Obama plans twin manufacturing hubs to create more jobs

US President Barack Obama has announced setting up of manufacturing hubs in Michigan and Chicago, asserting that he wanted the next big job-creating discovery to be made in America.

"The point is, I don't want the next big job-creating discovery to come from Germany or China or Japan. I want it to be made here in America," Obama said in his remarks on manufacturing innovation institutes in the East Room of the White House.

While the Michigan hub would focus on developing advanced lightweight materials, the second one in Chicago would be a Digital Manufacturing and Design Innovation Institute, Obama said.

The Chicago hub, he said, is a consortium of more than 40 companies, 23 universities, labs like Northwestern and the University of Illinois, and nearly 200 small businesses. A number of other states are participating in this consortium.

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It is funded by a $70-million award led by the Defense Department, but the State and its businesses raised $250 million in private funding commitments to help win this bid and make it happen.

"Typically, a lot of research and development wants to be co-located with where manufacturing is taking place – because if you design something, you want to see how is it working and how is it getting made, and then tinker with it and fix it, and try something different," Obama said.

"So if all the manufacturing is somewhere else, the lead we've got in terms of design and research and development, we'll lose that too. That will start locating overseas. And we will have lost what is the single most important thing about American economy, and that is innovation," he said. 

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The country that gets new products to "market faster" and at less cost, they'll "win the race" for the good jobs of tomorrow, he said.

"We know these manufacturing hubs have the potential to fundamentally change the way we build things in America. So 10 years from now, 20 years from now, imagine our workers manufacturing materials that used to be science fiction – a sheet of metal that's thinner than paper but is strong as steel," he said.

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That's what the next generation of American manufacturing could look like," Obama said.

While the US has just four of these manufacturing hubs, Germany has 60 manufacturing hubs, he said.

"Germany has 60 of them. Part of the reason Germany has been able to take the lead in certain manufacturing areas is because they've invested in these hubs and then they invest in the training of the workers for these very precise machines and tools, and that means that that cuts into our market share when it comes to manufacturing around the world," he said.