Job growth is occurring as companies replace aging equipment, take advantage of government incentives, seek energy savings and discover that it makes sense to produce some products domestically, rather than operating over long distances.

A new tax break, approved by Congress in December, is expected to further stimulate investment by letting companies deduct 100% of certain types of investments from taxable income in 2011.

The turnaround comes from companies that weathered the recession, and are now building and upgrading their factories, spurred by government tax incentives. At least in the near term, prospects are good, and some expect that Manufacturing will be a good source of job growth over the next decade. Mind you, this turnaround doesn't quite make up for the 6,000,000 manufacturing jobs lost in the US over the past 10-15 years.

US manufacturers that survived the brutal 2008-09 recession are now very competitive, and can afford to expand with much lower labor costs and debt burdens. While they will keep building factories overseas to satisfy demand in foreign markets, they’ll also be investing in US plants.

After the worst recession since the 1930's, manufacturing revenue has grown for almost a year and a half, which is good news after shedding jobs offshore.

Despite the upbeat forecasts, many companies are being very cautious in their hiring, partly to avoid the risk of having to lay off later. They are finding ways to increase production without adding workers - through automation and better efficiency.

Between 2000 and 2007, manufacturing employment had already reduced by about 30%, or 3 million, as companies faced intense pressure from cheaper overseas production. Also, during the recession and subsequent recovery, automation technology accelerated, and productivity jumped 8.6 % in 2010, the biggest gain in 20 years. Automation investments increased by 15% this year to $590 billion, the biggest increase in over a decade, as automation delivered ways to do more with less.

But Manufacturing is not out of the woods. To continue this growth, US manufacturers must adopt new business growth strategies. They must prepare for "re-shoring" - bringing production back to North America by finding new and innovative ways to reduce costs and train workers in new methods and machinery.

To emphasize the turnaround, President Obama declared that his primary job is "putting our economy into overdrive". He announced a restructured presidential advisory board to stress increased employment and greater export opportunities. He put GE CEO Jeffrey Immelt in charge - good man, and a good choice. Hey, have you seen the new GE TV ad.? It features GE employees line-dancing, to show that innovation is fun. That's the positive American attitude!