Manufacturing has always been a major source of growth, economic power and innovation in the United States. Over 10-million Americans are employed in manufacturing, which makes a significant contribution to the United States GDP (see glossary).
With the recent rise in Chinese labour costs, there has been a resurgence in manufacturing in the United States. According to the National Association of Manufacturers, manufacturing in the United States, taken alone, would be the eighth largest economy in the world. Could United States manufacturing be entering its second golden age?
PwC reports that just as multinational manufacturers have been eager to place their stake in the fast-growing markets in Asia-Paciﬁc, Brazil, and Africa, some manufacturing companies are rethinking their United States strategy, whether reshoring or locating new plants. Factors influencing decisions to reshore manufacturing include availability of skills, transportation costs, availability of capital, and the tax and regulatory environment.
The manufacturing sector is made up of businesses that transform materials, substances or components into new products with the help of machinery or equipment. They are often described as plants, factories or mills. Some businesses, such as bakeries and custom tailors, sell products from the same premises where the products are made.
The North American Industry Classification System (NAICS) is used by the United States government to classify businesses according to type of economic activity. Industrial manufacturing is divided into 21 sub-groupings, from apparel to wood product manufacturing.
|Industry classification||Number of employees||Value of products shipments ($1,000)|
|Petroleum and coal products manufacturing||99,030||795,584,982|
|Transportation equipment manufacturing||1,238,895||673,679,203|
|Computer and electronic product manufacturing||807,335||314,866,524|
|Fabricated metal product manufacturing||1,275,573||304,754,150|
|Primary metal manufacturing||372,906||271,889,155|
|Plastics and rubber products manufacturing||676,671||194,953,033|
|Beverage and tobacco product manufacturing||139,313||127,067,319|
|Electrical equipment, appliance, and component manufacturing||324,313||111,458,679|
|Non-metallic mineral product manufacturing||332,937||88,507,240|
|Printing and related support activities||455,650||78,795,652|
|Wood product manufacturing||323,301||66,923,613|
|Furniture and related product manufacturing||321,531||57,168,690|
|Textile product mills||106,437||21,009,493|
|Leather and allied product manufacturing||27,112||4,760,637|
Source: US Census Bureau, 2011
Annual Survey of Manufactures
Petroleum and coal have the highest value of products shipments, followed by chemical manufacturing, which includes healthcare pharmaceutical and medicinal products as well as explosives. Over 1.3-million people were employed in food manufacturing in 2011, working in businesses as diverse as patisseries and abattoirs.
Another large employer and an industry that’s vital to the United States economy is transportation equipment manufacturing. Automotive manufacturing, shipbuilding, aerospace equipment, railroad stock, and military vehicles all form part of this grouping.
Businesses classified as ‘miscellaneous manufacturing’ by NAICS include manufacturers of medical equipment, sporting and athletic goods, musical instruments, burial caskets, jewellery, dolls, toys and games.