Manufacturing Extension Programs

Small- and medium-sized manufacturers represent the bulk of U.S. manufacturing firms, are integral parts of the support chains for commercial and defense products, and provide about 40 percent of manufacturing employment. These manufacturers, however, often lack the expertise, time, money, and information needed to upgrade in order to successfully compete in the modern marketplace. During the past decades, states began funding various technology assistance programs. During fiscal years 1992-94, states spent more than $1 billion on such initiatives, including manufacturing extension programs, which are state/federal partnerships that offer manufacturers assistance in modernizing or upgrading their operations. This briefing report summarizes U.S. manufacturers' views on the services the received from manufacturing extension programs in 1993. GAO obtained manufacturer's views on the impact of program services on their business performance and the factors affecting the impact of program services. GAO also obtained the views of manufacturers who do not avail themselves of program services.

GAO found that: (1) 73 percent of manufacturers responding to the questionnaire believed that MEP assistance positively affected their overall business performance; (2) MEP assistance improved the manufacturers' use of technology in the workplace, the quality of their product, and the productivity of their workers; (3) the companies that committed their own financial resources to implementing MEP recommendations reported greater benefits from MEP assistance than other survey respondents; and (4) other factors affecting the impact of MEP services included the companies' financial input, the expertise and experience of MEP staff, and the affordability of MEP assistance.