#589 – Manufacturing is Thriving Where?Posted on
Manufacturing is Thriving Where?
Some headlines catch our attention more than others. For example, Forbes recently posted an article entitled, “The U.S. Cities Where Manufacturing Is Thriving”. Obviously that is something we at Agracel would be very interested in checking out. Upon reading, however, we learn that Forbes is only evaluating cities with at least 50,000 manufacturing positions. As you know, we very rarely develop projects in cities at big as 50,000, let alone one that had 50,000 manufacturing jobs!
None the less, the article did have some very good information that we want to share. Below are some excerpts from the article that we feel applies to communities of all sizes.
Over the past quarter century, manufacturing has hemorrhaged over 5 million jobs. The devastation of many regional economies, particularly in the Midwest, is testament to this decline.
Yet manufacturing remains critically important. Over the period from 1997 to 2012, labor productivity growth in manufacturing—3.3% per year—was a third higher than the rest of the economy. Clearly manufacturing is no technological laggard, accounting in 2012 for 68.9% of all R&D expenditures by U.S. businesses and employing 36% of the nation’s scientists and engineers, the largest share of any industry.
So even as employment has declined or stagnated, the impact of manufacturing on local economies remains profound. Manufacturing has the highest multiplier effect of any sector of the economy. According to the Commerce Department, a dollar of final demand for manufacturing generates $1.33 in output from other sectors of the economy, considerably higher than the multiplier for information ($0.80) and more than twice as high as such fields as retail trade ($0.66) and business services ($0.61). Other estimates place this impact far higher.
NOTE – In last week’s Agurban, we included a message from our good friend Maury Forman (Startup Wisdom) who shared “The Century Club” list with us, containing the names of over 100 businesses that have existed in the State of Washington for 100+ years. Unfortunately, the link we included was incorrect. We apologize! You can find the complete list here.