Manufacturing & Engineering Facts

Many people believe that manufacturing is "dying" in the U.S.* That we no longer produce many products.

The fact is, the U.S is still the #1 manufacturer in the world (as of 2011 - http://unstats.un.org/unsd/snaama/dnllist.asp). While China is rising fast in manufacturing output, and will eventually surpass the U.S., it doesn't mean the U.S. is "losing" in manufacturing. China has 1.5 billion people (more than 4 times the U.S. population), a rapidly expanding domestic market, and centralized control of their economy, so we might expect that they would be able to produce more. However, costs are increasing in China and there are studies that indicate more manufacturing will be coming back to the U.S. because of this.

So don't fret, the U.S. will continue to be a major manufacturing force.

1) BCG report talking about how manufacturing jobs are coming back to the US because of rising costs in China.
- http://www.bcg.com/documents/file84471.pdf

2) Interview with Andy Grove (former CEO of Intel) stating that the US should work hard to bring manufacturing jobs back to the US
- http://www.technologyreview.com/computing/38344/

3) Top American Made Cars. (#1 is Toyota Camry made in Kentucky, #2 is Honda Accord made in Ohio)
- http://www.cars.com/go/advice/Story.jsp?section=top&subject=ami&story=amMade0710

4) Can China compete with US manufacturing?
http://curiouscapitalist.blogs.time.com/2011/03/10/can-china-compete-with-american-manufacturing/

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* This perception is driven by a couple of things:

1) Manufacturing employment has declined in recent decades. This is true, but the main driver of this is productivity increases. Overall U.S. output in manufacturing has grown, but due to increased efficienices, the number of workers required to produce this output has decreased.


Economic Policy Institute - http://www.epi.org/publications/entry/bp171/

2) Manufacturing's share of the U.S. GDP has decreased (around 12% in 2011). This would seem to indicate the shrinking impact of manufacturing. But part of that shrinking % is due to the relatively low price inflation associated with manufactured goods vs. other sectors. Think about how much computers, cars, microprocessors, etc. cost compared to 20-30 years ago versus other goods (food, gasoline, services, etc.). For much of the technology sector, prices have remained relatively flat or decreased (think how much that $500 computer of today would have cost you 30 years ago)..

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Source – NAM (National Association of Manufacturers) / Manufacturing Institute

Additional Skill Gap Support

• More than 80 percent of U.S. manufacturers report an overall shortage of qualified employees that is affecting their ability to meet customer demands, according to the 2005 Skills Gap Report. (link to report: http://www.nam.org/s_nam/bin.asp?CID=89&DID=235731&DOC=FILE.PDF )

• In addition, recent reports confirm that manufacturers continue to report an overall shortage of qualified skilled workers. (source: Advanced Technology Services, Inc. link: http://www.advancedtech.com/arccms/press30.html )

• Nearly half (46 percent) of small and medium manufacturers report that “finding qualified employees” is one of the most serious problems facing their company, according to the 2007 Small Manufacturers Operating Survey. (link to report: http://www.nam.org/s_nam/bin.asp?TrackID=&SID=1&DID=239833&CID=372&VID=2 )

• Nearly three out of four manufacturers surveyed believe that a high performance workforce is the most important driver of future business success.

McGladrey
2010 Manufacturing and Wholesale Distribution National Survey
• During the recession, both manufacturing and distribution companies reported difficulty finding qualified workers. That trend continues this year, with needs reported across a wide range of positions. Carrying over from 2009 is a continued need for sales professionals, with 65 percent of distribution companies ranking this as a need (12% as an urgent need). Sales is also a sought-after skill on the manufacturing side (47%). Slightly more than half of manufacturers say they are searching for engineers (12% as an urgent need).
http://www.aftermarketsuppliers.org/pdf/2010MWD.pdf


Next Generation Manufacturing Study. 2009
http://www.smallmanufacturers.org/picts/NGM-Overview-and-Findings.pdf

Manufacturing employment (Nov. 2010)
• Business First Monday, December 27, 2010, 1:02pm EST
• The database below contains employment totals for the manufacturing sectors in the nation’s 100 biggest markets. All figures are as of November 2010, as compiled by the U.S. Bureau of Labor Statistics. They are not seasonally adjusted. The chart shows the raw change in manufacturing employment between 2000 and 2010. Click View Details to get the percentage change for the market of your choice.
Manufacturing employment (Nov. 2010) | Business First