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Taking His Economic Message On The Road, Obama Touts Factory Jobs In Iowa

President Obama tours Conveyor Engineering and Manufacturing in Cedar Rapids, Iowa, on Wednesday.
Jewel Samad
AFP/Getty Images
President Obama tours Conveyor Engineering and Manufacturing in Cedar Rapids, Iowa, on Wednesday.

A day after delivering his State of the Union address to Congress, President Obama took his message on the road. Obama hoped that stops at manufacturing sites in Iowa and Arizona would drive home his point that the government should do more to encourage factory jobs.

The three-day trip also includes stops in Colorado, Nevada and Michigan. Those are all states likely to be important in the November election.

Obama kicked off his road trip at Conveyor Engineering and Manufacturing, a factory in Cedar Rapids, Iowa.

Though Conveyor is not a particularly big company — just 65 workers — it hopes to double in size in the next several years.

The Hawkeye State is home to a significant number of factories. And manufacturing is one of the central "pillars" in Obama's blueprint for a stronger U.S. economy. It's also been a relative bright spot in the U.S. economy.

The auto industry in particular has rebounded with the help of the government's rescue of General Motors and Chrysler. Speaking to a crowd at Conveyor, Obama said the U.S. auto industry has added some 160,000 jobs in the past two years.

"Today, the American auto industry is back," Obama said. "And I want what's happening in Detroit to happen in other industries. I want it to happen in Cleveland and Pittsburgh and Raleigh. And I want it to happen right here in Cedar Rapids, Iowa."

Obama also spoke fondly of the Iowa caucuses that launched his national political career four years ago. But it's not just nostalgia that brought him to Cedar Rapids. Iowa, like all the states he's visiting this week, is important to the president's re-election chances.

While Iowa is perhaps better known for corn and soybeans, the state is also home to a significant number of factories.

"The eastern part of the state along the Mississippi River is an area that is well-known historically for its farm machinery, construction machinery, and a broad array of durable goods manufacturing," says Dave Swenson of Iowa State University.

Iowa's experience helps illustrate why the administration wants to promote manufacturing.

Factory jobs tend to pay higher wages and create a bigger ripple effect in the surrounding economy. Factories account for just 11 percent of the jobs in Iowa but 17 percent of the state's payroll.

In order to command those high wages, today's factory workers need specialized skills, Swenson says.

"It may have been 25, 30 years ago you didn't even need to go to high school to get a manufacturing job and to have a good life," Swenson says. "Those days are rapidly going away. You need to be able to operate computer equipment, you need to be able to operate computer-driven machine tools. Then, you need to have quantitative problem-solving skills."

Skilled workers and advanced equipment are helping to make U.S. factories more productive than ever and most cost-competitive with rivals overseas. Obama wants the federal government to encourage that trend.

"We've got to seize that opportunity," Obama said. "We've got to help these companies succeed. And it starts with changing our tax code."

Obama announced during his State of the Union address Tuesday that his upcoming budget will propose a series of tax breaks to reward companies for locating factory jobs in the U.S., while eliminating breaks for companies that move jobs offshore.

It's not at all clear that Congress will go along with those changes.

But by making the case, Obama is also trying to make a larger argument about the role of government: He hopes to show that his controversial rescue of the auto industry has paid off and that prosperity is greatest when it's most widely shared.

"You know, this country only exists because generations of Americans worked together, and looked out for each other, and believed that we're stronger when we rise together," he said.

That's a pillar not only of the president's economic blueprint, but also of his re-election campaign.

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Scott Horsley is NPR's Chief Economics Correspondent. He reports on ups and downs in the national economy as well as fault lines between booming and busting communities.