Economic Development

OPINION  – Manufacturing in California is an often invisible, but critical part of our daily lives. Whether you’re rolling off your mattress in the morning, taking a slice of bread for your sandwich at lunch or closing your blinds at the end of the day, you’ve in some way benefited from the invisible hand of our state’s manufacturers.As a California business owner for more than two decades, I have been fortunate to observe the resilience, dedication and innovation that characterize our local entrepreneurs. However, as rewarding as this journey has been, it has not been without its share of struggles.

When my family business started over 70 years ago, it was a modest venture that served the needs of our immediate community. Since then, it has grown into a global supplier that is making products that are essential components for industrial machinery and goods that make our world go round.

Small- and medium-sized manufacturers account for 70% of California’s manufacturing output of over $300 billion a year. Manufacturers also employ more than 1.3 million people. Because of that, it is imperative that manufacturing continues to thrive in California, but small and medium-sized businesses like mine continue to face immense challenges.

The past few years have been a rollercoaster ride from weathering the COVID-19 pandemic to navigating a myriad of supply chain issues and inflation, to keeping up with the ever-rising costs of doing business in the state.

Gov. Newsom understands this and his commitment to small businesses has helped substantially. During the pandemic he supported grants to help businesses as well as incentives for companies to move to California and create full-time jobs through a research and development tax credit. The Governor’s focus on investing in R&D has allowed manufacturing firms to innovate.

Now, the state has an opportunity to build on its foundation by investing further in manufacturing.

While I defer to state leaders on the details of such a measure, what I know is that investing in a tax credit could be done in a way that is revenue-neutral for local communities, while incentivizing manufacturers to invest here in California in way that benefits our entire economy.

A manufacturing tax credit would allow manufacturers to leverage innovative technology, invest in carbon-reducing equipment, support environmental, social and governance (ESG) policies and offer competitive salaries and benefits.

This investment would also lead to more jobs and produce more local tax revenue that would help cities and counties provide the services that we all need.

Manufacturing businesses were built on ideas – innovation. However, manufacturing in our state is at a crossroads. Other states are becoming more competitive and the increasing costs of doing business in California make it harder, especially for small- and medium-sized businesses, to grow. Strong businesses create a strong supply chain to fuel the larger, well-known brands of California.

The time to act is now. We can’t afford to wait and miss out on our opportunity to maintain a competitive advantage.

I’m optimistic that California leaders will decide to act and empower manufacturers to lead California toward a more innovative, secure, and prosperous future.

Pamela A. Kan is the president of Bishop-Wisecarver (BWC), a family-owned, American manufacturing company located in Pittsburg, CA.

-This OpEd was written by Pamela A. Kan, President of Bishop-Wisecarver (BWC), and was first published in Capitol Weekly on Dec. 6, 2023.