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Siemens CEO Barbara Humpton joined Yahoo Finance to discuss important investments to be made in infastrcuture.
ADAM SHAPIRO: Jared, we're going to keep talking about this, but in a different way. In a world where everything is connected, infrastructure is absolutely key. Everyone knows this. Let's bring into the stream Barbara Humpton. She is the US CEO from Siemens, has been writing on her blog about the need for the US to up its game with infrastructure.
We also bring in our reporter from Washington, DC, Jessica Smith. Welcome both of you. And, Barbara, let me start with you. Why does it take the US Congress so long to deal with infrastructure? I used to be in Washington, DC, and I can't think of a time they ever acted on it when they said they were going to.
BARBARA HUMPTON: I know. Isn't it great? I mean, here we sit at this brilliant moment to be making an investment, and we do have a legacy where these have been difficult decisions for our lawmakers to get through. Why is that? I think a lot of people may not perceive the true benefit of the investment in infrastructure.
We know from the American Society of Civil Engineers that $1 invested can yield about $4 of economic benefit. And another thing I recently learned from them is that $1 of deferred maintenance can lead to over $17 of economic impact. So this ought to be a pretty straightforward equation.
JESSICA SMITH: Hi, Barbara, Jessica Smith here. One thing that I hear all the time when I'm talking to lawmakers is, what is actually infrastructure? What do you think really needs to be in this proposal? Because I know you've said before that it needs to be more than just highways and bridges.
BARBARA HUMPTON: I wrote an open letter to government leaders really making the case that infrastructure does go beyond the bridges and highways that had been so essential in the past. They were game-changers in their day. We do need that. We need to maintain that infrastructure.
But now, we need to really focus on the infrastructure that will lay the foundation for American economic prosperity for the next century. The things that we're looking to are new connected, electric forms of transportation-- upgrades to the grid, the idea that we really need to be investing in manufacturing, because building the things we need locally in order to satisfy global needs is a key part of what we think of as infrastructure.
SEANA SMITH: Barbara, one of the things we've seen on the manufacturing front is this massive chip shortage that we've been talking about affecting a number of industries. When you talk about how infrastructure could potentially help this, how do you see that, and how do we, I guess, best address this issue?
BARBARA HUMPTON: I think the big term that people are coming back to is glocal. You know, we are, many of us, playing on a global stage. And over the last couple of decades, there was a tendency to look globally for the low cost supply center somewhere in the world and then take advantage of really strong supply chains that would move materials around the world.
We're recognizing now after the disruption of the past year that keeping the creation, the manufacture of goods close to the point of demand is really important. And so this idea of having more localized supply chains is a very powerful concept, and one where I know businesses everywhere are looking and analyzing they may keep operations somewhere offshore, but they know that they also need to have operations onshore.
JESSICA SMITH: How do you think that this infrastructure package should be paid for? Would you support raising the corporate tax rate to 25% or 28%?
BARBARA HUMPTON: Well, we, obviously, as a business here in the US, our number one priority is to make sure that US businesses are competitive on the global stage. But we also understand it's an important time for us to engage in reasonable dialogue. So our experts are busy working with the people who are crafting plans, making sure that we really look at the details. Here's where we think investment can and should be made.
Investments should be made in research and development. And we should be looking to create jobs. All of those are going to be mechanisms that will drive economic growth and actually yield the long-term economic benefits that we all hope to see.
ADAM SHAPIRO: I'm curious, though, Barbara, when President Biden talks about our infrastructure potential and Buy American, I realize how connected and important Siemens USA is to that equation. Yet you're a subsidiary of a German company. Do you worry the Buy American might leave companies or subsidiaries like yours out in the cold?
BARBARA HUMPTON: I don't think it will, and I'll tell you why-- our 40,000 employees here are as American as you can get. And beyond that, 24,000 suppliers, and 1/4 of them are diverse-- led by minorities and women. I mean, this is a supply base that's all-American.
And what you'll find is that a company like ours-- we've been here for 160 years-- we've made these commitments, we've been supporting important customers like the US federal government, where these requirements have long been one of the conditions of being in this market. So I'm confident that Siemens will rise to the challenges ahead, and that we will continue to create jobs here in the US.
SEANA SMITH: Barbara, one thing that we've seen on the jobs front recently has been we've heard from a number of CEOs that they've had a tough time finding workers. And I know Siemens has 26 manufacturing sites nationwide. You employ thousands of workers. Have you been having trouble at all attracting workers? And what are you doing about that?
BARBARA HUMPTON: You know, I think we're lucky in that the work we do has a very clear mission and purpose. And we know that people everywhere are drawn to our mission. We're a company that's dedicated to addressing the global megatrends of climate change, and urbanization, the aging demographics of the world population. And so people want to get involved in jobs like this.
Today, and on just about any given day, you'll find we have about 2,000 jobs open across the United States. We really are growing in the areas of, particularly, digitalization and consulting-- and areas that are going to help our customers drive-through the digital transformation. The area that we're most concerned right now is in manufacturing, because there were already 400,000 open jobs pre-pandemic.
And even with the low-- you know, even with so many people being out of jobs, what we found is a low level of people prepared to take the manufacturing jobs of the future. So at Siemens, we're investing a lot in the kind of apprenticeships, the kinds of programs that are going to bring people into the field that will really help our customers in their missions as well.
ADAM SHAPIRO: Barbara, it's about the future. And I hope in the future, as Congress is debating the infrastructure bill that will eventually emerge, that you will consider coming back to talk with us about it. Thank you for being here-- Barbara Humpton, Siemens US CEO, and Jessica Smith, our reporter from Washington, DC.