A recent study by the W.E. Upjohn Institute found the National Institute of Standards and Technology’s (NIST) Manufacturing Extension Partnership (MEP) Program generates a substantial economic and financial return of nearly 9:1 for the $130 million annually invested by the federal government.
Washington D.C. – The Manufacturing Extension Partnership (MEP) is a federal public-private partnership that provides small and medium-sized manufacturers (SMMs) technology-based services they need to thrive in today’s economy and create well-paying manufacturing jobs. The MEP program is managed by NIST and the U.S. Department of Commerce and implemented through a network of centers located in every state. MEP centers are not-for-profit organizations that employ a network of more than 1,300 industry experts who work directly with manufacturers in the field to improve productivity and enhance competitiveness.
Using the national REMI® model, along with the results from the FY2016 NIST MEP client impact survey conducted by Fors Marsh, the W.E. Upjohn Institute for Employment Research study finds that economic returns are substantially higher than previously reported by the MEP program due to broader economic effects.
Each year, an independent firm surveys manufacturers regarding the impact they have achieved from MEP Center services. In 2016, MEP clients reported $9.4 billion new and retained sales of which $2.3 billion is new sales providing an economic stimulus of 17 to 1 (based on the $130 million federal investment) and the creation or retention of 86,602 jobs. The Upjohn study reports that the $130 million invested in MEP during FY2016 generated an 8.7 to 1 increase in federal personal income tax ($1.13B/$130M federal investment). The study looked solely at personal income tax and not business taxes, and provides a conservative estimate of the return.
In addition, the Upjohn study finds more jobs were generated by the MEP program than directly reported by its clients. The study finds that more than 142,000 additional jobs existed in the U.S because of MEP center projects last year than would have without the program. This estimate includes direct, indirect, and induced jobs generated by MEP projects. These jobs support additional manufacturing jobs critical to U.S. supply chains and jobs outside of manufacturing.
Lastly, the Upjohn study also examined additional areas of economic impact not previously reported by the MEP Program; personal income is $8.44 billion higher and GDP is $15.4 billion larger, translating to an increase of $1.13 billion in personal income tax revenue to the federal government than would be reported without the program.
Dave Boulay, PhD, President of the Illinois Manufacturing Excellence Center and Chair of the American Small Manufacturers Coalition stated, “Accountability to economic returns is essential for any federally funded program dedicated to strengthening our economy. These results reinforce what manufacturers that have used MEP already know – this program provides a strong return by strengthening our nation’s manufacturers and preparing their workforce to compete in the global economy.”
To view the study in its entirety, please visit: https://research.upjohn.org/reports/226/
David Boulay, Board Chair
American Small Manufacturers Coalition