Construction of new factories in America is surging: The time is now to consider connectivity needs

The United States has experienced a striking surge in construction spending for manufacturing facilities, according to the U.S. Department of Treasury. That agency attributes the surge in large part to the bipartisan Infrastructure Investment and Jobs Act (IIJA), Inflation Reduction Act (IRA), and the CHIPS Act, each of which provided direct funding and tax incentives for public and private manufacturing construction.  Manufacturing construction averaged $84.5 billion per year from 2005 to 2022, and then skyrocketed to $166 billion between January and April 2023, as the funding began to flow. Most of the growth has been driven by computer, electronics, and electrical manufacturing. 

Since the beginning of 2022, real spending on the construction of computers, electronics, and electrical manufacturing has nearly quadrupled, according to the Treasury Department. In fact, “More than 50 new facility projects have been announced since the CHIPS Act was introduced, and private companies have pledged more than $210 billion in investments,” according to the Semiconductor Industry Association.

While the funding may have spurred plans and pushed projects forward, there’s still time for most of these endeavors to address their future connectivity needs. Even in the nascent construction stages, manufacturers can find cost efficiencies, increase productivity and enhance on-site safety with Unified Communications solutions. Further, today’s manufacturing processes call for scalable, ultra-high speed, high bandwidth network infrastructures.

A UC or UCaaS offering combines all the tools companies need for communication into one environment. The proper solution delivers one platform for text, voice, and video communications, accessible anywhere via any device. This can allow construction and manufacturing business leaders to eliminate redundant apps and outdated solutions, increase efficiency and control costs in the home office, as well as on job sites. 

Further, manufacturers should consider the need for a networking solution with the capacity to minimize traffic latency from the cloud to reliably access critical automation technologies. As such, today’s factories should leverage modern networking architecture featuring diverse, resilient, secure infrastructure paths between geographically distributed facilities, cloud and data center environments.

Advanced network solutions exist today, with smart cameras that provide important data, analytics, and control to enhance manufacturing operations. Most cameras come with encrypted solid-state storage and two-factor authentication to keep footage from getting into the wrong hands. Beyond security, motion sensors in the cameras streamline monitoring of equipment, production floors, loading and receiving docks, and a diverse range of other applications.

New factories mean new skilled labor jobs to fill

Not surprisingly, construction job openings totaled 495,00 in November, up 111,000 from the same time the prior year, buoyed in part by the spate of new manufacturing projects. “The number of open, unfilled construction positions increased to the highest level since the end of 2022,” said Associated Builders and Contractors Chief Economist Anirban Basu. “Projects in Arizona and South Carolina, for instance, have paused in recent months due to an inability to find enough skilled workers. As construction spending in manufacturing and infrastructure subsectors continues to surge in the coming months, labor shortages should remain a top concern for the construction industry.” 

The surge in construction will eventually translate into a surge in hiring for manufacturing jobs, said Aaron Sojourner, a senior researcher at the W.E. Upjohn Institute for Employment Research.  Consequently, some manufacturers are exploring, or implementing, automated or lights-out manufacturing processes to reduce reliance on a challenging labor pool. While automation goals differ for individual manufacturers, the process for all is highly dependent on computing power, software and networking technologies.

The surge in building is shining a light on construction and manufacturing labor shortages. However, according to the MIT Technology Review, “The IT staffing shortages brought on by Covid-19 and the Great Resignation are still affecting companies today. In a poll of global tech leaders conducted by MIT Technology Review Insights, 64% of respondents say candidates for their IT and tech jobs lack the necessary skills or experience. Another 56% cite an overall shortage of candidates as a concern.”

Solutions are available that can help manufacturers bridge the gap created by a skilled IT labor shortage. These managed solutions can simplify IT operations by delivering reliable network transport across multiple access types, Unified Communications and security within an integrated managed service. A team of experts can design and implement a fully- or co-managed service that integrates hardware, management, portal and security with the right connectivity solution, nationwide, backed with 24/7/365 support.

In most cases, managed or co-managed solutions prove more efficient than self-managed solutions that require in-house resources for ongoing network configuration, maintenance and administration. However, these efficiencies are largely offset by management overhead when enterprises choose managed service providers that don’t deliver integrated security, SD-WAN, or WiFi with network services as a complete single-source solution. 

Connectivity needs in new manufacturing facilities

Factories run on operational technology (OT), which controls machines, robots and other physical devices. These OT applications are becoming increasingly complex, as the Industrial Internet of Things (IIoT) becomes more deeply entrenched in today’s factories.  At the most basic level, the IIoT is the integration of sensors, software and machinery with internet connectivity to collect, analyze, and act upon vast amounts of data.

Factories can be equipped with IIoT technology to monitor equipment, automate maintenance, and optimize production schedules while simultaneously enabling real-time decision-making and predictive analytics. For this to work, the network for IIoT must be kept highly available. A managed network solution can ensure configurations are consistently applied across locations and that cybersecurity features are automatically and seamlessly updated.

As both traditional OT and IIoT become more robust and complex, the need for the ever-higher bandwidth these methods require should be a key factor in IT decision-making. Low latency is a critical need as well, as some industrial applications require response times of less than 1 millisecond.

Smaller manufacturers often have the same connectivity needs as their larger corporate cousins. And if the skilled labor crunch, especially acute in the IT sector, is tough on bigger firms, it’s likely even tougher on smaller more resource-constrained manufacturers. As such, deploying managed solutions and services, designed to scale as application and connectivity needs grow can be even more beneficial in this space.

Spectrum Enterprise offers a fully managed comprehensive cloud-based solution that simplifies network management and security. It addresses persistent IT challenges, including network security, complexity, and future scalability. It enhances end-to-end protection with features such as automated updates, an advanced firewall, and unified threat management. 

Learn more about Managed Network Edge, powered by Cisco Meraki. 

Spectrum Enterprise can help

Advances in analytics, security and cloud connections, as well as upscaled connectivity and networking solutions to support them, can accelerate the effectiveness of technologies on the production floor. Spectrum Enterprise has the nationwide fiber infrastructure, network engineers, local support and industry-leading SLAs that translate to an advanced, fully integrated IT ecosystem. Our expertise, award-winning connectivity and networking solutions can streamline your operations — from the supply chain through production to your end customer’s experience.

Learn more about building and maintaining a scalable, secure and managed manufacturing network.