you need information on how COVID-19 is affecting our sector, including webinars with industry experts and tips for what you can do, IPC’s coronavirus resource page is here.

References

  1. IPC, “The Impact of the Coronavirus (COVID-19) Epidemic on Electronics Manufacturers: March Update,” March 2020.
  2. IPC, “An IPC Roadmap to Economic Recovery,” March 2020.

Chris Mitchell is IPC’s VP of global government affairs. For more information, contact him at ChrisMitchell@ipc.org.

Back

2020

The Government Circuit: An IPC Roadmap to Economic Recovery

03-26-2020

As the COVID-19 pandemic exacts a growing toll, public and private actors worldwide are marshaling resources to combat the spread of the virus and save the lives of those who are critically ill. In this unprecedented crisis, Chris Mitchell explains how IPC supports a sustained and bold policy agenda to help us all weather the economic downturn resulting from sweeping restrictions on business activity.

View Story

The Government Circuit: IPC Marks Progress in Government Advocacy in 2019

01-14-2020

As we turn the calendar from 2019 to 2020, it is a natural time to take stock of the past year and look ahead to the year to come. Here are a few of the top stories of 2019 from Chris Mitchell's perspective as a government relations professional working to support the electronics manufacturing industry through public policy advocacy.

View Story
Back

2019

The Government Circuit: Europe Eyeing Changes in RoHS Environmental Regulations

12-02-2019

One of the world’s most comprehensive and restrictive environmental regulations is undergoing a comprehensive regulatory review, and IPC is actively involved in the process, coordinating industry views and advocating on behalf of the electronics manufacturing industry. Chris Mitchell gives an update on activities related to the European Commission’s Restriction of Hazardous Substances Directive (RoHS) Directive.

View Story

The Government Circuit: U.S.-China Tariff War Threatens American Jobs and Investments

11-06-2019

Fifty-five percent of companies report they are facing higher costs as a result of higher tariffs, which are affecting, on average, about one-third of the total dollar value of the products they import. Some companies say their costs have increased more than the direct costs of the tariffs due to higher administrative and operational burdens to sort it all out.

View Story

The Government Circuit: Recession Fears, Trade Wars: What Can We Do?

09-04-2019

Despite many strong economic indicators, recent news reports are filled with growing concerns about the risk of a U.S. and global recession in the next 12–24 months. Amid a prolonged trade war between the U.S. and China, and an "inversion" between long-term and short-term bond yields, a recent survey found that 74% of economists predict the next recession will hit by the end of 2021.

View Story

The Government Circuit: Trump Praises Industry on Workforce Issues, IPC Launches Grassroots Platform

08-07-2019

July was a fun, productive month for IPC on the government relations front. Most notably, IPC’s workforce development efforts were recognized at the White House in Washington and on a factory floor in Michigan. On another front, we've launched an online platform that makes it easier for our members to contact their elected officials, and we’re using it to seek more R&D funding for an important industry project.

View Story

The Government Circuit: IPC Promoting R&D on Lead-free Electronics, Streamlined Chemical Data Reporting, and More

07-04-2019

For the most part, working in government relations is like running a marathon, not a sprint. It can take weeks, months, or even years to formulate an industry consensus position, educate the relevant policymakers in legislatures and executive branch agencies, build alliances and broad support, and ultimately push a final action over the finish line. That metaphor was certainly fitting in recent weeks as IPC scored two interim wins on issues we’ve been working on for years.

View Story

The Government Circuit: Team IPC Working on North American Trade, EPA Regulations, EU Policy, and More

06-13-2019

In one of the highlights of IPC’s work every year, top executives from electronics companies from across the U.S. came together in Washington, D.C., recently to call for policies that will drive the electronics industry’s success. Attendees met with leading policymakers to discuss the U.S.-Mexico-Canada Agreement (USMCA), the electronics supply chain, EPA regulations, and workforce education.

View Story

IPC’s D.C. Focus: Chemicals Regulations, Lead-Free, Export Controls

05-07-2019

From North America to Europe, Asia, and beyond, the future of the electronics manufacturing industry is shaped in many ways by government policies. That’s why IPC maintains an active, multifaceted government relations program, including leadership and networking opportunities for member company executives.

View Story

U.S. Tax Law Boosts Growth, But Uncertainties Loom

04-17-2019

Monday, April 15 was the deadline for millions of Americans to file their income tax returns, so this is a good time to review the Tax Cuts and Jobs Act of 2017 (TCJA) as well as the current tax policy landscape and how these rules are affecting the electronics industry.

View Story
Copyright © 2020 I-Connect007. All rights reserved.