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4 Big Trends in the Domestic Foundry Market

4 Big Trends in the Domestic Foundry MarketWhile metalcasting is a narrow niche within manufacturing, the market is broad and diverse. The foundry industry is a 35 billion dollar a year business in the United States. One reason the industry continues to thrive is that many of the essential components in cars are casted metal. Car parts like engine blocks and cylinders, which contain cavities, can’t be made by machining. Manufacturers can only create them using the cast metal process. Metal casting is also used to make agricultural and construction equipment, airplanes, compressors, jewelry, art, and more. Here are four of the biggest trends in the domestic foundry market.

1. A Climate of Uncertainty

One of the prominent characteristics of the foundry market right now is uncertainty. The current climate of uncertainty stems largely from recent tariffs. The administration’s industrial tariffs have benefited some sectors and harmed others. It isn’t yet clear what the impact of these industrial tariffs will be on the foundry market overall. This uncertainty is driving the decision-making of foundries across the country. Companies are concerned about the cost of business, so they’re watching their bottom line and being more careful about who they hire. When there’s this much uncertainty, it’s hard to plan for capital investment, hiring, and management expansion. As a result, positions tend to stay vacant for longer.

2. Global Competition

Another issue is worldwide competition. In 1977, the US had 3,000 foundries that employed over 200 employees. Now, there are only between 400-500 of these foundries left. Both NAFTA and unfair foreign competition have greatly affected U.S. foundries. Environmental regulations in China are much less rigid than they are in the United States, which gives them a competitive advantage. In the U.S., manufacturers put large sums of money into environmental compliance instead of using it to invest capital in new projects. China manages to bypass tariffs by importing products in through Vietnam and other nearby countries.

3. Labor Shortage

The foundry market also faces a labor shortage. In the 1990s, NAFTA reduced the prominence of manufacturing in the U.S., and we’ve been seeing the impact of this trade agreement ever since. Many companies moved their factories offshore, while other closed down their plants and reopened them in Mexico so they could import the products duty-free. Many employees lost their jobs because of this trend.

There has also been a cultural shift in recent years. Fewer young professionals want to work with their hands, so there aren’t as many people who have the skills and training to work in the foundry industry. In addition, because the number of foundry jobs decreased, many young people chose other industries in which to build their career. This has all contributed to a critical talent shortage.

4. Automation and Mechanization on the Rise

Another major trend is the increase of automation and mechanization. The metal casting process does not lend itself to automation as readily as it does to other sectors like the automobile or technology industries. However, automation is quickly becoming a norm in today’s society. Companies are going to do what they can to automate the metal casting process in order to drive growth amid the labor shortage and tariff uncertainty.

In Conclusion

The foundry market has several hurdles to overcome including tariff uncertainty and global competition, automation, and a labor shortage. Yet, there is a core, essential domestic foundry industry and an increasing number of job opportunities within that industry, especially for degreed engineers with training in foundry-specific technology. Now is a good time for young people to enter the foundry field as it offers a new generation the opportunity for good paying jobs with security and advancement opportunities.

 

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