America 250: Industrialization and the Rise of Small Manufacturers — Committee on Small Business and Entrepreneurship (May 13, 2026)
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- 2026-05-13
Summary
Supplementary written testimony of Edward (Ned) Hill, Professor of Economic Development Emeritus at The Ohio State University, submitted to the United States Senate Committee on Small Business and Entrepreneurship for its May 13, 2026 hearing America 250: Industrialization and the Rise of Small Manufacturers, and revised May 19, 2026. The testimony, titled Manufacturing's Role in Ohio's Economic Development, reports that manufacturing accounted for $137.9 billion of Ohio's gross domestic product in 2024 and that Ohio had 677,500 manufacturing jobs in 2025. It states that 88 percent of Ohio's 13,307 manufacturing establishments in 2023 employed fewer than 100 workers. It traces Ohio's industrial history from federal armories onward through a waves-and-bridges model, which is summarized in Exhibit A at the end of the testimony.
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“America 250: Industrialization and the Rise of Small Manufacturers — Committee on Small Business and Entrepreneurship (May 13, 2026).”
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United States Senate
Committee on Small Business and Entrepreneurship
Hearing:
America 250: Industrialization and the Rise of Small
Manufacturers
May 13, 2026
Revised May 19, 2026
Supplementary Written Testimony of Edward (Ned) Hill, Ph.D.
Professor of Economic Development Emeritus
John Glenn College of Public Affairs
Ohio Manufacturing Institute
The Ohio State University
Submitted in connection with oral testimony before the Committee on May 13, 2026
Edward (Ned) Hill is Professor of Economic Development Emeritus at The Ohio State
University’s John Glenn College of Public Affairs and a Senior Research Associate at the Ohio
Manufacturing Institute at Ohio State University. He is writing An Unending Transformation: An
Economic History of Ohio Manufacturing (manuscript in progress) with William Shkurti and Dr.
Fran Stewart, both affiliated with the John Glenn College of Public Affairs.
He has partnered with the Ohio Manufacturers’ Association for more than 25 years, beginning
with a 2001 examination of the importance of productivity and tax policy to Ohio’s manufacturing
base. He has worked with the OMA and its committees on workforce, energy, manufacturing,
and economic development policies. The OMA presented him with its Legacy Award for service
to Ohio’s manufacturers in 2005 and again in 2016.
Before coming to Ohio State in 2015, Ned was a faculty member at the Levin College of Urban
Affairs at Cleveland State University for 30 years. He was Dean of the Levin College from 2007
until 2015 and was named Professor of Economic Development Emeritus by Cleveland State
upon his departure in 2015.
Manufacturing’s Role in Ohio’s Economic Development
I. INTRODUCTION
Chair Ernst, Ranking Member Markey, and Members of the Committee, thank you for
the privilege of appearing before you in our 250th Year since declaring independence
from Great Britain. Today’s hearing is fitting: the republic was barely a year old in 1790
when President Washington, in his First Annual Address to Congress, called for
establishing an industrial policy as a foundation of national defense. That same year,
Samuel Slater brought the Industrial Revolution to Pawtucket, Rhode Island.
This written testimony draws on three bodies of work. The first is a book in progress, An
Unending Transformation: An Economic History of Ohio Manufacturing, which I am
writing with Dr. Fran Stewart and Bill Shkurti. The second is Ohio Manufacturers’
Association's 2025 Manufacturing Counts, a statistical compendium detailing Ohio
manufacturing's economic performance. The third is Joel Elvery's 2019 analysis of
occupational change in the United States from 1860 to 2015, published by the Federal
Reserve Bank of Cleveland.
Two disclosures. First, the historical analysis reflects the current state of my research
for An Unending Transformation and has not been peer-reviewed. Second, Wyatt
Newman, co-founder of RoadPrintz, Inc., discussed in Section V at length, is a close
friend. I disclosed this relationship in my oral testimony and do so again here. My
testimony does not represent the views of The Ohio Manufacturers’ Association, The
Ohio State University, or the Ohio Manufacturing Institute.
The argument developed across these sections is this: Ohio's manufacturing economy
was built on federal investment in manufacturing knowledge, beginning with President
Washington's defense-driven armory program, which matured and provided the
operations technologies and managerial practices that formed the foundation of what
became the American System of Manufacturing. That foundation sustained Ohio's
industrial might for more than a century. However, when the product cycle turned
against Ohio's core industries in the 1970s, the practices and products that had been a
source of strength became a source of economic weakness and social and political
rigidity. Ohio lost nearly 733,500 manufacturing jobs from its 1969 peak of 1,411,000 to
2025.1 Ohio’s entrepreneurs are now building the companies that will ride the next
manufacturing wave.
II. OHIO MANUFACTURING TODAY: SCALE, STRUCTURE, AND SUPPLY CHAINS
Ohio’s economy is best understood not as a manufacturing state or a farm state or a
services state, but as a portfolio economy—a diverse mix of goods and services
1 U.S. Bureau of Labor Statistics, All Employees, Manufacturing [MANEMP], retrieved from FRED,
Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/MANEMP, May 7, 2026.
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 2
produced across eight large regional labor markets and numerous smaller rural
communities. Manufacturing’s leading position within that portfolio is what makes Ohio’s
broader prosperity possible. Ohio’s manufacturing sector is, by any measure, a
dominant force in the state’s economy and a significant presence nationally.
As of 2024, manufacturing accounted for $137.9 billion of Ohio's gross domestic
product—16.5 percent of the state’s total and more than any other private industry. Real
estate and rental and leasing rank second at 11.7 percent; finance and insurance rank
third at 11.1 percent. Manufacturing's lead is not marginal; it is structural. Ohio ranked
fifth among all states in manufacturing GDP in 2024, trailing California, Texas, Illinois,
and Indiana—the last of which edged past Ohio by less than one billion dollars. Ohio's
manufacturing GDP has grown from $113.1 billion in 2021 to $137.9 billion in 2024, a
22 percent increase over three years.2
In 2025, Ohio had 677,500 manufacturing jobs, down from 687,345 in 2023. I present
the 2025 data for Ohio because it is the most recent available for the state. I then use
the 2023 data to compare Ohio with other states, as 2023 is the most recent year for
which comparative state-level data are available. In 2023, manufacturing jobs
accounted for 5.3 percent of all U.S. manufacturing employment. Only California and
Texas employ more manufacturing workers, and both states have substantially larger
total populations. Manufacturing represents 14.4 percent of Ohio's private-sector
employment, second only to health care and social assistance.
The sector generates $49.9 billion in total annual wages—more than any other Ohio
industry—and average annual pay of $76,493 is well above the statewide private-sector
average of $65,536. Average manufacturing pay grew 9.3 percent in 2023 alone. Ohio
manufactures and exports $55.8 billion in goods annually to 210 countries and
territories, with industrial machinery leading at $9.6 billion, followed by vehicles and
parts at $8.6 billion and aircraft and parts at $5.1 billion. Canada and Mexico together
account for more than half of Ohio's manufactured exports—a trade relationship whose
stability directly affects Ohio manufacturing employment.
The Small Manufacturer
These aggregate figures are important yet incomplete. The feature that most defines
Ohio's manufacturing economy is not the size of its anchors but the density of its
smaller firms.
Of Ohio's 13,307 manufacturing establishments in 2023, 88 percent employed fewer
than 100 workers. Nearly 45 percent—5,987 establishments—employed fewer than 10.
Yet large and small manufacturers are not independent actors; they are linked by supply
chains that determine the viability of both. Honda, GE Aerospace, Whirlpool, Lincoln
2 Ohio Manufacturers’ Association, 2025 Ohio Manufacturing Counts. (Columbus: OMA, 2025). Data
sourced from the U.S. Department of Commerce Bureau of Economic Analysis and U.S. Department
of Labor Bureau of Labor Statistics. All statistics in Section II are drawn from this publication unless
otherwise noted.
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 3
Electric, Goodyear, and Cleveland-Cliffs are a few of Ohio’s manufacturing anchor
businesses—but anchors need chains. The fabricated metal shops, precision machining
firms, plastics and rubber producers, specialty chemical manufacturers, and component
suppliers that populate Ohio's supply chains are the businesses that make the anchors
viable.
The employment multiplier in manufacturing is the highest among sectors. When a large
Ohio plant thrives, dozens of smaller suppliers, logistics firms, maintenance providers,
and business services firms thrive alongside it. However, when an anchor plant closes,
firms in its supply chain feel the blow before unemployment statistics reflect the loss.
The county-level distribution of manufacturing employment in Ohio is illuminating.
Cuyahoga County led in the absolute number of manufacturing jobs at 65,418, followed
by Hamilton at 49,181 and Franklin at 36,207. However, the counties with the highest
manufacturing employment shares are not large urban counties. Shelby County leads
with 46.5 percent of all manufacturing jobs, followed by Auglaize at 39.0 percent,
Williams at 38.2 percent, and Holmes at 36.8 percent. These are small counties whose
economies rely on manufacturing—and whose manufacturers are overwhelmingly
small.
III. HOW OHIO GOT HERE: DEFENSE POLICY AS INDUSTRIAL POLICY
Ohio entered the Union in 1803 as a pre-industrial frontier territory. By 1850, Cincinnati
was the nation's third-largest manufacturing city, behind only New York and
Philadelphia. From 1850 to 1870, Ohio ranked fourth in manufacturing employment,
behind New York, Pennsylvania, and Massachusetts. From 1880 to 1920, the state
ranked fifth, with Illinois outpacing Ohio. In 1930, Ohio climbed to fourth as New
England's industrial base began to fade. Understanding how that transformation
occurred illuminates the conditions under which manufacturing economies develop and
the role federal policy plays in shaping them.
My co-authors and I call the analytical framework we developed to understand Ohio’s
and the nation’s industrial transformation the waves-and-bridges model of industrial
evolution. We used the model to summarize Ohio’s industrial history in Exhibit A, which
appears at the end of this testimony. The exhibit’s first column names each wave and
bridge; the second lists the years they occurred; and the third notes the forces and
outcomes associated with each.
Rather than describing industrial history as a sequence of revolutionary industrial
ruptures, the model portrays industrial development as a continuous evolutionary
process driven by changes in five distinct forces: operations technology (OT),
management practices (MP), military-to-manufacturing transfers (MM), information
systems that integrate knowledge of shop-floor operations—inputs, outputs, and
equipment performance (IK), and the product cycle (PC). Each wave is a period of
broad diffusion; each bridge is a transition period during which a new capability exists
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 4
but has not yet been codified into forms that most manufacturers can adopt. In most
waves, the federal government seeded new manufacturing capabilities, while private
enterprise diffused them.3
President Washington's Defense and Industrial Policy
In his First Annual Address to Congress on January 8, 1790—thirteen years before
Ohio became a state—President Washington explicitly called for the promotion of
domestic manufacturing.4 His argument was not economic; it was military. Writing of "[a]
free people," Washington told Congress that "[t]heir safety and interest require that they
should promote such manufactories as tend to render them independent of others for
essential, particularly military, supplies."
President Washington's first policy proposal to Congress was to build American
industry; it was the nation's first industrial policy. A republic dependent on foreign
suppliers for its arms could not defend itself. That logic led to the federal armories:
Springfield in Massachusetts, established in 1794, and Harpers Ferry in Virginia,
established in 1798. Both were federal military installations built to arm the republic.
The War of 1812 and Its Consequences
The fragility of President Washington’s vision was exposed within two decades. During
the War of 1812, American forces struggled with weapons of inconsistent quality and
with supply chains dependent on European imports. The national humiliation culminated
on the night of August 24, 1814, when British forces marched into Washington and set
fire to the Capitol and the White House.
The lesson was unambiguous. The United States could not rely on imported arms,
imported technology, or imported manufacturing knowledge. What followed was a
systematic federal commitment to developing American production capability—not
merely producing weapons, but developing the methods by which weapons made from
interchangeable parts could be produced reliably, consistently, and at scale.
At Harpers Ferry, John Hall developed what his contemporaries recognized as a novel
system: rigid gauging and fixture design that ensured parts were interchangeable, not
because a skilled craftsman made them so, but because the system made it impossible
for them to be otherwise. That knowledge resided in the gauge, not the machinist. At
Springfield, Superintendent Roswell Lee built the management counterpart to Hall’s
operations technology: systematic cost accounting and inspection, coupled with a
hierarchical organizational structure that Alfred D. Chandler, Jr., assessed in his
pathbreaking book, The Visible Hand, as the most sophisticated management controls
in any American industrial establishment before the 1840s.5 Lee’s system tracked
3 Hill, E., Shkurti, W., & Stewart, F. (in progress). An Unending Transformation: An Economic History. The
waves-and-bridges model of industrial evolution is explained in the book’s appendix.
4 Washington, G. (1790, January 8). First Annual Address to Congress. Retrieved from The American
Presidency Project: https://www.presidency.ucsb.edu/documents/first-annual-address-congress-0
5 Chandler, A. D., Jr. The Visible Hand. (Harvard University Press, 1977), pp. 73-75.
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 5
objects and products rather than human performance. Two West Point-trained officers
completed what Lee had begun: Daniel Tyler prescribed time-based performance norms
in 1832; James Ripley enforced them from 1841 onward.6 These were organizational
innovations as much as technical ones, and their impact on American industry
exceeded their military application.
The American System Crosses the Mountains
By 1851, The Times of London had dubbed what American manufacturers
demonstrated at the Crystal Palace Exhibition the “American System of Manufactures.”
What distinguished it from European craft production was the integration of precision
tooling, interchangeable components, and systematic management—the convergence
of Hall’s operations technology and Lee’s management practices, which other
manufacturers used to produce other products. Hartford’s Colt demonstrated his
revolver; Windsor, Vermont’s Robbins & Lawrence demonstrated military rifles made
using Springfield’s methods; and New York City’s Alfred C. Hobbs demonstrated
unpickable padlocks.7
That system crossed the Appalachian Mountains in the heads and hands of mechanics.
Their work is visible in the precision-machined components of Whiteley's Champion
Reaper in Springfield, Ohio; in the lock mechanisms of Hamilton's safe industry; in John
Parker's steam engine castings at the Phoenix Foundry in Ripley; and in Thomas
White's sewing machines in Cleveland. These were small manufacturers who applied
systematic methods to new products in a new market—the direct ancestors of the small
manufacturers this Committee is convened to support.
Each generation built on the one before it. Ohio's machine tool builders—Warner &
Swasey in Cleveland, Cincinnati Milling Machine Company, and Lodge & Shipley in
Cincinnati—gave Ohio’s factories the capacity to cut, shape, and stamp steel at scale.
When Henry Ford introduced the moving assembly line at Highland Park in 1913, Ohio's
machine tool industry was positioned to supply the precision components mass
production demanded. The relationship was not accidental: Ohio's machine tool builders
had spent decades developing the production methods that made Ford's system
possible.
The breadth of Ohio's industrial base at the dawn of the twentieth century was evident
at the Ohio Manufacturers' Association's founding meeting in November 1910,
convened by Colonel J.C. Battelle of Columbus Iron and Steel. The sixteen companies
that sent representatives—from Jeffrey Manufacturing's coal-mining machines in
Columbus to C & G Cooper's steam engines in Mount Vernon, from Niles Tool Works'
heavy railroad machinery in Hamilton to Lodge & Shipley's precision lathes in
6 Hoskin, K. & Macve, R. (1988). The Genesis of Accountability: The West Point Connections. Accounting
Organizations and Society, 13(1): 37-73.
7 Smith, M. R. (1977). Harpers Ferry Armory and the New Technology. Ithaca, NY: Cornell University
Press, p.19.
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 6
Cincinnati—spanned the state and the full range of Ohio's industrial economy. In their
time, they were among the state’s manufacturing anchors.
Wilbur Thompson, a founder of urban and regional economic development, distilled the
logic of what that industrial base implied into a single sentence: "Tell me your industries,
and I will tell your (immediate) fortune."8 He could have said it in Ohio in 1910 and been
right. He said it in Detroit in 1968 and was right, though the implications were very
different as the product cycle began its descent.
IV. WHEN THE PRODUCT CYCLE TURNED
The same industrial depth that made Ohio a manufacturing powerhouse for a century
also left it vulnerable when the product cycle shifted. Understanding that vulnerability—
and its mechanism—is essential to evaluating current policy options.
Joel Elvery's 2019 analysis of occupational change in the United States from 1860 to
2015, published by the Federal Reserve Bank of Cleveland, provides a precise measure
of how manufacturing economies adapt over time. Using the index of dissimilarity to
measure the share of workers who would need to change occupational groups for the
distribution of occupations to match that of ten years prior, Elvery constructed state-
level occupational change indexes spanning 15 decades.9 Ohio entered the Civil War
as the fourth-largest manufacturing state in terms of employment and value added.10
Ohio's pattern is instructive. Across the 15 periods Elvery analyzed, Ohio's occupational
change index was in the lowest quartile in six periods and in the second-lowest quartile
in five others. Across the entire 155-year span of the study, Ohio's index never reached
the top quartile. In 2015, Ohio ranked 47th among the 50 states, with an index of 4.2
percent—meaning fewer than 5 workers in 100 would need to change occupational
groups to make Ohio's 2015 occupational distribution match that of 2005. The national
average over the study period was 6.8 percent. This is occupational stability quantified.
The stability reflected the depth and density of Ohio's occupational specialization in
manufacturing. A state whose economy is organized around interlocking industrial
clusters developed an occupational structure that is highly stable precisely because the
industries are so interdependent. Workers, employers, educational institutions, and
communities all specialize. The system becomes, in a word, locked-in.
8 Thompson, W. R. “Internal and External Factors in the Development of Urban Economies.” in Issues in
Urban Economics, ed. Harvey S. Perloff and Lowdon Wingo (Baltimore: Johns Hopkins University
Press for Resources for the Future, 1968), pp. 43–61, at p. 46,
9 Elvery, J. A., “Changes in the Occupational Structure of the United States: 1860 to 2015,” Economic
Commentary 2019-09 (Federal Reserve Bank of Cleveland, June 26, 2019). All occupational change
statistics in Section IV are drawn from this source.
10 New York, Pennsylvania, and Massachusetts were first through third, each employed over 215,000
workers; Ohio led the second tier at 75,602. Source: U.S. Census of Manufacturers, decennial years
1850–1950..
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 7
In good times, that lock-in is a source of strength. Ohio's industrial clusters generated
productivity gains, knowledge spillovers, and supply-chain efficiencies that sustained
competitive advantage for decades. But when the product cycle turned—when steel,
autos, machine tools, tires, and appliances simultaneously entered the mature and
declining phases of their competitive arcs—the same lock-in that had been an
advantage became a source of rigidity. Ohio lost 789,400 manufacturing jobs between
1969 and 2010, a decline that accelerated in the 1980s and deepened during the China
shock of the early 2000s.11
Ohio's highest-ranking occupational change index in Elvery's study—7.4 percent,
ranked 19th in 1990—reflects not successful adaptation but dislocation. The large shift
out of production occupations and into healthcare and management was the labor
market's response to plant closings and corporate restructuring; it was not a planned
economic transition.
The communities that housed those workers reeled from the shock of dislocation.
Former industrial strongholds—Youngstown, whose steel industry collapsed; Akron,
which lost its rubber industry; and Dayton, which watched its manufacturing base
contract across multiple sectors—experienced population loss, fiscal stress, and erosion
of social infrastructure that follow concentrated economic decline. In 1961, Benjamin
Chinitz observed that a region’s industrial composition shapes its capacity for self-
renewal for generations.12 Ohio's experience confirmed this: regions most dependent on
a single dominant export industry or on portfolios of uniformly aged products were the
least able to counter the contraction. Central Ohio, centered on Columbus, with a
deliberately diversified portfolio of products and services, serves as the counterfactual.
Product portfolio diversity is not a luxury for regional economies; it is a necessity.
V. OHIO'S NEXT WAVE: FOUR CASE STUDIES
Ohio’s entrepreneurs are not standing still. The same blend of invention, tinkering,
entrepreneurial ambition, and manufacturing craft that carried the American System
over the Appalachians is now fueling the companies driving the next manufacturing
wave.
RoadPrintz, Inc. — Cleveland
RoadPrintz was founded in Cleveland in 2017 by Wyatt Newman, a Case Western
Reserve University robotics professor, and Sam Bell, a master mechanic who closed his
memorably named auto repair shop (the Lusty Wrench) to devote himself full-time to
11 1969 was the year of peak manufacturing employment in Ohio and 2010 was the low point.
Manufacturing employment in 2025 was 677,500. U.S. Bureau of Labor Statistics, All Employees,
Manufacturing [MANEMP], retrieved from FRED, Federal Reserve Bank of St. Louis;
https://fred.stlouisfed.org/series/MANEMP, May 7, 2026.
12 Chinitz, B. (1961). Contrasts in agglomeration: New York and Pittsburgh. The American Economic
Review, 51(2), 279–289.
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 8
their venture.13 Their product is an operator-driven, truck-mounted robotic road-marking
system: a robotic arm mounted on a Ford F-550 truck, controlled entirely from within the
cab, that paints pavement markings—turn arrows, crosswalks, bike lane symbols,
legends, and school zone markings—with precision, consistency, and speed that
manual stencil crews cannot match, without putting workers on the pavement.
RoadPrintz’s founding is a 21st-century story of a small manufacturer. Newman and Bell
started with a loaned robot from Motoman, a robotics company based in Dayton, Ohio.
Motoman’s head of business development listened to their pitch and extended credit to
a two-person startup. Heavy fabrication—the steel platform, welding, and truck
upfitting—was performed by Q.T. Equipment, an Akron-based company owned and
operated by the Root family, who also invested in the company and loaned the founders
their first truck. The paint RoadPrintz now uses—AquaTough, a water-cleanup
thermoplastic-grade paint—is manufactured by Aexcel in Mentor, Ohio. The Ohio supply
chain did not merely support RoadPrintz; it made RoadPrintz possible.
RoadPrintz operates out of an incubator retrofitted within Cleveland’s former White
Motor Company plant—a massive facility built in the early twentieth century to
manufacture trucks at scale. Now, it houses a digitally integrated robotics company that
is a physical embodiment of the argument this testimony makes: each wave of
American manufacturing builds on the last, and the next wave is already under
construction in Ohio.
Early growth depended on federal grant support. RoadPrintz received approximately $2
million in competitive grants, including NSF Small Business Innovation Research Phase
I and Phase II awards, which funded research and development and the development of
a prototype. NSF SBIR funding was essential to RoadPrintz's early development. The
company now has five full-time employees, five awarded patents developed in
collaboration with Case Western Reserve University, and paying customers, including
the Missouri Department of Transportation and the city of Houston.
The Value Proposition They Didn't Know They Had
RoadPrintz's founders understood their product's advantages in efficiency and
precision. What they did not fully appreciate—until a user told them—was the product's
true value proposition. A Cleveland public works employee described its value in
simpler, clearer, and more powerful terms than any market analysis after spending a
day driving the truck and painting lines. His wife liked it when he was inside the cab
painting instead of walking next to traffic, because she knew he would be coming home
that night.
13 The material on RoadPrintz comes from its website and conversations with its founding Chief
Technology Officer, Wyatt Newman. Also see: https://www.cleveland.com/news/2025/09/how-a-cwru-
prof-and-a-local-mechanic-created-a-robotic-system-to-make-road-painting-safer.html and
https://www.cleveland.com/news/2025/10/no-stencils-no-large-work-crews-cleveland-startup-unveils-
road-painting-robot.html
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 9
RoadPrintz built a robotic street-painting system that was a worker-safety device. The
inventors learned this from the person who drove the truck and operated its robotic arm.
The Missouri Department of Transportation (MoDOT) first engaged RoadPrintz after
learning about the company’s 2024 American Traffic Safety Services Association
Technology Innovation Award.14 MoDOT is a department at the leading edge of
adopting technology to advance worker safety—the kind of agency that takes its
obligation to send workers home at night seriously. When the RoadPrintz team traveled
to St. Louis to work with MoDOT, they encountered a memorial honoring colleagues
killed in the line of duty. That memorial made real what accident statistics express in the
abstract: road marking requires workers to operate in or adjacent to live traffic for
extended periods, and accidents and deaths do occur. They are not necessarily the
result of inadequate safety practices at any agency; they are inherent in the
conventional way roads are stripped. MoDOT was not operating below the industry
standard, and today it is operating at the industry’s safety frontier, raising that standard
by example.
Economists rely on revealed preference to gauge what people and organizations
actually value—not what they say they value—by observing their actions. MoDOT has
revealed its preference unambiguously. After losing two team members to traffic-related
deaths in the line of duty, MoDOT found RoadPrintz, purchased two trucks at $500,000
each, and is considering a third. A state agency that spends a million dollars on a
technology specifically to keep its team members out of live traffic is not making a
rhetorical point. It is making an economic one: the value it places on its workers’ lives
exceeds the cost of the equipment. That is what revealed preference means. No
productivity metric captures it, but every purchase decision reflects it.
Path Robotics — Columbus
Path Robotics, headquartered in Columbus, was founded in 2018 by brothers
Andy and Alex Lonsberry while they were completing their doctoral work at Case
Western Reserve University in Cleveland. The company began in a basement shop at
CWRU and gained critical early traction in July 2018 by winning a pitch contest
sponsored by MAGNET—the MEP center serving Northeast Ohio. The win provided
rent-free office space near Cleveland State University and industry connections that
helped the company survive its earliest stage. Path relocated to Columbus in 2019,
drawn by access to Ohio State University’s engineering talent pool, and has since
become one of Ohio’s most significant advanced manufacturing companies.
The problem and the technical solution
Path Robotics addresses one of American manufacturing's most quantifiable workforce
crises: the shortage of skilled welders. The American Welding Society projects a
shortage of approximately 400,000 welders—a gap estimated at $26 billion in unmet
14 Robotic Pavement Marking System Earns Innovation Award at ATSSA Convention and Traffic Expo,
February 6, 2024. https://www.atssa.com/news/robotic-pavement-marking-system-earns-innovation-
award-at-atssa-convention-traffic-expo/
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 10
manufacturing capacity annually.15 Path's response is Obsidian™, a proprietary
physical AI application trained on millions of inches of real welds. It uses advanced
vision and machine learning to perceive the weld environment and adapt in real time—
without requiring pre-programmed paths or CAD files. Unlike conventional industrial
robots, which can only repeat exactly programmed sequences, Path's systems handle
fit variations, complex joints, and varying materials that make finish welding notoriously
resistant to automation. The result is a welding cell that, in Path’s experience, delivers
four times the productivity of manual welding at more than 30 percent lower cost, while
redeploying skilled welders to more complex work that most requires human craft.
The business model
The company has raised more than $300 million in venture capital, including a $100
million Series D in 2024.16 Rather than selling capital equipment—a barrier that puts
automation out of reach for smaller manufacturers—Path delivers its systems through
Path Foundry™, an outsourced contract manufacturing entity, or through its main
business, RaaS, which provides welding as a service at customers’ plants.17
The Washington connection
Path's recent defense contracts echo President Washington's original argument. In
1790, President Washington argued that American security required American
manufacturing capability. In early 2026, Path signed an agreement with HII—the
nation's largest military shipbuilder—to integrate its autonomous welding technology into
naval shipbuilding operations. The underlying AI—the vision systems, machine learning
models, and software stack—is designed and built in Columbus, Ohio. Path Robotics is
building that capability for the twenty-first century.
IC3D — Columbus
Michael Cao spent his engineering career at Honda, contributing to the design of the
Acura NSX.18 His exposure to additive manufacturing there sparked a question he could
15 American Welding Society. (2022). Welding workforce data: Analysis of the 2022-2026 outlook. AWS
Foundation; Tasch, J. (2015). Addressing the welding shortage through education and
automation. Welding Journal, 94(10), 32–35; and Path Robotics, "Physical AI for Manufacturing: The
Welder Shortage Crisis," 2024/2025.
16 Path Robotics. (2024, October). Path Robotics raises $100M Series D to transform manufacturing with
AI-powered robotics [Press release]. https://www.path-robotics.com/news; Crowe, S. (2024, October
23). Path Robotics secures $100M for autonomous welding expansion. The Robot Report.
17 Path describes its welding as a service subscription model as an alternative to buying equipment. A
subscription bundles its intelligent welding cell hardware, software, maintenance, and support into a
single service so manufacturers can access the latest automation technology without the risk and
complexity of ownership. See: https://www.path-robotics.com/blog/what-is-raas-a-guide-to-robots-as-
a-service-for-welding-automation Path Foundry describes its technology and process in:
https://www.einpresswire.com/article/749791309/path-robotics-unveils-path-foundry-a-new-frontier-in-
contract-manufacturing-welding
18 Information on IC3D came from the company’s website: https://www.ic3dprinters.com , Columbus CEO
https://www.columbusceo.com/story/business/briefs/2025/01/04/dublin-based-ic3d-expands-its-
printing-business-to-include-research-development/77448029007/ Columbus Dispatch:
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 11
not shake: why was 3D-printer filament—the consumable every printer requires—still
produced mainly for industries whose specifications were entirely different from his
own? No one had made it specifically for precision manufacturing applications.
Cao founded IC3D in 2012, starting in his Columbus basement with support from Ohio
State University’s engineering community. Today, IC3D manufactures production-grade
thermoplastic filaments, operates a large-format contract manufacturing service, and
builds its own industrial Virago printers—with a print chamber four feet on each side,
large enough to enclose a small car.
IC3D's customers span the automotive, defense, aerospace, utilities, and consumer
products sectors. Its customers include Ford, Goodyear, NASA, Boeing, all three
military services, American Electric Power, Procter & Gamble, and Timken. IC3D holds
a Department of Defense CAGE code and is a member of America Makes, the national
additive manufacturing institute. It is a supply chain company for the next manufacturing
wave—producing the materials and providing the production capacity other
manufacturers need to adopt additive manufacturing.
M-7 Technologies — Youngstown
Youngstown, Ohio, is often cited as the poster child for American deindustrialization.
When Youngstown Sheet & Tube’s Campbell Works steel mill closed in 1977, it put
5,000 people out of work, triggering a cascade of layoffs throughout the Valley.
Bluestone and Harrison estimated that the closure removed “$32 million from the public
treasury” and another $34 to $38 million in unemployment and relief programs over
three years.19 Among the businesses that nearly failed was a bronze foundry started in
1918 by Michael Garvey’s grandfather to serve the twenty-three independent
steelmakers operating within 400 to 500 miles of Youngstown. His grandfather built a
prosperous enterprise serving primary metal producers. Then, in the 1980s, the steel
industry collapsed.
Michael Garvey returned from Wall Street in 1985, at age 24, after his father fell
critically ill. He inherited an insolvent company. A fire then destroyed the foundry. What
remained was a machine shop with three employees. He decided not to rebuild the
foundry. Instead, he studied what the machine shop could become. The transformation
began with measurement.
Garvey recognized that precision measurement was the foundation of any effective
machine shop—an insight that, a century and a half later, echoes the quality-control
gauges John Hall developed at his Harpers Ferry Rifle Works. Even when the M-7 could
barely afford them, Garvey invested in digital measurement technologies and built that
https://www.dispatch.com/story/business/information-technology/2020/01/19/3-d-printing-industry-
more/1845980007/ America Makes: https://www.americamakes.us/shaping-the-future-of-am-ic3ds-
impact-on-sustainability/ and You-Tube: https://www.youtube.com/watch?v=_6rleEB_oEk&t=16
19 Bluestone, B. & Harrison, B. (1982). The Deindustrialization of America. New York: Basic Books. p. 75.
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 12
capability into a business model focused on extending the service life of precision parts
for industrial customers. It took ten years to turn the company around.
Today, Garvey operates three interconnected companies. M-7 Technologies is a
manufacturing engineering research company specializing in portable coordinate
measurement and on-site measurement services. M-7 measures parts or components
in place, whether machines are shut down or engaged in manufacturing and
processing. Instead of removing massive industrial parts from machines and
transporting them to a specialized quality-control lab, M-7’s technology enables
measurement of a part in place on the production floor or inside the machine.
Grale Technologies provides digital measurement services, while Center Street
Technologies operates one of the world’s largest 3D printers. The printer is large
enough to park a pickup truck inside. The printer was constructed using additive
manufacturing technology developed by Strangpresse, a Youngstown company
founded in 2014.20 Center Street’s 3-D printer builds components at micron-level
tolerances for aerospace and defense customers.
Garvey’s companies are supported by America Makes, the national additive
manufacturing institute headquartered in Youngstown and funded in part by the federal
government as a Manufacturing USA institute.
Garvey memorably describes his shop floor as a place where the Flintstones meet the
Jetsons. The first object he printed on (what was then) the world’s largest 3D printer
was a bridge; it was a deliberate choice. His company had evolved from a family
foundry serving steel mills into a digital manufacturing enterprise producing precision
components for aerospace customers. For Garvey’s team, the bridge was symbolic; it
connected where Youngstown had been to where it is going. Over 35 years, the
companies have grown from three employees to fifty, with revenue increasing by
approximately 18 percent annually.
The transformation did not happen in isolation. MAGNET—the Manufacturing Extension
Partnership center serving Northeast Ohio—provided technical assistance, industry
connections, and access to collaborative networks that Garvey credits with being
essential to navigating Industry 4.0. M-7's story is, in part, about what the MEP makes
possible—and what manufacturers like Garvey stand to lose if the program is shut down
or starved for funds. Garvey draws a broader lesson from his own transformation:
“Manufacturing is not a solo sport.” Collaborations with MAGNET, research
organizations, and other manufacturers opened doors to expertise no small company
could have assembled on its own.
Ohio is now home to three of the country’s most significant industrial additive
manufacturing facilities: Center Street Technologies in Youngstown, whose printer is
large enough to park a pickup truck inside; IC3D in Columbus, whose Virago printers
20 https://strangpresse.com
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 13
measure four feet on each side and can fit an automobile; and GE Aerospace’s Additive
Technology Center in West Chester—near Cincinnati—which operates nearly 90 metal
printers, including six of the largest in the world, producing parts for the GE9X, the
world’s largest jet engine. President Washington’s vision of American manufacturing
independence has found a twenty-first-century expression in Ohio. Together,
RoadPrintz, Path Robotics, IC3D, and M-7 Technologies illustrate the breadth of Ohio’s
next manufacturing wave. RoadPrintz is a startup that built a digital production system
that removes workers from the most dangerous exposure in their occupation. Path
Robotics is a venture-backed company deploying AI to address a critical workforce gap.
IC3D is a former Honda engineer’s basement idea that became a Department of
Defense-certified supplier of additive manufacturing materials and equipment. M-7 is a
century-old family business that reinvented itself with digital technology and is now
competing for aerospace and defense contracts from Youngstown. All four were built on
Ohio’s research capacity and Ohio roots. All four relied on federally funded services at
critical stages. All four compete in national markets.
VI. INDUSTRIAL EVOLUTION AND OHIO’S NEXT WAVE
The diffusion of advanced manufacturing technology is driven by competitive demand
and technological necessity. Consider two five-axis CNC machines operating in Ohio
just before the Great Recession—arguably the most precise computer-controlled
machine tools available at the time. One was at GE’s jet engine facility in Evandale,
producing blisks—bladed turbine disks whose complex aerodynamic geometries cannot
be machined any other way. The other was in Holmes County, in the heart of Ohio’s
Amish and Mennonite furniture country, where today numerous suppliers operate 3- and
5-axis routers to carve ergonomically contoured seat blanks for smaller chair
assemblers across the region. They produce at volumes and tolerances no craftsman
with a scorp and a travisher could match, and at competitive prices. GE needed five-
axis capability to solve a physics problem. The Holmes County furniture shops needed
a supplier to solve a cost problem. Both followed competitive demand to the same
machine. Jet engines and chair seats. That is how technology diffuses in a
manufacturing economy.
The Five Disruptive Forces
The research behind An Unending Transformation identified five independent
variables—disruptive forces—that drive industrial evolution: changes in operations
technology (OT), management practices (MP), information and knowledge integration
(IK), military-to-manufacturing transfers (MM) of OT, MP, and IK, and the product cycle
(PC). MM and IK run throughout this testimony's historical account—Washington's
armories stimulated MM transfers; Hall's gauging system is an OT innovation; and the
accountability innovations developed in Springfield’s Armory were IK- and MP-driven
and used manual systems. The analysis below focuses on the forces most directly
relevant to current policy: the relationship between changes in operations technology
(OT) and management practices (MP) and the product cycle (PC).
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 14
These forces interact, and that interaction is a central finding of the research. OT acting
alone—new technology adopted without the management practices needed to harness
it—produces a productivity decline before any gain is realized. This is the Productivity J-
Curve, and it appears in every wave transition in the historical record. Springfield
Armory's real cost per weapon spiked to $113.57 in 1840 as Warner reorganized
production for the new model musket—a cost increase that preceded the savings that
interchangeable production eventually delivered.21 More than 170 years later, in 2016,
nearly two-thirds of surveyed manufacturers reported limited or negative results from
Industry 4.0 investments, not because the technology failed but because the
management practices needed to deploy it had not yet been codified.22 The pattern is
the same: new OT arrives, and performance falls before it rises. Cost spikes and
productivity shortfalls are not evidence of failure. They are the predictable costs of
reorganizing production around a system that had not yet matured and that relies on
either new products or new production processes.
The J-curve occurs for three reasons. First, technology arrives before its applications
are fully understood and codified. (Codification is the process that makes a technology
both productive and teachable.) Second, new OT is deployed before managerial
methods exist to deploy it effectively at scale. Third, new operations technologies follow
a cost-decline curve as they mature: as the technology stabilizes, demand grows, and
production scales up, the technology moves down its cost curve. Bridge 5.5—the
current transition to AI-enabled production systems—is moving down the same path.23
The product cycle operates differently from the other four forces. Its primary effect is on
the geographic distribution of production within an industrial era—or wave. When Ohio’s
steel, auto, rubber, and machine-tool industries entered late maturity at Bridge 4.5’s
arrival in the late 1960s and 1970s, the product cycle’s redistribution mechanism had
been in motion for more than a decade. The state lost 789,400 manufacturing jobs
between 1969 and 2010 because four dominant industries reached the same bridge at
the same time in late maturity.24 The structural advantages that had made Ohio a
21 Deyrup, F. J. Arms Makers of the Connecticut Valley. (Northampton, MA: Smith College Studies in
History, Volume XXXIII, 1948).
22 Breunig, M., Kelly, R., Mathis, R., & Wee, D. Industry 4.0 after the Initial Hype: Where Manufacturers
Are Finding Value and How They Can Best Capture It (McKinsey Digital, 2016). The survey engaged
300 industry experts in Germany, the United States, and Japan in January 2016. Among
manufacturers specifically, 63 percent reported no or only limited progress in implementing Industry
4.0 applications.
23 McElheran, K., Yang, M., Kroff, Z., and Brynjolfsson, E. (2025, April 20). The rise of industrial AI in
America: Microfoundations of the productivity J-curve(s). SSRN-5036270
24 U.S. Bureau of Labor Statistics, All Employees, Manufacturing [MANEMP], retrieved from FRED,
Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/MANEMP, May 7, 2026.
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 15
manufacturing powerhouse in Wave 3.0 became economic, social, and political rigidities
at Bridge 4.5. That is the Devil's Bargain.25
Five Mechanisms that Close Bridges
The research also identifies five mechanisms that cause bridges to close, moving
industries and their economic regions from one wave to the next, and causing some to
move, close, or go bankrupt while the survivors adapt. Competitive pressure and
deliberate action drive codification, which in turn results in diffusion, generalization, and
adaptation among existing products and the invention of new goods and services—
thereby closing the bridge. The length of a bridge depends on how well and how quickly
these mechanisms operate.
The first is the practitioner-innovator: Practitioner-innovators are individuals or teams
who translate what a new technology can do and how to integrate it into production into
a teachable, replicable form. Hall encoded the gauging principle into a system that any
trained mechanic could operate or adapt to produce at scale. Frederick Winslow Taylor
codified scientific management in written procedures and training systems. Taiichi Ohno
codified the Toyota Production System, turning lean production into a teachable
production system. Without this work, tacit knowledge remains tacit, and a bridge either
continues on or becomes a dead end.
The second is the training and extension network: a mechanism that widely
disseminates codified practices, reaching manufacturers who cannot implement them
on their own. The Springfield Armory served as a public demonstration site from 1830
until the Civil War—open to private manufacturers, sharing castings and machinery
designs, and training mechanics who first carried the American System throughout the
Connecticut and Naugatuck River Valleys, to Providence, Rhode Island, and then
westward into Ohio and the other states between New York and the Mississippi River.
The Manufacturing Extension Partnership (MEP) and the Cooperative Extension
Service are contemporary equivalents of the Springfield Armory: both address the same
diffusion problem using the same organizational logic. The MEP primarily deploys
operations technology and shop-floor practices, while the Cooperative Extension
Service deploys operations technology, management practices, and knowledge
integration across the full agricultural enterprise. MAGNET, the MEP center serving
Northeast Ohio, provided the connection that launched Path Robotics from a CWRU
basement in 2018 and the technical assistance that helped rebuild M-7 Technologies
from a three-person machine shop into a digital manufacturer competing for aerospace
and defense contracts. These are not anecdotes. They are the mechanism of bridge
closure at work today.
25 The Devil's Bargain and Its Aftermath: Industrial Evolution and the Future of American Manufacturing is
a working paper from the research I am conducting with my colleagues on industrial evolution.
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 16
The third is patient capital: funding that sustains development and codification until a
process achieves commercial viability. No private manufacturer had the capital or
patience to fund the twenty-four years of investment between Hall’s proof of concept in
1825 at his Harpers Ferry Rifle Works and Buckland’s achievement of production-level
interchangeability in 1849–50 in Springfield. The Ordnance Department provided that
patience.
The approximately $2 million in NSF SBIR funding that supported RoadPrintz from 2017
to 2025 helped build a five-person company with five patents, paying customers in
multiple states, and a product that keeps workers alive—a manufacturing enterprise that
early-stage private capital would not have been willing to seed at the company’s
founding. In 2025 and 2026, the founders became confident they had reached the end
of a start-up’s journey through the Valley of Death and had established commercial
viability.
The fourth are procurement mandates: Purchasers require the use of specific OT and
production processes as a condition of sale. These mandates convert voluntary
adoption into required purchasing standards, transforming a practitioner-innovator’s
system into a standard that an entire network of suppliers must adopt. The Ordnance
Department required private arms contractors to adopt armory gauging standards as a
condition for awarding purchasing contracts. That requirement converted Hall’s
innovation from an experiment at Harpers Ferry into the American System of
Manufacturing.
The fifth is the practitioner fellowship: In sociology and economics, practitioner
fellowships are recognized as a form of weak-tie social capital. In economic
development, they are recognized as networks that facilitate the flow of tacit knowledge
between firms. This flow is a reciprocal exchange of operational knowledge among
practitioners who share a generalized production practice. Pratt & Whitney, Brown &
Sharpe, and the pre-Civil War Connecticut Valley machine tool cluster operated under
an open-door norm: If you could demonstrate competence on the shop floor, you would
receive a tour and a conversation in return. That fellowship is the last mile before
codification—where knowledge not yet written into a manual is taught through
demonstrations on shop floors. These exchanges will weaken, and proprietary
tradecraft will be hidden, as an industry’s OT, products, and markets mature, resulting in
market share and scale driving revenue, per-unit operating costs, and profitability.
An open-door norm prevailed in the Connecticut River Valley. There were no intellectual
property barriers and no non-compete agreements restricting practitioners’ movement
between firms. These social norms, reinforced by procurement mandates, transformed
individual practitioner-innovators into a regional economic cluster, providing a
competitive advantage that lasted another 100 years. What today’s economists would
recognize as a regionally thick occupational labor market supported by an open
knowledge network was built by the Superintendents at Springfield and the contracting
officers of the Ordnance Department. They lacked a theory to describe it, yet the result
was a dense concentration of specialized practitioners who freely exchanged
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 17
knowledge. The Armory was a publicly funded test kitchen open to observation. That
structure is what Enrico Moretti documented in Silicon Valley’s thick labor markets and
what AnnaLee Saxenian identified in Silicon Valley’s open network culture—in contrast
to Route 128’s closed, hierarchical firms, which ultimately lost the competition.
When the American System of Manufacturing developed between the burning of the
U.S. Capitol in 1814 and the Confederate Army’s stripping of the Rifle Works and
Armory of its equipment in 1861, the comparison was between the technology,
management, and operating practices in the Armories in Harpers Ferry and Springfield.
Harpers Ferry was embedded in craft-based production augmented by machines, while
Springfield developed machine-based production augmented by craftsmen. One
produced rifles from interchangeable parts, the other did not; one could produce at
scale, the other could not; one won the Civil War, the other did not; and each had the
potential to be an anchor institution that seeded an economic cluster conferring
economic development and a century of competitive advantage by generating
knowledge spillovers—Springfield did, while Harpers Ferry did not.
Those spillovers created economic development and a lasting competitive advantage.
Where knowledge flowed freely among practitioners, bridges closed faster, and waves
were higher and arrived sooner. When tacit knowledge is locked behind intellectual
property restrictions and non-compete agreements, it remains tacit, and bridges take
longer to connect to the next wave, and the next wave takes longer to form.
Ohio’s Position in Bridge 5.5
Ohio enters Bridge 5.5 with real assets and real vulnerabilities. On the asset side: the
Honda-anchored lean supply base spanning the state’s auto supplier network; the
precision manufacturing heritage evident in GE Aerospace’s Additive Technology
Center in West Chester, Center Street Technologies in Youngstown, and IC3D in
Columbus; the university research capacity at Ohio State, Case Western Reserve, the
University of Cincinnati, and the University of Dayton, along with the state’s engineering
colleges; and a business network building Wave 6.0 capabilities from the ground up.
On the vulnerability side: 88 percent of Ohio’s 13,307 manufacturing establishments
employ fewer than 100 workers. These small manufacturers face the same Bridge 5.5
transition that large manufacturers navigate with engineering staff and capital budgets
that small firms lack. The Productivity J-Curve is real for them: adopting new OT without
codified management practices to deploy it produces cost spikes and productivity dips
before the system matures, and can break a company. The question is whether the five
mechanisms of bridge closure are operating effectively enough to close the bridge
before the product cycle completes the redistribution of Ohio’s current industrial base.
The case studies in Section V illustrate how bridge closure mechanisms work.
• RoadPrintz is a practitioner-innovator story: Newman and Bell encoded operator-
driven robotic road marking into a system that any trained road crew member can
learn in minutes.
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 18
• Path Robotics is a training-and-extension story that began with an MEP center’s
bet on two doctoral students. Path Robotics is now enabling AI-enabled welding
through Path Foundry, making it accessible to any manufacturer without upfront
capital investment.
• IC3D is a patient-capital and fellowship story: a Honda engineer who saw a
production problem built a solution and a company in his basement, with support
from Ohio State University’s engineering network, and then grew it into a
Department of Defense-certified supply chain company through the America
Makes network.
• M-7 is a fellowship story: Garvey’s account of M-7’s rejuvenation is that
manufacturing is not a solo sport; the collaborative networks he accessed were
as essential as his technology investments. The MEP provided technical
expertise, as did a grassroots peer network formed by local manufacturing
leaders who realized they would not be rescued from the Statehouse in
Columbus or from the corridors of Washington, D.C. A group of peers in the
Valley tackled their workforce challenges the same way. They founded the
Mahoning Valley Manufacturers Coalition, knowing that help would arrive only if
they could figure out how best to use external resources to educate and train a
new workforce and lead with their time and effort.
The historical pattern holds across Ohio’s manufacturing history. The federal
government seeds new manufacturing capabilities. Entrepreneurs and engineers codify
and diffuse them. Workers build them into competitive companies with pathbreaking
products. Their descendants are following in their footsteps and forging their future.
VII. CONCLUSION
President Washington’s armories did not merely produce weapons. They produced the
Springfield Armory, which became the seedbed of the American System of
Manufacturing and helped form the Connecticut River Valley manufacturing knowledge
cluster. The mechanics, machinists, and superintendents who passed through that
Armory formed what economists now call a thick labor market: a dense concentration of
specialized practitioners who exchanged knowledge across firm boundaries, without
intellectual property walls or non-compete agreements. The Armory operated as a
publicly funded applied engineering laboratory and production facility open to private
observation. The federal government did not build that economy. It built the anchor
institution that made economic development possible. The returns flowed outward—to
the cluster, to the region, to the nation—in ways no appropriations ledger could have
anticipated.
The mechanism is not unique to mid-1800s Springfield. It is what Enrico Moretti
documented in Silicon Valley’s dense labor markets and what AnnaLee Saxenian
identified in Silicon Valley’s open network culture—in contrast to Route 128’s closed,
hierarchical firms, which ultimately lost the competition. The anchor institution seeds the
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 19
cluster, which then generates spillovers that become the ingredients for new products
and new companies. Low-barrier access to knowledge—the open-door norm of the
Connecticut Valley machine shops, the America Makes fellowship, the MEP center’s
demonstration shop floor—is not a policy preference. It is the structural condition under
which economic development operates.
Ohio received that system in the heads and hands of mechanics who crossed the
Appalachians or navigated Lake Erie, translating that knowledge into machine tool
industries, steel mills, rubber plants, and automobile suppliers, and sustaining a middle
class for generations of Ohio workers. When the product cycle turned, the costs were
real and concentrated. Ohio’s communities bore them.
Ohio is now building the next cluster. RoadPrintz, Path Robotics, IC3D, and M-7
Technologies are not isolated success stories. They are a sample of the current
expression of a mechanism that the historical record has confirmed over nearly 200
years: anchor institutions seed the conditions; entrepreneurs, engineers, and workers
build the economy.
President Washington’s return on his armory investment extended beyond the
Ordnance Department’s ledger. It was the American System of Manufacturing, which
laid the industrial foundation of the republic. Ohio’s manufacturers built on that
foundation for more than a century, and their descendants continue to build on it.
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 20
EXHIBIT A
Waves and Bridges of Industrial Evolution in the United States: A Summary
From: Hill, Stewart, and Shkurti, An Unending Transformation (manuscript in progress).
Wave or Bridge Period Primary Forces & Defining Change
Pre-industrial Mills and To 1790 Water-powered mills and craft workshops. Knowledge is tacit;
Workshops markets are primarily local.
WAVE 1.0 — Industrial 1760s– Water and steam power (OT)
Revolution 1850s
Bridge 1.5a — Armories Bridge 1810s– Interchangeable parts, precision tooling, quality control (OT,
1850s MM, IK)
Bridge 1.5b — Civil War Bridge 1861–1865 Management of large organizations (MM, MP)
WAVE 2.0 — American System 1850s– Electricity, railroads, steel, the corporation (OT, MP, MM)
of Manufactures 1910s
Bridge 2.5 — Scientific 1890s–1913 Codification of production knowledge; time-and-motion study
Management Bridge (MP)
WAVE 3.0 — Mass Production 1913–1960s Assembly line; internal combustion engine; mass
consumer markets (OT, MP)
Bridge 3.5 — Chandler's Bridge 1920s– Divisional organization; scale and scope economies; WWII
1970s organizational surge (MP, MM)
WAVE 4.0 — Programmable 1969–1990s Programmable logic controllers; mainframe computing
Automation and early ERP (OT, IK)
Bridge 4.5 — Lean Management 1990s–2010 Toyota Production System codified and diffused; quality
Bridge management (MP, IK)
WAVE 5.0 — Digital OT 2000s– Internet-connected shop-floor systems; commoditized
Integration ongoing PLCs; robotics (OT, IK)
Bridge 5.5 — Industry 4.0 Crisis 2010s– Digital OT not harmonized with management practices;
Bridge ongoing Tower of Babel problem (OT without MP)
WAVE 6.0 — AI-Enabled Lean On the AI as integration layer fusing OT and IK; NextLean
Production horizon management practices (OT, IK, MP converging)
Wave rows (white with bold lettering) are periods of broad industrial diffusion. Bridge rows (gray) are
transition periods when new capabilities are available but management practices for deploying them
at scale have not yet been codified. Forces: OT — Operations Technology; MP — Management
Practices; MM — Military-to-Manufacturing Transfer; IK — Information and Knowledge Integration;
PC — Product Cycle (allocates manufacturing activities across regional economic markets).
Hill —Revised Written Testimony — Senate Committee on Small Business and Entrepreneurship 21
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