Trade Agreements Offer Benefits for U.S. Employers and Employees

Global trade brings benefits to American workers and consumers.

The following op-ed was authored by Tom Linebarger, Chairman and CEO of Cummins Inc. and Chair of the Business Roundtable International Engagement Committee; and Mike Bertsche, the President & CEO of Camcraft.

After years of negotiations, the 12-nation trade deal known as the Trans-Pacific Partnership is facing its toughest challenge yet: election-year politics.

The fact is, TPP and U.S. trade agreements overall, offer tremendous benefits for U.S. employers and employees alike. Consider a few numbers: trade-related jobs grew 3.1 times faster than overall employment between 2004 and 2014, and nearly half of all U.S. goods exports to the world in 2014 went to just the 20 countries that the United States has free trade agreements with.

Unfortunately, the facts are being distorted by rhetoric on the presidential campaign trail, with candidates alleging that U.S. trade agreements like NAFTA have suppressed wages and cost American jobs. In fact, U.S. trade with NAFTA partners Canada and Mexico supports nearly 14 million U.S. jobs, according to a U.S. Chamber of Commerce study.

Moreover, contrary to the campaign rhetoric, U.S. jobs tied to trade also pay more than other jobs. According to a report by the Commerce Department, manufacturing jobs pay 18% more on average when tied to exports. The report also notes that foreign tariffs — like those TPP will eliminate — reduce the earnings of U.S. workers by as much as 12%.

We have to put politics aside and recognize TPP as an opportunity to support U.S. economic growth and high-quality American jobs.

The agreement will create opportunities to sell more U.S. goods and services to 11 Asia-Pacific countries. This region is already critical to America’s exports: TPP nations accounted for some 45% of all U.S. exported goods in 2014.

All told, TPP will eliminate more than 18,000 foreign tariffs on U.S. goods, opening markets to U.S. export growth. And because five TPP countries currently lack trade agreements with the United States, the deal will also open entirely new markets for American firms.

Just as important, the trade pact will put in place strong, enforceable rules for fair trade that actually improve on NAFTA and other past U.S. trade agreements. TPP is the first modern trade agreement that addresses the realities of our interconnected global marketplace. For example, it will establish intellectual property protections for American companies and inventors and raise foreign labor and environmental standards. It also will discourage other countries from using government procurement and state-owned companies to put American firms and workers at a disadvantage.

In short, TPP will open access to millions of customers for U.S. goods and services while boosting foreign investment throughout the United States. The resulting U.S. exports and international investment here will expand U.S. economic growth and jobs.

Watch Now: How The TPP Will Benefit The U.S. Economy

 

To understand how trade supports companies of all sizes, consider the relationship between our two companies. Headquartered in Columbus, Indiana, Cummins’ 25,000 U.S. employees design, manufacture and distribute engines and related products that are powered by diesel and natural gas. In 2014, we exported approximately $3 billion in U.S.-made products.

These foreign sales don’t just benefit Cummins and its U.S. employees; they also help our 2,500 domestic suppliers, such as Camcraft. Camcraft is a small company based in Illinois. Its 330 employees manufacture high-precision components used in Cummins engines.

As leaders of manufacturing companies large and small, we know how important trade and U.S. trade agreements like TPP are to the success of our companies and to businesses and farms across the United States.

The relationship between our two companies shows how exports ripple through the U.S. economy in a supply chain generating billions of dollars in revenue and thousands of jobs.

Previous U.S. trade pacts offer evidence: America’s current trade partners purchase 13 times as many U.S. goods per capita than countries with which we don’t have trade agreements. Those purchases support U.S. jobs.

When Congress takes up TPP, members should look beyond the divisive campaign rhetoric and seize the opportunity to support growth and jobs in their home states. By approving TPP this year, Congress will enable American workers, businesses and farmers to sell more in international markets — reaping the benefits before our foreign competitors do.

Editor's Note: The op-ed above also appeared in the following publications

The Indianapolis StarTrans-Pacific Partnership is good for U.S. workers

The New York Daily NewsTPP is good for American manufacturers and the people they employ

The Post and Courier - Election Rhetoric Sells Trade Agreements Short

Tom Linebarger Chairman and CEO

Tom Linebarger

Tom Linebarger became Chairman and CEO of Cummins Inc., the largest independent maker of diesel engines and related products in the world, on January 1, 2012.  Prior to becoming Chairman and CEO, he served as President and COO from 2008 to 2011, Executive Vice President and President, Power Generation Business from 2003 to 2008, Vice President and Chief Financial Officer from 2000 to 2003, and Vice President, Supply Chain Management from 1998 to 2000.

Cummins Nears 2020 Products-in-Use Environmental Goal

Cummins teams like this one in Seymour, Indiana (USA) are using regenerative dynamometers (behind them) to capture the energy generated testing engines to help power to the company’s plants.
Cummins teams like this one in Seymour, Indiana (USA) are using regenerative dynamometers (behind them) to capture the energy generated testing engines to help power to the company’s plants and meet Cummins environmental goals.

Cummins closed in on its 2020 products-in-use environmental goal in 2017, achieving 97 percent of its target with three years remaining to go.

 

The company's biggest environmental impact is through its products in use by its customers. Cummins has been working with customers for several years to help them operate Cummins’ products efficiently, reducing their environmental impact while saving customers money.

"Our products help to drive the basic foundations of the economy: moving food to store shelves; moving energy so that we can operate in our buildings, etc. But (our) products do impact the environment, that’s a really important thing for us to acknowledge,” Chairman and CEO Tom Linebarger said in a recent interview with the Environmental Defense Fund for its EDF+BUSINESS blog.

“That’s why we’re constantly asking what the opportunities are for us to innovate, so that we can drive wealth creation for our shareholders and for our customers while reducing the impact we have on the environment,” he said. 

Since 2014, the company’s fuel economy teams around the world have implemented more than 250 products-in-use projects, achieving a 3.4 million metric ton annual run rate of CO2 reduction toward the company’s goal of a 3.5 million metric ton run rate by 2020.

Projects have targeted machine integration, systems optimization and helping customers analyze their operations to reduce things like engine idling.

Cummins wants to cut CO2 emissions by nearly 16 million metric tons, saving customers up to $6.3 billion through greater fuel efficiency by the end of 2020. Cummins expects to work with about 20 percent of its customer base, touching nearly 2 million engines as it tailors engine specifications to customer applications.

Here’s a quick look at Cummins’ performance on other environmental goals:

WATER

Since the goal’s baseline year of 2010, water use adjusted for hours worked is down by 44 percent. The company’s goal is a 50 percent reduction by 2020.

Cummins’ water neutrality work is also progressing. Eight sites have now been validated as water neutral toward the company’s 2020 goal of 15. They are off-setting their water use with community improvements that either conserve water or make new sources available.

ENERGY AND GHG

Cummins has so far achieved about a 25 percent reduction in energy intensity (energy use adjusted by hours worked) toward its 2020 goal of a 32 percent reduction at its facilities.

The company had a number of challenges in maintaining progress on its goal, including several new buildings and distributor locations that were part of the Distribution Business segment’s North American consolidation

WASTE

Cummins in 2017 recycled 90 percent of the total waste the company generated, a slight increase over 2016. The company’s goal is to recycle 95 percent of its waste by 2020.

Ten sites have been certified as zero disposal sites – seven in Europe and one each in North America, the Asia-Pacific region and China – toward the company’s goal of 30 by 2020.

Eighteen additional sites are approaching zero disposal, but face challenges such as regulatory barriers in India and China, and the absence of vendors to help with hard-to-recycle wastes.

LOGISTICS

In 2017, Cummins changed its transportation management system provider. By the end of 2019, 80 percent of the Cummins network will be using an optimized transportation solution.

The change is expected to result in more accurate data, but the company will be unable to report its progress until the baseline data is stable, which is expected in 2018.

You can learn more about Cummins’ performance on its environmental goals by going to the Environmental section of the 2017 Sustainability Progress Report starting on page 14.

 

blair claflin director of sustainability communications

Blair Claflin

Blair Claflin is the Director of Sustainability Communications for Cummins Inc. Blair joined the Company in 2008 as the Diversity Communications Director. Blair comes from a newspaper background. He worked previously for the Indianapolis Star (2002-2008) and for the Des Moines Register (1997-2002) prior to that. [email protected]

Cummins Employees Support Diversity and Inclusion at Indy Pride Parade

Cummins employees gather before the parade starts in Indianapolis, Indiana (USA).
Cummins employees gather before the parade starts in Indianapolis, Indiana (USA).
Cummins employees made a strong showing Saturday (June 9) at the Indy Pride Parade and Festival in Indianapolis, Indiana (USA), joining a number of other companies in the city demonstrating their support for the LGBTQ+ community as well as diversity and inclusion in general.

The event drew thousands of people downtown on a brilliant sunny day interrupted briefly by a spring storm. Cummins employees are also marching in pride parades in Charleston, South Carolina; Minneapolis, Minnesota and Nashville, Tennessee in the United States as well as Vancouver and Calgary in Canada, Brazil, India and Asia Pacific.

“This is important to me because, first, I’m the co-sponsor of the Pride Affinity Group and it’s a wonderful group that I’m proud to support,” said Thad Ewald, Vice President – Corporate Strategy, shortly before he and the rest of the Cummins’ contingent marched in the Indianapolis parade. “But more importantly it’s a chance to show support for all of our LGBTQ+ employees and the LGBTQ+ community at large. This is just such a great turnout.”

Jasmine O’Conner, Marketing Specialist Sr – Senior Associate MSDP, and the lead organizer of Cummins’ parade involvement in Indianapolis, said about 400 employees signed up to participate in the parade and festival.

“It’s easy to classify the words diversity and inclusion as buzzwords; so many companies are using them nowadays,” said O’Conner, between passing out t-shirts and making sure the Cummins crowd stayed safe under the hot and humid conditions. “So, I’m happy to work for a company that puts actions to those words.”

Jasmine O'Conner at Indy Pride Parade
Jasmine O'Conner revs up the Cummins contingent at the Indy Pride Parade.

O’Conner, a member of her site’s Local Diversity Council, noted that Cummins’ mission, vision and values include both support for diversity and inclusion and a commitment to doing what you say you will do.

“It brings me so much joy to lead our company’s participation in an event that allows employees to celebrate who they are and feel the love and support from their counterparts, friends and family,” she said.

The participants from Cummins ranged from interns to senior leaders. Marchers included Amy Adams, Vice President – Strategic Initiatives; Mark Osowick, Vice President – Human Resources Operations; Jim Schacht, Executive Director – Marine and Oil and Gas Markets; Marina Savelli, Executive Director – Market Intelligence and Strategy, and Ian Kohen, Director of Corporate Responsibility and Diversity & Inclusion for Cummins Engine Business.

“I’m here because I’m a huge ally for the LGBTQ+ community,” said Kohen, who in addition to his work at Cummins serves on the Columbus, Indiana Human Rights Commission. “I’m here to show support for a huge population that hasn’t gotten a lot of support in the past.”

Many in the Cummins’ contingent said they have experienced the benefits of diversity and inclusion first hand and welcomed the chance to demonstrate their support in a fun setting outside of work.

“I’m here with my family because, for one thing, it’s a heck of a lot of fun,” Osowick said. “But the bigger reason is I believe in diversity and inclusion and what better way to show your support for our employees and the LGBTQ+ community than to come to a wonderful event like this. Who wouldn’t want to be part of this?”

The Cummins contingent at the Indy Pride Parade
The Cummins contingent marches at the Indy Pride Parade.


 

blair claflin director of sustainability communications

Blair Claflin

Blair Claflin is the Director of Sustainability Communications for Cummins Inc. Blair joined the Company in 2008 as the Diversity Communications Director. Blair comes from a newspaper background. He worked previously for the Indianapolis Star (2002-2008) and for the Des Moines Register (1997-2002) prior to that. [email protected]

They Are Still Manufacturing Jobs – Just Different

The plant floor at the Jamestown Engine Plant in Jamestown, New York (USA).
The plant floor at the Jamestown Engine Plant in Jamestown, New York (USA).
Manufacturing advances like robotics do not mean the demise of well-paying manufacturing jobs, but do require different skill sets and a commitment to lifelong learning, Cummins Chairman and CEO Tom Linebarger said Thursday (June 7) at a forum on advanced manufacturing and logistics.

New technology still has to be manufactured, maintained and programmed, which often requires workers develop new skills as technology evolves, Linebarger said at the forum in Indianapolis, Indiana (U.S.A.) The resulting efficiencies, however can translate into higher wages.

While a high school degree was once enough for a successful career in manufacturing, “it hasn’t been that way for a long time,” he said, citing the need for workers with two and four year degrees in manufacturing related studies.

Linebarger was participating in a panel discussion at the event sponsored by Conexus Indiana, a group dedicated to bringing manufacturing and logistics jobs to Indiana, and the Indianapolis Business Journal.

He was joined on the panel by Henry Maier, President and CEO of FedEx Ground; Brandye Hendrickson, Acting Administrator of the Federal Highway Administration; Lee Bauer, Vice President, Mobility Architecture Group, Aptiv; Darcy Bullock, Director of the Joint Transportation Research Program at Purdue University and Joe McGuinness, Commissioner of the Indiana Department of Transportation.

Advanced Manufacturing Breakfast
Cummins Chairman and CEO Tom Linebarger (center) at the Advanced Manufacturing & Logistics panel discussion, with Brandye Hendrickson, Acting Administrator of the Federal Highway Administration (left) and Henry Maier, President and CEO of FedEx Ground (right). 

INNOVATION VS. INFRASTRUCTURE

The panel discussed innovations such as driver-less vehicles, “platooning,” where trucks use smart technology to safely drive close together to increase fuel economy and decrease carbon dioxide, and alternative fuels such as electrification.

Linebarger, however, said infrastructure may be as big an issue as the advances themselves. A technological advance can be achieved by a single company relatively quickly, he said, but the infrastructure necessary to make it work effectively can require broad public support. Take roads, for example. There are many competing voices for the tax dollars necessary for road improvements.

Many of today’s innovations hold the promise of a cleaner, safer and more efficient world. Linebarger said sustainability is a key issue. Anything that uses more of the world’s resources isn’t likely to be successful.

“We have to have less impact on the world,” he said. “There’s just no question about it.”

Joe wins award
Former Cummins President and Chief Operating Officer Joe Loughrey (center) is presented the Andre B. Lacy award.

LOUGHREY HONORED

Former Cummins President and Chief Operating Officer Joe Loughrey was honored at the forum with the inaugural Andre B. Lacy Vanguard Award, named for the late Indianapolis businessman and philanthropist.

Loughrey retired from Cummins after 35 years in 2009. He was the founding Chairman of Conexus Indiana and serves today as Chairman of the Board of the Lumina Foundation, an Indianapolis-based foundation focused on increasing opportunities for learning beyond high school.

In a video message, Indiana Gov. Eric Holcomb paid tribute to Loughrey’s leadership, saying he has had “an enormous impact on our state.”

The Lacy award honors outstanding leadership in advanced manufacturing and logistics in Indiana.

 

blair claflin director of sustainability communications

Blair Claflin

Blair Claflin is the Director of Sustainability Communications for Cummins Inc. Blair joined the Company in 2008 as the Diversity Communications Director. Blair comes from a newspaper background. He worked previously for the Indianapolis Star (2002-2008) and for the Des Moines Register (1997-2002) prior to that. [email protected]

Cummins Posts 2017 Sustainability Progress Report

The 2017 Cummins Sustainability Progress Report includes a host of statistical data on the company's commitment to its stakeholders.
The 2017 Cummins Sustainability Progress Report includes a host of statistical data on the company's commitment to its stakeholders.
Cummins posted its 15th annual Sustainability Progress Report today, updating stakeholders on its performance in eight areas during 2017 including the environment, corporate responsibility, health and safety, and diversity and inclusion.

The 50-page report includes a host of statistical information, ranging from how the company is doing relative to its environmental goals and the number of people served by Cummins’ community engagement efforts to key safety rates, the percentage of women leaders at the company, the record number of global patents the company received in 2017 and much more.

“We think that the communities in which we live and work and operate need to be stronger and more prosperous as a result of us being there,” Cummins Chairman and CEO Tom Linebarger recently told the Environmental Defense Fund’s Fred Krupp for the group’s +BUSINESS blog. “Therefore, we can't just take and use resources – we need to be people who, while we create wealth, also sustain and contribute to those communities.”

Cummins is helping an Indiana wind farm expand
Cummins helped an Indiana wind farm expand in  2017, eventually producing enough energy to offset all of the electricity used at the company's Indiana facilities.

Some of the key takeaways in the 2017 report include:

  • Cummins moved within three percentage points of its products in use environmental goal, partnering with customers to reach an annual run rate reduction of 3.4 million metric tons of carbon dioxide. The company’s goal is to reach a 3.5 million run rate reduction by 2020.
  • Cummins’ Corporate Responsibility initiatives touched an estimated 3.3 million people, primarily through employee-led efforts addressing education, the environment and equality of opportunity.
  • Nearly 1,000 ergonomics improvements were made across the company in 2017.
  • Just over 23 percent of Cummins’ leaders are women, up from 16.42 percent in 2010.
  • The company has invested more than $700 million annually in research and development in four of the past five years.
  • Cummins new 1-800-CUMMINS customer support line fielded more than 380,000 calls in 2017.
AEOS shot at sunset
Cummins unveiled AEOS in 2017, a fully electric, heavy-duty demonstration truck that will help the company study electrification.

The Sustainability Progress Report is just one of the company’s reports regarding Cummins’ sustainability. The company is also working on the Cummins GRI Data Book, which follows the format of the United Nations’ Global Reporting Initiative. The company also makes public its CDP (formerly the Carbon Disclosure Project) water and climate filings. Those reports will be posted in June and July, respectively.

Cummins finished 25th in Newsweek’s 2017 Green Ranking of U.S. Companies and was named to the 2017 Dow Jones Sustainability Index for North America. Cummins has been on that list since 2006.
 

blair claflin director of sustainability communications

Blair Claflin

Blair Claflin is the Director of Sustainability Communications for Cummins Inc. Blair joined the Company in 2008 as the Diversity Communications Director. Blair comes from a newspaper background. He worked previously for the Indianapolis Star (2002-2008) and for the Des Moines Register (1997-2002) prior to that. [email protected]

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