Deputy Secretary of Defense Pat Shanahan, on behalf of Secretary of Defense Jim Mattis, presented the report “Assessing and Strengthening the Manufacturing and Defense Industrial Base and Supply Chain Resiliency of the United States” to President Trump per his earlier executive order on strengthening the sector, the department said Friday.
Trump directed Mattis to lead a whole-of-government effort to identify and assess risks in the manufacturing and defense industrial base. The Pentagon said Mattis made recommendations to the president “to ensure a robust, resilient, secure, and ready manufacturing and defense industrial base.”
The multi-agency risk assessment of the industrial base of the United States involved experts from the Departments of Defense, Commerce, Labor, Energy, Homeland Security, and other agencies and offices.
The report blames budget uncertainty, “collateral damage of globalization” and China for weakening the U.S. manufacturing base and noted “emerging gaps in our skilled workforce, both in terms of STEM as well as core trade skills (e.g., welding, computer numeric control operation, etc.) pose increasing risk to industrial base capabilities.”
“The rise of single and sole source suppliers,” the report warned, “create individual points of failure within the industrial base, as well as fragile suppliers near bankruptcy and entire industries near domestic extinction.”
“Due to erosion that has already occurred, some manufacturing capabilities can only be procured from foreign suppliers, many of which are not domiciled in allied and partner nations. The concomitant gaps in U.S.-based human capital and erosion of domestic infrastructure further exacerbates the challenge. Ultimately, these negative impacts have the potential to result in limited capabilities, insecurity of supply, lack of R&D, program delays, and an inability to surge in times of crisis.”
The Pentagon said the report recommendations will “address immediate risks identified in the manufacturing and defense industrial base and initiates follow-on efforts to create a strategy for building this base for next-generation technologies.”
“This comprehensive and government-wide effort demonstrates that manufacturing and the defense industrial base are vital to not only our nation’s economic security, but also to our national security,” the department added.
“The secretaries of Defense, Commerce, Energy, and Labor are taking action to implement the report’s recommendations for remedying the nearly 300 vulnerabilities it identified,” White House press secretary Sarah Huckabee Sanders said in a statement, adding that the Trump administration “is pursuing an aggressive agenda to rebuild our military through increased defense spending and modernization initiatives.”