Tony Bennett, President and CEO of the Texas Association of Manufacturers (TAM), has been the voice of the state's manufacturing sector for over a decade. 

Under his leadership, TAM has advocated for policies that promote affordable energy, workforce development, tax reform, and regulatory adjustments that support Texas’ robust manufacturing industry. 

With the 2025 Texas Legislature set to convene, Bennett recently sat down with Texas Talk host Brad Swail to discuss the state of manufacturing, workforce education, energy solutions and key issues. 

Texas has long been a leader in manufacturing, and under Bennett's stewardship, TAM has grown to represent over 600 companies spanning 24 major industry sectors, including aerospace, automotive, petrochemical, semiconductor manufacturing and more. 

According to Bennett, Texas has been the top manufacturing export state in the U.S. for an impressive 22 years, a feat made more remarkable by the fact that Texas is the eighth-largest economy in the world.

“22 years in a row now [Texas] has been the number one manufacturing, export state in the United States, number one for 22 years,” he said. “Obviously, that's impressive when you're the eighth largest economy in the world, bigger than Russia, Spain, Australia, etc. and – I believe – even Canada.”

TAM's mission is clear: to advocate on behalf of manufacturers across the state, ensuring that the industry remains competitive on a global scale. 

The association focuses on regulatory and legislative matters, providing a voice for manufacturers at the state Capitol in Austin and in Washington, D.C. 

Their membership includes both small family-owned businesses and industry giants, with about 70 major corporations at the forefront.

One of the biggest challenges facing Texas manufacturers today is workforce development. As industries continue to evolve, particularly in advanced manufacturing sectors like semiconductors and aerospace, there is a growing need for skilled workers who can fill high-tech, high-wage jobs.

Bennett emphasized that there is an urgent need to bolster workforce education, particularly at the high school and community college levels. He sees it as a critical area where TAM can play a proactive role in shaping the future of Texas manufacturing.

“Workforce education, skills development, what we call filling the talent pipeline and keeping it filled so that we can attract the advanced manufacturing entities that are looking for, in some cases, a more stable place to operate,” he said. 

Bennett is optimistic about the growing momentum to integrate technical skills training into high school curriculums. In some areas, high school students can take courses that earn them both high school and college credit, setting them up for careers in fields like automotive manufacturing, aerospace and semiconductor production.

“Kids today can go, you know, they can have their basic classes at high school,” Bennett said. “And then that afternoon and go to the community college or go to their apprenticeship at an automotive plant or somewhere like that.”

As manufacturing in Texas continues to grow, energy availability and affordability remain top priorities for TAM. 

Bennett spoke about the delicate balance between renewable energy sources and the need for reliable, dispatchable power—especially in the wake of the severe winter storms in 2021 and 2022, which exposed vulnerabilities in the state's grid.

Bennett said, "natural gas is essential” bemoaning the move away from the energy source. 

“With all of this influx of renewable energy, we have lost the balance of the old standby natural gas,” he said. 

Bennet added that limitations inherent to renewable energy must be balanced out with natural gas or nuclear. 

“Wind and solar have their fuel is obvious and when the sun ain't shining and the wind blowing out West Texas, you're going to go down,” he said. 

While the state moves towards more renewable energy sources like wind and solar, Bennett stressed the importance of ensuring that the grid remains resilient and reliable for manufacturers who require constant, uninterrupted power. 

He pointed to a legislative win in 2023 with the Texas Energy Fund, which provides low-interest loans and grants to support the construction of new natural gas plants and other reliable energy infrastructure.

“How are you going to backup a semiconductor fab that if you have just a little glitch in your power for a millisecond, it can ruin several days or weeks of a batch of microchips costing tens to hundreds of millions of dollars,” he said. “So it's really important to have reliable power, resilient power, which means all your poles and wires and deliver it to residential folks and to business and industry.” 

Looking ahead, Bennett is also hopeful about the potential of small modular nuclear reactors. 

While nuclear energy has historically been slow to develop in Texas, advances in smaller reactors could offer a quicker solution to energy needs.

“There's a lot of promising things going on with small modular reactors,” he said. 

Another major trend in the manufacturing sector is the integration of artificial intelligence (AI) and automation. 

While some workers may be concerned about automation displacing jobs, Bennett sees AI as an opportunity to enhance efficiency and create higher-skilled roles in manufacturing.

“Your warehouses and inventory are going to be AI driven,” he said. “Your manufacturing production or the AI driven quality control, everything. Does that mean there's going to be no humans in the plant? Absolutely not. Are they going to be more highly skilled humans? Absolutely. And so there will still be maintenance required and lower skilled jobs.” 

Bennett is confident that while automation will replace some low-skilled jobs, it will also create many new opportunities for highly skilled technicians who can operate and maintain advanced manufacturing technologies.

“There's going to be a huge demand for highly skilled manufacturing techs and experts in robotics and AI and data centers,” he said. 

As the 89th Texas Legislature approaches, TAM has outlined a clear set of priorities to ensure that Texas manufacturing continues to thrive. 

Among the key issues are renewing tax incentives for research and development (R&D), securing affordable and reliable energy, and addressing the state’s growing water needs.

Bennett highlighted the importance of renewing the state’s R&D tax exemption, which is set to expire unless action is taken by lawmakers. 

Currently, Texas offers a modest 5% exemption, far behind other states like California, which offers 36%, and even China, which provides a 200% deduction for R&D.

“There won't be one unless we renew it this session,” he said. “That's going to be very critical.” 

TAM is also focused on addressing the state’s infrastructure needs, particularly in the areas of water and workforce development. With Texas' population booming, access to clean, reliable water is essential for both residents and businesses.

“We need a dedicated water fund, which we do not have today, but we have a surplus estimated between $20 billion,” he said. “And if you count the rainy day fund in there, we have like $32 billion of surplus money. Surely we can shave off a little bit of that and come up with a dedicated water fund, and we're going to be asking for that.”