The Victor Meldrew theory of economics seems to have been dominant last week. Ben Bernanke said QE is to be eased up because of encouraging news out of the US economy. The markets sold in their droves. In short, they sold on good news. How can that be? Maybe, in response to the idea that the US economy is slowly on the return to health they just think “I don’t believe it”. But here is a reason why I do believe it – at least I believe it long term – and it is called 3D printing.
It was a couple of years ago when the Boston Consulting Group predicted that later this decade manufacturing jobs would return to the US. It stated: “The conditions are coalescing for another US resurgence. Rising wages, shipping costs, and land prices – combined with a strengthening renminbi – are rapidly eroding China’s cost advantages. The US, meanwhile, is becoming a lower cost country. Wages have declined or are rising only moderately. The dollar is weakening. The work force is becoming increasingly flexible. Productivity growth continues.” Since then Apple has announced a new US based manufacturing facility for Macs, and Google has revealed that its new Motorola phone will be made in the US.
It is not something I feel comfortable about admitting to, but what happens in the US tends to follow in the UK. I think there are signs of a slow revival in UK manufacturing too, and of late the news on the UK car industry has actually been very encouraging indeed.
These developments are all very interesting, but I am sure that over the next few years, and certainly by the beginning of the next decade, the real manufacturing story to emerge will be that of 3D printing.
This really is a major game changer and could be as significant as the development of mass production in the early 20th century.
You may have heard recently how NASA has thrown money at a project to make pizzas using 3D printing. The idea is for the printer to create a margarita pizza from various powders mixed with water. It sounds horrible, I know, but don’t write it off until you have tasted it.
And from Victor Meldrew to another TV character: Jean-Luc Picard. I guess the dream is for you to be able to say to your printer: tea, Earl Grey, hot – and If you don’t get that comment it is probably a good thing, if you do then, like me, you have probably been watching too much ‘Star Trek’.
My real point, though, is that 3D printing is the stuff of science fiction, and yet it is becoming real – within a few years it will even be every day.
For some time I have held one major doubt about 3D printing, and that is the effect it will have on jobs.
But I am slowly changing my mind. In fact I am beginning to think 3D printing may have the opposite effect and create a new market in skilled labour. All of a sudden design skills are going to be in vogue. At first I think we will see the emergence of 3D printing stores in High Streets, so we can just pop in and get a consultant to design a simple product for us. I am thinking about my lawn mower here. I bought quite an expensive one three years or so ago, but at some point I lost a big plastic screw thing, and ever since the mower has been partly held together by string. The combination of a 3D printer, and a competent designer could fix this problem, probably in about 30 minutes.
But the area where I think 3D printing may become truly exciting is in the clothes industry. I can envisage an opportunity for the likes of Marks and Spencer to offer a new tailor service. You go into a store, look at various designs, pick and mix different aspects from the designs, choose your colour, and size, and return a couple of hours later for your new item of clothing.
3D printing could transform the High Street, and in a very positive way. It will open up a new industry for designers, artists, and may even create a new type of local craftsman. The shop assistants of the future may be experts in CAD or, have a degree in fine arts, and their pay will reflect this too.
For both the UK and the US this is a new opportunity. For many years we have heard how the UK is good at creative industries – good at design. Well, a new industry is set to open up that will give us the chance to prove it.
From an investor’s point of view this is an exciting opportunity. When it comes to 3D printing, most of the tip sheets focus on new, and obscure technology companies. But companies we have all heard of will do well from this development too. In the world of technology, I am guessing that IBM will be a big winner.
But just as the tablets computers have helped to boost sales at Dixons, I can see 3D printers creating a new opportunity for many High Street names with which we are all familiar today. To pick the winners, watch the current crop of retailers very closely. See which ones are first to embrace 3D printing because they may be the ones that inject new life into the economy, and with shares to match.
These views and comments are those of the author alone and do not necessarily reflect the view of The Share Centre, its officers and employees