iii

NIST Special Publication 1142

The Current State and Recent 

Trends of the U.S. Manufacturing 

Industry

Douglas S. Thomas 

http://dx.doi.org/10.6028/NIST.SP.1142
iv

NIST Special Publication 1142 

The Current State and Recent 

Trends of the U.S. Manufacturing 

Industry

Douglas S. Thomas

Applied Economics Office

Engineering Labaratory

http://dx.doi.org/10.6028/NIST.SP.1142

December 2012

U.S. Department of Commerce 

Rebecca Blank, Acting Secretary

National Institute of Standards and Technology 

Patrick D. Gallagher, Under Secretary of Commerce for Standards and Technology and Director 
v

Certain commercial entities, equipment, or materials may be identified in this

document in order to describe an experimental procedure or concept adequately.

Such identification is not intended to imply recommendation or endorsement by the

National Institute of Standards and Technology, nor is it intended to imply that the

entities, materials, or equipment are necessarily the best available for the purpose. 

National Institute of Standards and Technology Special Publication 1142

Natl. Inst. Stand. Technol. Spec. Publ. 1142, 150 pages (December 2012) 

http://dx.doi.org/10.6028/NIST.SP.1142

CODEN: NSPUE2
iii

Abstract

This report brings together multiple sources of aggregate manufacturing industry data and 

industry subsector data to develop a quantitative depiction of the U.S. manufacturing 

industry. It compares the U.S. manufacturing industry to its international counterparts in 

order to provide context to domestic activities. This approach promotes a better 

understanding of the U.S. manufacturing industry and provides an evidence-based 

depiction of both the industry and its subsectors. Domestic and international data on 

employment, compensation, output, value added, net income (profit), and research and 

development expenditures are explored and evaluated. A number of techniques are 

utilized to compare and analyze these data including input-output analysis. Many of the 

industry’s subsectors are discussed individually with a focus on medium- and hightechnology sectors.

The U.S. produces approximately 18 % of the world’s manufactured goods, making it the 

largest manufacturing nation in the world, according to 2008 United Nations Statistics 

Division (UNSD) data. This data also shows that U.S. manufacturing growth lags behind 

that of many countries and is growing slower than the whole of the U.S. economy. 

Compound annual growth in U.S. manufacturing is below the 20th percentile of 180 

nations. Countries such as the United Kingdom, Japan, Canada, France, Germany, 

Australia, and Italy were among the many countries that had a higher growth rate than the 

U.S. This corresponds with data from the Bureau of Economic Analysis (BEA) that 

shows that U.S. manufacturing’s average annual ten year growth has declined from 

around 4 % in 1957 to -1 % in 2008. While manufacturing value added is larger in the

U.S. than in any other country, U.S. manufacturing per capita has lagged slightly behind 

some industrialized nations, such as Germany and Japan. At least 20 other nations had a 

higher manufacturing value added per capita than the U.S. in 2008, according to UNSD 

data. In 2005, the U.S. had a higher rate of manufacturing businesses exiting the market 

than entering it while other countries such as Canada had a higher rate of businesses 

entering the market. Seemingly, this trend has left the U.S. manufacturing industry with 

one of the lowest numbers of active employer enterprises per capita and having a share of 

total employment lower than Germany, Italy, Japan, France, Canada, and the United 

Kingdom. Despite slow growth, U.S. research and development expenditures in 

manufacturing, both nominal and per capita, are among the highest being greater than 

Germany, Canada, Australia, and China, according to OECD data. This is complimented 

by the fact that the U.S. is among the top publishers of scientific and technical journals as 

well as patent applications, both in nominal and per capita data from the World Bank.

Additionally, manufacturing continues to play a significant role in the U.S. economy as it 

accounts for 23% of U.S. output according to BEA data and 28% according to OECD 

data.

Keywords: Competitiveness; Industry; Manufacturing; Statistics; Technology
iv

Preface

This study was conducted by the Applied Economics Office in the Engineering

Laboratory at the National Institute of Standards and Technology. The study provides 

aggregate manufacturing industry data and industry subsector data to develop a 

quantitative depiction of the U.S. manufacturing industry.

Disclaimer

Certain trade names and company products are mentioned in the text in order to adequately specify the 

technical procedures and equipment used. In no case does such identification imply recommendation or 

endorsement by the National Institute of Standards and Technology, nor does it imply that the products are 

necessarily the best available for the purpose.

Cover Photographs Credits

Microsoft Clip Art Gallery Images used in compliance with Microsoft Corporation’s non-commercial use 

policy.
v
vi

Acknowledgements

The author wishes to thank all those who contributed so many excellent ideas and 

suggestions for this report. Special appreciation is extended to Simon Frechette and 

Conrad Bock of the Engineering Laboratory’s Systems Integration Division and to 

Frederick Proctor of the Engineering Laboratory’s Intelligent Systems Division for their 

technical guidance, suggestions, and support. Additionally, the author would like to thank 

economists Stephen Campbell and Dr. Gregory Tassey of the Associate Director for 

Innovation and Industry Services’ Economic Analysis Office for their insight and ideas. 

Special appreciation is also extended to Dr. David Butry, Dr. Stanley Gilbert, and Dr. 

Robert Chapman of the Engineering Laboratory’s Applied Economics Office for their

thorough reviews and many insights and to Ms. Carmen Pardo for her assistance in 

preparing the manuscript for review and publication. The author also wishes to thank Dr. 

Nicos Martys, Materials and Structural Systems Division, for his review. 
vii
viii

TABLE OF CONTENTS

ABSTRACT............................................................................................................................................... III

PREFACE .................................................................................................................................................IV

ACKNOWLEDGEMENTS ...........................................................................................................................VI

1 INTRODUCTION .............................................................................................................................. 1

1.1 BACKGROUND ...................................................................................................................................... 1

1.2 PURPOSE ............................................................................................................................................. 3

1.3 SCOPE AND APPROACH........................................................................................................................... 4

2 MANUFACTURING INDUSTRY STAKEHOLDERS, METRICS, AND DATA ............................................. 7

2.1 MANUFACTURING INDUSTRY STAKEHOLDERS.............................................................................................. 7

2.2 MANUFACTURING INDUSTRY METRICS AND DATA ..................................................................................... 11

3 INTERNATIONAL DATA: HOW THE U.S. COMPARES TO THE REST OF THE WORLD ........................ 15

3.1 UNITED NATIONS ................................................................................................................................ 16

3.2 ORGANIZATION FOR ECONOMIC COOPERATION AND DEVELOPMENT ............................................................. 23

3.2.1 Production............................................................................................................................. 23

3.2.2 Input-Output Data ................................................................................................................ 31

3.2.3 Research and Development.................................................................................................. 35

3.3 WORLD BANK .................................................................................................................................... 39

3.4 INTERNATIONAL COMPARATIVE INDICES .................................................................................................. 40

4 DOMESTIC DATA........................................................................................................................... 43

4.1 CENSUS BUREAU................................................................................................................................. 43

4.1.1 Annual Survey of Manufactures and the Economic Census.................................................. 44

4.1.2 Manufacturers’ Shipments, Inventories, and Orders Survey................................................. 49

4.2 BUREAU OF ECONOMIC ANALYSIS........................................................................................................... 52

4.2.1 Production............................................................................................................................. 53

4.2.2 Input-Output Accounts ......................................................................................................... 56

4.3 BUREAU OF LABOR STATISTICS: LABOR AND PRODUCTIVITY ......................................................................... 63

4.4 NATIONAL SCIENCE FOUNDATION: RESEARCH AND DEVELOPMENT ............................................................... 66

5 CHARACTERIZING THE U.S. MANUFACTURING INDUSTRY............................................................. 69

5.1 PRODUCTION ..................................................................................................................................... 69

5.2 RESEARCH, DEVELOPMENT, AND TECHNOLOGY ......................................................................................... 70

5.3 STAKEHOLDER’S PERSPECTIVE ................................................................................................................ 71

5.4 CHARACTERISTICS OF THE U.S. MANUFACTURING INDUSTRY ....................................................................... 74

6 DISCUSSION AND RESEARCH NEEDS ............................................................................................. 75

6.1 DISCUSSION ....................................................................................................................................... 75

6.2 RECOMMENDATIONS FOR FURTHER RESEARCH ......................................................................................... 76

APPENDIX A: GLOBAL COMPETITIVENESS INDEX RANKINGS (WORLD ECONOMIC FORUM)................... 83

APPENDIX B: IMD WORLD COMPETITIVENESS YEARBOOK, 2011 ........................................................... 89

APPENDIX C: ANNUAL SURVEY OF MANUFACTURES, MEDIUM- AND HIGH-TECH SECTORS (2009) ........ 91

APPENDIX D: SCHEMATIC DATA MAP (ASM)........................................................................................ 101

APPENDIX E: GLOSSARY OF TERMS ...................................................................................................... 109
ix

LIST OF FIGURES

Figure 2.1: Manufacturing Supply Chain ........................................................................... 8

Figure 3.1: UNSD Manufacturing GDP by Nation ($billions 2009)................................ 17

Figure 3.2: UNSD Manufacturing Value Added for 180 Countries, Compound Annual 

Growth Rate (1985-2008)................................................................................................. 18

Figure 3.3: UNSD Manufacturing GDP per Capita.......................................................... 19

Figure 3.4: UNSD Manufacturing as a Percent of GDP (1970-2008).............................. 20

Figure 3.5: Selected Manufacturing Subsectors: Value Added and Value Added per 

Capita ................................................................................................................................ 25

Figure 3.6: U.S. Manufacturing Value Added (excluding ISIC 15-22, 36, and 37) by 

Subsector (OECD Structural Analysis Database)............................................................. 26

Figure 3.7: Manufacturing Share of Employment (OECD SDBS Business Demography 

Database)........................................................................................................................... 30

Figure 3.8: Global Competitiveness Index Ranking (139 countries) by Category, 2010-

2011................................................................................................................................... 42

Figure 4.1: Value Added and Employment for Select Manufacturing Subsectors, Annual 

Survey of Manufactures (adjusted using industry specific PPI)....................................... 45

Figure 4.2: Value Added and Employment for Semiconductor and Other Computer 

Component Manufacturing ............................................................................................... 47

Figure 4.3: Manufacturing Employment and Valued Added, 2009.................................. 48

Figure 4.4: Manufacturing as a Percent of GDP (BEA)................................................... 49

Figure 4.5: Manufacturing Industry Supply Chain, 2009................................................. 50

Figure 4.6: Manufacturing Shipments, 1958-2000 (Manufacturers' Shipments, 

Inventories, and Orders Survey) ....................................................................................... 51

Figure 4.7: Manufacturing Shipments, 1992-2009 (Manufacturers' Shipments, 

Inventories, and Orders Survey) ....................................................................................... 52

Figure 4.8: U.S. GDP by Industry ($billions 2009), BEA................................................ 53

Figure 4.9: 10 Year Moving Average of Annual Growth in the Manufacturing Industry 

and Ratio of Imported Goods to Manufacturing Value Added......................................... 54

Figure 4.10: Ratio of BEA Value Added to Shipments from the Manufacturers' 

Shipments, Inventories, and Orders Survey...................................................................... 55

Figure 4.11: Manufacturing GDP (BEA), 1977-2009 ...................................................... 55

Figure 4.12: Selected Manufacturing Industries GDP by Industry (BEA), 1986-2009.... 56

Figure 4.13: Output per Unit of Labor (aggregate percent increase of BLS Index)......... 63

Figure 4.14: Manufacturing Employment as a Percent of Total Non-Farm Employment 

(CES)................................................................................................................................. 64

Figure 4.15: Employment in Manufacturing and Select Subsectors, 1919-2010 (Current 

Employment Survey) ........................................................................................................ 65

Figure 4.16: Wages in Manufacturing and Select Subsectors, 1919-2010 (Current 

Employment Statistics)..................................................................................................... 65

Figure 4.17: Company and Other Research and Development by Industry ..................... 67

Figure 4.18: Company and Other Research and Development by Industry (subsectors of 

the chemical industry and computer and electronic industry) ......................................... 68

Figure 4.19: Research and Development by Source of Funds.......................................... 68
x

LIST OF TABLES

Table 2.1: Stakeholders....................................................................................................... 9

Table 2.2: Stakeholder's Expected Returns and Associated Metrics................................ 12

Table 2.3: Sources of Data................................................................................................ 14

Table 3.1: Annual Wages by Select Manufacturing Subsectors, $2006 (UNIDO Statistical 

Country Briefs) ................................................................................................................. 21

Table 3.2: Detailed Manufacturing Value Added Industry Comparisons, 2006 (UNIDO 

Statistical Country Briefs)................................................................................................. 22

Table 3.3: OECD Value Added, 2006 .............................................................................. 24

Table 3.4: U.S. Value Added per Capita by Year, Percentile (OECD Structural Analysis 

Database)........................................................................................................................... 27

Table 3.5: U.S. Rank of Gross Operating Surplus per Dollar of Expenditure (OECD 

Structural Analysis Database)........................................................................................... 28

Table 3.6: U.S. Rank of the Ratio of Value Added to Hours of Work (OECD Structural 

Analysis Database)............................................................................................................ 28

Table 3.7: Wages by Year, Percentile (OECD Structural Analysis Database)................. 29

Table 3.8: Employer Enterprises in Manufacturing (OECD SDBS Business Demography 

Database)........................................................................................................................... 31

Table 3.9: Value Added from the STAN Input-Output Data............................................ 33

Table 3.10: Compensation, Gross Operating Surplus, and Taxes as a Percent of Value 

Added, mid-2000’s ........................................................................................................... 34

Table 3.11: Input-Output Analysis using OECD STAN Data, mid-2000’s ..................... 35

Table 3.12: Research and Development Expenditures by Country, 2006 (OECD STAN 

Database)........................................................................................................................... 37

Table 3.13: U.S. Research and Development Expenditures by Year, Percentile (OECD 

Structural Analysis Database)........................................................................................... 38

Table 3.14: U.S. Research and Development per Capita by Year, Percentile (OECD 

Structural Analysis Database)........................................................................................... 38

Table 3.15: U.S. Patents (OECD Patent Database) .......................................................... 39

Table 3.16: U.S. Science and Technology Indicators, Percentile (World Bank).............. 40

Table 3.17: U.S. Competitive Industrial Performance Index Rankings (121 countries 

ranked) .............................................................................................................................. 41

Table 4.1: Subsectors of Manufacturing, Annual Survey of Manufactures 2009 ............ 46

Table 4.2: Manufacturing Industry Impact on Output, 2009............................................ 59

Table 4.3: Products Used by Manufacturing Subsectors ($millions 2009) ...................... 60

Table 4.4: Manufacturing Products Used by Other Industries ($million 2009) ............... 61

Table 4.5: Manufacturing Industry Impact on Value Added, 2009.................................. 62

Reading Figures and Tables: Figures in this report frequently have two images and one 

legend. The legend applies to both images. Tables frequently have colored bars (red or 

green). These bars provide comparisons between other figures in the table, often between 

countries or industries. Red bars signify instances where a lower value is preferred such 

as rankings (i.e., being 1st is preferred over 31st).
xi

LIST OF ACRONYMS

ASM – Annual Survey of Manufactures

BEA – Bureau of Economic Analysis

BLS – Bureau of Labor Statistics

BOY – Beginning of Year

CES – Current Employment Statistics

CIP – Competitive Industrial Performance Index

CPI – Consumer Price Index

CPS – Current Population Survey

EIN – Employer Identification Number

EOY – End of Year

EPO – European Patent Office

FDI – Foreign Direct Investment

FOB – Free on Board

GDP – Gross Domestic Product

GNP – Gross National Product

IBRD – International Bank for Reconstruction and Development

IDA – International Development Association

IMD – International Institute for Management Development

IMF – International Monetary Fund

ISIC – International Standard Industrial Classification

NAICS – North American Industry Classification System

NCSES – National Center for Science and Engineering Statistics

NSF – National Science Foundation

OECD – Organization for Economic Co-operation and 

Development

PCT – Patent Co-operation Treaty

PEO – Professional Employer Organizations

PPP – Purchasing Power Parity

SDBS – Structural and Demographic Business Statistics

SNA – System of National Accounts

STAN – Structural Analysis Database

UN – United Nations

UNIDO – United Nations Industrial Development Organization

UNSD – United Nations Statistics Division

USPTO – United States Patent and Trademark Office
1

1 Introduction

1.1 Background

The U.S. produces approximately 18 % of the world’s manufactured goods, making it the 

largest manufacturing nation in the world, according to 2008 United Nations Statistics 

Division (UNSD) data. Medium and high technology goods, as defined by the United 

Nations Industrial Development Organization (UNIDO), account for 56 % of U.S. 

manufacturing value added in 2003.

1 Additionally, the industry impacts 23 % of U.S. 

output, according to 2009 data from the Bureau of Economic Analysis. Thus, the 

manufacturing industry is indispensable to the U.S. economy; however, numerous media 

articles have discussed the decline of U.S. manufacturing with many proposing that the 

U.S. has lost its competitive edge in manufacturing.

2 According to industry data, 

however, it is unclear whether the U.S. manufacturing industry is declining. After 

controlling for inflation, the industry grew 21% between 1980 and 2007, as measured in 

value added from the Bureau of Economic Analysis; thus, the industry is actually 

growing in terms of the value of the goods being produced. It is likely that at least some 

of this concern is due to changes in manufacturing employment,

3 which, in recent years,

has steadily decreased.4This trend, however, pervades internationally and is, to some 

extent, due to significant increases in productivity. Declining employment is easily 

observed by the average individual. Stories of lost jobs, unemployed workers, and 

outsourcing overseas are more common news stories than increases in productivity. 

While employment has decreased, many people would be surprised to learn that General 

Motors employed over 96,000 workers in the U.S. during 20085or that some business 

consultants are advising companies to locate manufacturing plants in the U.S. because it 

is more cost effective.6, 7 And, while there has been concern that semiconductor 

fabrication plants are being moved overseas,8Intel has at least 6 semiconductor 

fabrication plants in the U.S. with one of them being built as recently as 2007. As of 

2010, other companies are building or planning to build additional fabrication plants in 

the U.S.9This does not mean that the U.S. manufacturing industry does not have 

deficiencies, but it does mean that the current state and recent trends of the U.S. industry 

 

1 UNIDO Strategic Research Database. Competitive Industrial Performance Index. 2003. 

<http://www.unido.org/index.php?id=5058>

2

Sirkin, Harold L. “Made in the USA Still Means Something.” Bloomberg Businessweek. April 10, 2009. 

<http://www.businessweek.com/managing/content/apr2009/ca20090410_054122.htm>

3 US-China Business Council. “US Manufacturing: Dying... Or Still Going Strong?” 2006. 

<https://www.uschina.org/public/documents/2006/09/us-manufacturing.pdf>

4 Congressional Budget Office. “Factors Underlying the Decline in Manufacturing Employment Since 

2000.” December 23, 2008. <http://www.cbo.gov/ftpdocs/97xx/doc9749/12-23-Manufacturing.pdf>

5 Carbaugh, Robert J. International Economics. (Mason, OH: South Western Cengage Learning, 2011), 78.

6 Economist. “The Dwindling Allure of Building Factories Offshore.” May 12, 2011. 

<http://www.economist.com/node/18682182?fsrc=rss&story_id=18682182>

7

Sirkin, Harold L. “Manufacturers: Rethink Your Bond with China.” Bloomberg Businessweek. February 

13, 2009. <http://www.businessweek.com/managing/content/feb2009/ca20090213_657126.htm>

8 Center for Public Policy Innovation. “The Decline in Semiconductor Manufacturing in the United States.” 

June 2010. <http://cppionline.org/docs/The-Decline-of-Semiconductor-Manufacturing.pdf>

9

SEMI. Semiconductor, LED, and MEMS Fabs and Foundries. <http://www.semi.org/en/>
2

are not obviously apparent. In addition to employment trends, there are numerous other 

worries concerning the industry: research and development expenditures,10, 11 U.S. labor 

costs, globalization, availability of qualified workers,12 U.S. corporate taxes,13 the ability 

to acquire funding for business ventures, location of industry supply chains,14 and lower 

growth rates to name a few.

Many industry experts have endorsed media claims in suggesting that the U.S. 

manufacturing industry is losing its competitive edge; however, many disagree on what it 

means for a nation to be competitive and what metrics are appropriate for measuring 

competitiveness. Commentary by Tassey, Krugman, and others has illustrated divergent 

views in regard to competitiveness.15, 16, 17, 18, 19, 20 This makes it all the more important to 

track a variety of aspects of the industry. This can be challenging, however, as the 

industry can appear to be contracting or expanding depending on what aspect of the 

industry one is examining and depending on the methods used to adjust industry data.

Employment, for example, has steadily decreased,21 while value added has increased.

Over time manufacturing processes have changed dramatically. Robotic arms and other 

machinery have radically changed the manufacturing environment. For instance, just a 

few decades ago a company such as Standard Motor Products, which produces 

replacement parts for car engines, had a number of employees who were illiterate. Today, 

many of the employees at Standard Motor Products not only need to be able to read, they 

 

10 Tassey Gregory. “Rationales and Mechanisms for Revitalizing U.S. Manufacturing R&D Strategies.” 

Journal of Technology Transfer. 35 (2010): 283-333.

11 Pisano, Gary P. and Willy C. Shih. Restoring American Competitiveness. Harvard Business Review. 

July-August (2009).

12 Committee on Prospering in the Global Economy of the 21st Century: An Agenda for American Science 

and Technology, National Academy of Sciences, National Academy of Engineering, Institute of Medicine. 

“Rising Above the Gathering Storm: Energizing and Employing America for a Brighter Economic Future.” 

National Academies Press. <http://www.nap.edu/catalog.php?record_id=11463>

13 Engardio, Pete. “Can the Future Be Built in America.” Bloomberg Businessweek. April 26, 2009 

<http://www.businessweek.com/magazine/content/09_38/b4147046115750.htm>

14 Bhatnagar, Rohit and Amrik S. Sohal. “Supply Chain Competitiveness: Measuring the Impact of 

Location Factors, Uncertainty and Manufacturing Practices.” Technovation. 25 (2005): 443-456. 

15 Tassey Gregory. “Rationales and Mechanisms for Revitalizing U.S. Manufacturing R&D Strategies.” 

Journal of Technology Transfer. 35 (2010): 283-333.

16 Krugman, Paul. “Making Sense of the Competitiveness Debate.” Oxford Review of Economic Policy. 

Vol. -12 no. 3 (1996): 17-25.

17 Krugman, Paul. “Competitiveness, A Dangerous Obsession.” Foreign Affairs. Vol 73. Num 2. 

March/April (1994): 28-44.

18 US-China Business Council. “US Manufacturing: Dying... Or Still Going Strong?” 2006. 

<https://www.uschina.org/public/documents/2006/09/us-manufacturing.pdf>

19 World Economic Forum. The Global Competitiveness Report. 2010-2011. 

<http://www3.weforum.org/docs/WEF_GlobalCompetitivenessReport_2010-11.pdf>

20 Toder, Eric. “International Competitiveness: Who Competes Against Whom and for What?” Tax Policy 

Center: Urban Institute and Brookings Institution. January (2012). 

<http://www.taxpolicycenter.org/UploadedPDF/412477-international-competitiveness.pdf>

21 Congressional Budget Office. “Factors Underlying the Decline in Manufacturing Employment Since 

2000.” December 23, 2008. <http://www.cbo.gov/ftpdocs/97xx/doc9749/12-23-Manufacturing.pdf>
3

need to know the computer language of the machinery producing the parts.22, 23 The

increase in productivity that is often the result of these changes means fewer employees 

are needed to make the same products, possibly resulting in lower employment levels in 

manufacturing. And, while American manufacturing efficiency is improving, other 

nations have been developing and improving their own manufacturing industries. 

Emerging economies such as China have gone from producing some manufactured goods 

to producing a significant amount of goods. Understanding the current state and recent 

trends of the U.S. manufacturing industry in light of these issues is difficult. Tassey’s 

“Rationales and Mechanisms for Revitalizing U.S. Manufacturing R&D Strategies”24 and 

the commentaries that follow it, illustrate that determining the current and future state of 

U.S. manufacturing is controversial. Some experts have stated that U.S. multinationals 

have “abandoned” the U.S. and their global expansion “tends to ‘hollow out’” U.S. 

operations while exporting jobs abroad. Others counter that operations and investment of 

U.S. multinationals are highly concentrated in the U.S. and maintain a large presence 

while increasing overseas activities.25, 26, 27 Determining the current state and recent 

trends of the U.S. manufacturing industry is complex and there is a need for an 

assemblage of data that measures components of the industry.

1.2 Purpose

The purpose of this report is to track domestic manufacturing activity in order to develop

a quantitative depiction of U.S. manufacturing in context of the global industry. The 

report first discusses the primary data available on the industry, both nationally and 

internationally, and then provides a synopsis of the data. As displayed in Table 2.3, 

numerous sources of data are used to depict the manufacturing industry, including data 

from the Organization for Economic Co-operation and Development (OECD), United 

Nations (UN), and U.S. Bureau of Labor Statistics (BLS). There are two aspects that can 

be discussed that relate to the U.S. manufacturing industry. The first includes the trends 

and current state of the industry. This includes the quality and quantity of production 

along with expenditures on research and development activities. The second is the 

environment in which the manufacturing industry must operate. This includes taxes, 

regulations, infrastructure, the labor market, and current economic conditions among

other things. This report largely focuses on the current state and recent trends of U.S. 

 

22 Davidson, Adam. “The Transformation of American Factory Jobs, In One Company.” NPR. January 13, 

2012. <http://www.npr.org/blogs/money/2012/01/13/145039131/the-transformation-of-american-factoryjobs-in-one-company?ft=1&f=100>

23 Davidson, Adam. “Making It in America.” The Atlantic. January/February (2012). 

<http://www.theatlantic.com/magazine/archive/2012/01/making-it-in-america/8844/?single_page=true>

24 Tassey Gregory. “Rationales and Mechanisms for Revitalizing U.S. Manufacturing R&D Strategies.” 

Journal of Technology Transfer. 35 (2010): 283-333.

25 Slaughter, Matthew J. “How U.S. Multinational Companies Strengthen the U.S. Economy.” United 

States Council for International Business. (March 2010). 

<http://www.uscib.org/docs/foundation_multinationals.pdf>

26 National Science Foundation. “Asia’s Rising Science and Technology Strength.” May 2007. 

<http://www.nsf.gov/statistics/nsf07319/>

27 Sirkin, Harold L. “Made in the USA Still Means Something.” Bloomberg Businessweek. April 10, 2009. 

<http://www.businessweek.com/managing/content/apr2009/ca20090410_054122.htm>
4

manufacturing domestically and as compared to its international counterparts such as 

major trading partners and those countries that are often considered as competitors. 

1.3 Scope and Approach

This report brings together multiple datasets on the current state of the U.S. 

manufacturing industry. It then uses various strategies to compare these data 

internationally to develop a quantitative depiction of the U.S. manufacturing industry in 

context of its international counterparts. Data and information on the manufacturing 

industry is extensive. Understanding these resources and identifying the relevant statistics 

that can be extracted from them requires both familiarity with and an understanding of 

industry data. In order to understand the current state and recent trends in manufacturing, 

data is needed on both the domestic and international manufacturing industries. There are 

many sources of information that provide data on individual nations. Unfortunately, 

identifying, adjusting, and accumulating these data would require a considerable amount 

of time and resources. Therefore, this report relies on sources that provide data on 

multiple nations to make international comparisons. However, in depth data on the U.S. 

is used to understand the details of the domestic manufacturing industry. In order to make 

meaningful comparisons of international data a variety of factors, such as population and 

exchange rates, need to be considered. For instance, the U.S. may be the largest producer 

of manufactured goods in the world; however, it may not be the largest on a per capita 

basis. These types of issues are important in examining U.S. manufacturing.

National economies are often compared to companies competing for market share. This is 

a common analogy made when discussing the U.S. manufacturing industry; 

unfortunately, this comparison can be rather misleading.28, 29, 30, 31, 32 A national economy 

is the primary supplier of goods and services to its labor force while a single company, 

generally, is not the primary supplier of goods and services to its employees. 

Additionally, a national economy provides the income for the majority of the nation’s

consumers while a business, generally, does not provide the income for the majority of its 

customers. Moreover, a national economy represents a system of exchange in which a 

company operates as one entity of that system. Companies can go out of business while 

 

28 Krugman, Paul R. “Making Sense of the Competitiveness Debate.” Oxford Review of Economic Policy. 

Vol 12, no. 3 (1996): 17-25. Paul Krugman won the 2008 Nobel Memorial Prize in Economic Sciences for 

his work on international trade and economic geography.

29 Krugman, Paul R. “Competitiveness, A Dangerous Obsession.” Foreign Affairs. Vol 73. Num 2. 

March/April (1994): 28-44.

30 The World Economic Forum defines competitiveness of a nation as “the set of institutions, policies, and 

factors that determine the level of productivity of a country.” This definition relates to productivity and is 

not consistent with the idea of countries competing for market share. World Economic Forum. The Global 

Competitiveness Report. 2010-2011. 

<http://www3.weforum.org/docs/WEF_GlobalCompetitivenessReport_2010-11.pdf>

31 Porter, Michael E. The Competitive Advantage of Nations. 1st ed. (New York: The Free Press, 1990).

32 Porter asserts that competitiveness is measured by productivity and that measuring a country’s 

competitiveness as its share of world markets is “deeply flawed.” Porter, Michael E. “Building the 

Microeconomic Foundations of Prosperity: Findings from the Business Competitiveness Index.” In Porter, 

Michael E., Klaus Schwab, Xavier Sala-i-Martin, and Augusta Lopez-Claros. The Global Competitiveness 

Report 2003-2004. (New York: Oxford University Press, 2004).
5

nations do not. Domestic demand for goods and services constitutes a great proportion of 

the demand for a nation’s domestically-produced products where the demand for goods 

and services from a company is primarily external. In addition to these analogies, 

frequently, anecdotal observations are used to characterize the manufacturing industry;33

however, the insight from these types of observations is somewhat limited, as the 

manufacturing industry includes hundreds of thousands of establishments with millions 

of employees making trillions of dollars worth of goods. Anecdotal observations provide 

a limited narrow scope of the industry that does not necessarily reflect or apply to the 

industry as a whole. This report will largely avoid these types of comparisons and 

anecdotes as they can add confusion to complex matters. This approach reduces the 

possibility of mischaracterizing the industry and provides an evidence-based depiction of 

the manufacturing industry and its subsectors.

Although this report depicts the manufacturing industry with a focus on medium- and 

high-tech industry, the sectors included in these categories are only generally identified. 

There does not seem to exist a well-established criteria for identifying what types of 

manufacturing are high-tech, medium-tech, or low-tech; however, the definition by the 

OECD is commonly used, which utilizes research and development intensities.34 It is 

often the case that authors refer to medium- and high-tech manufacturing and simply 

specify the industries to which they are referring. For the purpose of this report, mediumtech manufacturing includes chemical, mechanical, and electronic equipment 

manufacturing while high-tech manufacturing includes computer and related product 

manufacturing, which is consistent with the definition provided in the RAND Technical 

Report on High Technology Manufacturing and with the definition used by the United 

Nations Industrial Development Organization.35 This broader definition allows for an 

examination of medium- and high-tech industries while also being able to examine the 

manufacturing industry as a whole. It also allows for a more general comparison between 

countries, as international data is often limited.

This report begins by identifying stakeholders and metrics for the manufacturing

industry. It is then followed with a presentation of international and domestic data

relating to stakeholder’s vested interests. International data tends to be broader in nature, 

which allows for some comparison of U.S. manufacturing to its international 

counterparts. Although limited in nature, this comparison provides critical context in 

which to view the U.S. manufacturing industry and its subsectors. In contrast, domestic 

data is much more detailed in nature, which allows for a more comprehensive discussion 

on medium and high tech manufacturing. Following the chapters on international and 

domestic data is a chapter that discusses the data as a whole in order to characterize the 

 

33 Greenwald, Bruce C.N. and Judd Kahn. Globalization: The Irrational Fear that Someone in China will 

Take Your Job. (Hoboken, NJ: John Wiley & Sons 2009). 

34 OECD. “Measuring Globalisation: OECD Handbook on Economic Globalisation Indicators.” May 2005. 

<http://www.oecd-ilibrary.org/economics/measuring-globalisation-oecd-handbook-on-economicglobalisation-indicators-2005_9789264108103-en >

35 Kelley, Charles, Mark Wang, Gordon Bitko, Michael Chase, Aaron Kofner, Julia Lowell, James 

Mulvenon, David Ortiz, and Kevin Pollpeter. “High-Technology Manufacturing and U.S. 

Competitiveness.” RAND Technical Report. March 2004. 

<http://www.rand.org/pubs/technical_reports/2004/RAND_TR136.pdf>
6

U.S. manufacturing industry. The final chapter discusses data needs. The report includes 

five appendices. Appendix A and Appendix B present two competitiveness indices. 

Appendix C and Appendix D provide detailed data from the Annual Survey of 

Manufactures while Appendix E contains a glossary of terms. 
7

2 Manufacturing Industry Stakeholders, Metrics, and 

Data

To track the current state and recent trends in the U.S. manufacturing industry it is 

necessary to determine what types of data are relevant and provide some context for the 

data. There are many datasets that track the U.S. manufacturing industry, but they do not 

all have equal importance. This report identifies manufacturing industry stakeholders and 

tracks stakeholder costs and benefits. To provide context to the level of costs and 

benefits, they are compared to their international counterparts. 

Individual manufacturing stakeholders are affected by the industry in different ways. 

Therefore, it is useful to identify individual stakeholders and classify them into 

stakeholder groups. This classification can then be used to identify the primary 

investment each stakeholder has in the manufacturing industry along with their expected 

return. Stakeholders evaluate benefits and costs of manufacturing industry investments 

purely from their “stakeholder” point of view; therefore, it is important to identify each 

stakeholder’s investment and expected return. These “points of view” can provide some 

guidance as to what metrics might be used to characterize the manufacturing industry. 

2.1 Manufacturing Industry Stakeholders

There are a number of stakeholders for the manufacturing industry. The most direct and 

obvious ones are the owners and employees; these are the individuals directly responsible 

for production. As seen in the manufacturing supply chain in Figure 2.1, there are many 

suppliers of goods and services that also have a stake in the industry; these include 

resellers, providers of transportation and warehousing, raw material suppliers, suppliers 

of intermediate goods, and suppliers of professional services. The items in the figure 

colored in blue represent suppliers of services, computer hardware, software, and other 

costs. Gold represents refuse removal, intermediate goods, and recycling while orange 

represents machinery, structures, and compensation with red being the repair of the 

machinery and structures. Green represents the suppliers of materials. These items all 

feed into the design and production of manufactured goods which are inventoried and/or 

shipped. The depreciation of capital and net income are also included in the figure, which 

affect the market value of shipments. In addition to the stakeholders in the figure, there 

are also public vested interests, the end users, and financial service providers. 

As seen in Table 2.1, stakeholders may have a direct investment in manufacturing, such 

as industry owners and employees, or an indirect investment through supply chains or 

industry outputs. Each stakeholder is associated with a primary form of investment. For 

example, employees invest their labor while owners invest land and capital. Owners often 

have labor and/or intellectual property invested as well; however, their primary 

investment is in the form of land and capital as seen in Table 2.1. Each stakeholder has 

invested these items with the expectation of receiving compensation or a return on 

investment. Employees, for instance, expect to be compensated for their labor and owners 
8

Figure 2.1: Manufacturing Supply Chain
9

Table 2.1: Stakeholders

Stakeholders Affiliation Primary Investment Expected Return

Owners Private Producers Land, Capital Goods, and Financial Capital Profit From Sales

Employees (manufacturing industry and suppliers) Laborers Labor Income

Resellers Private Distributer Land, Capital Goods, and Labor Profit From Markup

Retailers Private Distributer Land, Capital Goods, and Labor Profit From Markup

Wholesalers Private Distributer Land, Capital Goods, and Labor Profit From Markup

Standards and Codes Organizations Public/Private Interest Labor and Intellectual Property Economic Success

Transportation and Warehousing Support Service Land, Capital Goods, and Labor Profit From Fees

Air Transportation Providers Transportation Land, Capital Goods, and Labor Profit From Fees

Ground Transportation Providers Transportation Land, Capital Goods, and Labor Profit From Fees

Warehousing and Storage Providers Storage Facility Land and Capital Goods Profit From Fees

Professional Societies Public/Private Support Services Labor and Intellectual Property Economic Success and Profit from Fees

Finance Services Insurance and Finance Financial Capital Profit From Fees

Insurance Providers Insurance Financial Capital Profit From Fees

Health and Medical Insurance Providers Insurance Financial Capital Profit From Fees

Financiers Financier Financial Capital Capital Gains

Public Vested Interests Public Labor and Financial Capital Economic Success

Policy Makers Public Labor and Financial Capital Economic Success

Tax Payers Public Financial Capital Economic Success

Industry Suppliers Public/Private Suppliers Land, Capital Goods, and Labor Profit 

Mining Material Suppliers Private Suppliers Land, Capital Goods, and Labor Profit From Sales

Agriculture Product Suppliers Private Suppliers Land, Capital Goods, and Labor Profit From Sales

Electric Utility Suppliers Private Suppliers Land, Capital Goods, and Labor Profit From Sales

Water Utility Suppliers Public/Private Suppliers Land, Capital Goods, and Labor Profit From Sales

Natural Gas Suppliers Private Suppliers Land, Capital Goods, and Labor Profit From Sales

Facility Construction Providers Private Suppliers Land, Capital Goods, and Labor Profit From Sales

Maintenance and Repair Providers Private Suppliers Land, Capital Goods, and Labor Profit From Sales

Communication Services Providers Private Support Services Land, Capital Goods, and Labor Profit From Fees

Other Fuel Suppliers Private Suppliers Land, Capital Goods, and Labor Profit From Sales

Refuse Removal Service Providers Private Support Services Land, Capital Goods, and Labor Profit From Fees

Professional Services Public/Private Support Services Land, Capital Goods, Labor, and Intellectual Property Profit From Fees

Legal Service Providers Public/Private Support Services Labor Profit From Fees

Information Service Providers Private Support Services Land, Capital Goods, and Labor Profit From Fees

Research Organizations Public/Private Suppliers Labor and Intellectual Property Profit From Fees

Accounting Service Providers Private Support Services Labor Profit From Fees

Engineering Service Providers Private Support Services Labor and Intellectual Property Profit From Fees

Computer Service Providers Private Support Services Labor Profit From Fees

Scientific and Technical Service Providers Private Support Services Labor and Intellectual Property Profit From Fees

Advertisers Private Support Services Labor and Intellectual Property Profit From Fees

Other Professional Services Private Support Services Labor and Intellectual Property Profit From Fees

Consumers End User Product Purchasing Price Final Product Utilization
10

expect to receive a profit. There are six different categories of assets used in Table 2.1

that can be vested into the industry: financial capital, capital goods, land, labor, 

intellectual property, and the end users purchasing price. A successful industry might be 

considered one that has a suitable magnitude of production that results in competitive net 

benefits for its stakeholders. The expected returns from the industry include profits from 

sales, markup, or fees; income; industry success; capital gains; and utility from the final 

use of the product. The expected returns for each stakeholder are categorized in Table 

2.1.

Summary of Primary Investments

Land: Naturally-occurring goods such as water, air, soil, mineral, and flora used in the 

production of products (i.e., the totality of goods or services that a company makes 

available).

Labor: Human effort used in production, which includes technical and marketing 

expertise.

Capital Goods: Human made goods used in the production of products.

Financial Capital: Funds provided by investors to purchase capital goods for production

of products.

Intellectual Property: Ideas, trademarks, copyrights, trade secrets, and patents used to 

produce products

Purchasing Price: Market value of products sold

Summary of Expected Returns

Profit from sales: The financial benefit realized when revenues exceed costs and taxes for 

a product.

Capital Gains: An increase in the value of a capital asset

Income: Compensation for an individual’s service or labor

Profit from Markup: The difference between the cost of a product and its selling price.

Economic Success: A constant and suitable magnitude of production resulting in 

competitive benefits (profits, capital gains, income, and product utilization) for an 

industry’s stakeholders.

Profit from Fees: The financial benefit realized when revenues exceed costs and taxes for 

a service.
11

Final Product Utilization: The utility gained from the end user of a product.

2.2 Manufacturing Industry Metrics and Data

As previously discussed, a successful industry might be considered one that has a suitable 

magnitude of production that results in competitive net benefits for its stakeholders; 

however, measuring the magnitude of production as well as the benefits for stakeholders 

is complicated. It is not clear what level of production is a suitable magnitude of 

production. A suggested approach is to compare U.S. production to production in other 

developed and emerging economies, which will provide context for U.S. levels of 

production. For example, the decline of U.S. production of product x may appear as 

though U.S. manufacturing is moving to other nations; however, production of product x 

may be declining globally and may have little to do with the health of the U.S. 

manufacturing industry. Alternatively, the U.S. may be declining in production of 

product x, but is increasing its production of product y in its place. In light of these 

possibilities it is important to determine the context of production levels of U.S. 

manufacturing. 

In addition to measuring production levels, it is also useful to measure stakeholder’s costs 

and benefits. These costs and benefits, like production levels, also require context and 

comparison to other developed and emerging economies. Furthermore, there are many 

stakeholders involved, as seen in Table 2.1. Each stakeholder has costs and benefits that 

may or may not have well-developed metrics and available data. Furthermore, the data 

must be separated to reflect national and international costs and benefits. For example, in 

order to examine retailer’s and wholesaler’s costs and benefits from the U.S. 

manufacturing industry, the costs and benefits to retailers and wholesalers of 

domestically produced products must be separated from products produced abroad. In 

many instances, this type of data is not fully developed; however, there are some 

estimates that can be made using Leontief’s input-output model. 36 As seen in Table 2.2, 

there are a number of metrics available for each stakeholder’s benefits and costs. In 

regards to manufacturing, several types of expected returns have well established datasets 

that can be utilized. The remaining ones must often be measured using indirect metrics. 

There are three aspects of U.S. manufacturing data to consider: (1) how the current 

industry compares to other countries, (2) the trends in the domestic industry, and (3) the 

industry trends compared to other countries trends. A number of data sets must be 

utilized to make these comparisons; however, the various data sets available are not all 

published in the same format. International data tends to be in the International Standard 

Industrial Classification (ISIC) version 3.1, a revised United Nations system for 

classifying economic data. Manufacturing is broken into 23 major categories (ISIC 15 

through 37) with additional subcategories. For the purposes of this report, categories 15 

through 22 are often aggregated; these include food, beverages, tobacco, textiles, apparel, 

 

36 Miller, Ronald E. and Peter D. Blair. Input-Output Analysis: Foundations and Extensions. (New York: 

Cambridge University Press, 2009): 16.
12

Table 2.2: Stakeholder's Expected Returns and Associated Metrics

leather, wood, and media products. This allows for more detailed analysis of mediumand high-tech products. Domestic data tends to be in the North American Industry 

Classification System (NAICS). It is the standard used by Federal statistical agencies 

classifying business establishments in the U.S. NAICS was jointly developed by the U.S. 

Economic Classification Policy Committee, Statistics Canada, and Mexico’s Instituto 

Nacional de Estadistica y Geografia and was adopted in 1997. Similar to ISIC, NAICS 

has several major categories each with subcategories. Historic data and some 

organizations continue to use the predecessor of NAICS, which is the Standard Industrial 

Classification system. 

As seen in Table 2.3, there are a number of sources for data both domestically and 

internationally. Domestic sources include the U.S. Census Bureau, Bureau of Economic 

Analysis (BEA), National Science Foundation (NSF), and Bureau of Labor Statistics 

(BLS). International sources include the United Nations (UN), the Organization for 

Economic Co-operation and Development (OECD), World Economic Forum, and the 

International Institute for Management Development’s (IMD) World Competitiveness 

Center. There are, of course, additional sources of data; however, those listed in Table 2.3

are many of the most prominent and cited sources of data on the domestic and 

international manufacturing industries. 

Industry data being compared over time or between national currencies must be adjusted 

to a common comparable metric. Time series data is adjusted for inflation using a price 

Expected Return Description Contributing factors Primary Metrics

Sales

Revenue (sales) Labor costs and/or wages

Labor costs and/or wages Capital expenditures

Cost of land Value added per expenditure dollar

Cost of capital Value added per unit of labor

Productivity Productivity indices

Capital Gains

Compensation for the use of 

assets

Rate of return Interest rates

Labor costs and/or wages

Value added per unit of labor

Productivity indices

Number of employed workers

Costs Costs

Sales Sales

Industry value added

Production Subsector value added

Productivity Research and development expenditures

Product quality Innovation metrics (patents and journal articles)

Technological intensity Productivity

Product quality metrics

Sales

Revenue (sales) Labor costs and/or wages

Labor costs and/or wages Capital expenditures

Cost of land Value added per expenditure dollar

Cost of capital Value added per unit of labor

Productivity Productivity indices

Value of products supplied

Price Consumer Price Index

Quality Product quality metrics

Technological intensity Research and development expenditures

Innovation metrics (patents and journal articles)

Final product utilization Utility

Profit from fees and sales by 

non-manufacturing industries

Profit (revenue less production 

costs) from products purchased 

from non-manufacturing 

industries

Productivity

Profit from sales (owners) Revenue less production costs

Compensation for labor 

(manufacturing industry and 

suppliers)

Income

Economic Success

Levels of production and 

productivity that result in 

economic prosperity

Profit from Markup Market selling price less cost
13

index. The most suitable price index for tracking trends in the physical volume of

production is the producer price index for the specific industry being discussed as it 

reflects the average change in the selling prices received by domestic producers for their 

output. It is typically used to measure real growth in output.37 However, industry specific 

producer price indices may not cover the entire span of time being discussed. In these 

cases, an approximation is used if the missing time span is relatively short. If the missing 

data spans a longer period of time, a closely related producer price index is selected. It is 

important to note that when multiple time series industry data are adjusted using different 

price indices the values no longer represent proportional changes in the value of 

production between industries. There are two primary factors that affect the aggregate 

value of manufactured goods: the physical volume of goods and the price (i.e., the 

product of price and physical volume equals aggregate value of goods). Data adjusted 

using the same price index accurately reflects proportional changes in the value of 

production because the original proportional magnitude is maintained between industries; 

however, it does not accurately reflect changes in the volume of production for each 

industry over time (e.g., declining cost of computer and electronic products). Thus, 

caution should be used when discussing the trends in manufacturing over time as the 

price index used to adjust manufacturing industry and subsector data can have a 

significant effect on the appearance of these trends. For this report, if a producer price 

index is not available then a consumer price index is used. In addition to adjusting for 

inflation, data in different currencies must be converted to a common currency. Some 

data sets used in this report, such as data from the United Nations Statistics Division 

(UNSD), are already converted to U.S. dollars using the International Monetary Fund’s 

(IMF) market exchange rates. Other data sets, such as that from the OECD, are not 

converted. These data were converted using the OECD purchasing power parity (PPP) 

rates. This conversion eliminates the differences in price levels between countries; thus, 

in effect the resulting values reflect only differences in the volume of goods and services 

purchased. In some cases the time span of the data extends beyond OECD PPP data 

availability; therefore, the PPP rate from the Center for International Comparisons at the 

University of Pennsylvania was used.

 

37 Bureau of Labor Statistics. “Producer Price Indexes: How Does the Producer Price Index Differ from the 

Consumer Price Index.” <http://www.bls.gov/ppi/ppicpippi.htm>
14

Table 2.3: Sources of Data

Domestic Data and Information International Data and Information

Annual Survey of Manufactures (U.S. Census 

Bureau)

Gross Domestic Product (UN)

Economic Census (U.S. Census Bureau) Manufacturing Value Added (OECD)

Gross Domestic Product (BEA) Manufacturing Value Added (UN)

Manufacturers' Shipments, Inventories, and Orders 

(U.S. Census Bureau)

Competitive Industrial Performance Index (UN)

Foreign Trade (U.S. Census Bureau)

Research and 

Development

Research and Development (National Science 

Foundation)

Research and Development Expenditures (OECD)

Producer Price Index (BLS) Unit Labor Costs (OECD)

Manufacturing Employment (BLS) Labor Compensation per Employee (OECD)

Productivity Index (BLS) Labor Compensation per hour (OECD)

Pay and Benefits (BLS) Hours Worked in Manufacturing (OECD)

Education Attainment (OECD)

Employment (UN)

Wages (UN)

Population (U.S. Census Bureau International 

Database)

Research and Development (National Science 

Foundation)

Patent Applications (OECD)

Percent of Patents that are Foreign Owned (OECD)

Global Competitiveness Report (World Economic 

Forum)

Competitiveness Yearbook (IMD World 

Competitiveness Center)

Production 

and Processes 

of Production

Labor

Technology

All Categories
15

3 International Data: How the U.S. Compares to the Rest of 

the World

This chapter discusses international data, which includes data on production in the U.S. 

and abroad. It lays out the principal data available on the manufacturing industry and then 

discusses the definitions used and trends in the data. There are many sources of 

information that provide data on individual nations. Unfortunately, identifying, adjusting, 

and accumulating this data would require a considerable amount of time and resources. 

Therefore, this report relies on sources that provide data on multiple nations to make 

international comparisons. These sources include the United Nations, Organization for 

Economic Cooperation and Development, World Bank, and a selection of international 

comparative indices. 

As previously discussed, a successful industry might be considered one that has a suitable 

magnitude of production that results in competitive net benefits for its stakeholders. It is 

on this basis that data was selected to be incorporated into this chapter. Data was selected 

to compare net benefits of U.S. stakeholders to those abroad. This includes the total value 

added, net income, compensation, and employment among other things. Without this 

comparison, it is difficult to find meaning in many of the trends in U.S. manufacturing. 

For instance, it is difficult to argue that one rate of growth is sound and another rate is 

unsound without some comparison to the international community. In some instances 

rankings or percentiles are used to compare U.S. stakeholders to those abroad. Data 

related to research and development expenditures are also presented as these items reflect 

advancements in the industry. 

It is important to note that although the U.S. proportion of research and production 

activities has declined, it is necessary to examine the nation’s nominal and real 

performance relative to its population and resources to gain an understanding of what is 

happening. It should be expected that as emerging economies make progress in becoming 

developed countries that U.S. and other developed nation’s proportion of production and 

research will decline due to the growth of total global production and research 

activities.38 That is, it is not to be expected that the U.S. will keep up with the aggregate 

growth of global research and production as much of these increases are the result of 

utilizing previously idle or under-utilized resources in emerging economies. A decline in 

the proportion of U.S. activities, therefore, is not unexpected and is not necessarily a 

decline in the performance of the domestic industry. A greater concern is its nominal and 

real performance relative to its population and/or resources. It is in this context that this 

report will compare U.S. manufacturing activity to that of other nations.

 

38 Mandel, Benjamin R. “Why is the U.S. Share of World Merchandise Exports Shrinking.” Federal 

Reserve Bank of New York: Current Issues. Vol. 18, No. 1. 2012. 

<http://www.newyorkfed.org/research/current_issues/ci18-1.pdf>
16

3.1 United Nations

The United Nations (UN) is an international organization founded by 51 nations in 1945; 

the organization now has 193 member states. In addition to its commitment to 

maintaining peace and security, the UN compiles and disseminates statistical information 

on the global economy. It provides these statistics through the United Nations Statistics 

Division and the United Nations Industrial Development Organization. Data from these 

two entities are characterized below. 

United Nations Statistics Division (UNSD) National Accounts Main Aggregates

Database: The UNSD disseminates global statistics, develops standards for statistical 

activities, and provides assistance to nations developing statistical data. Their National 

Accounts Main Aggregates Database provides annual collections of official national 

accounts data. This information is collected via the United Nations National Accounts 

Questionnaire. For some countries a full set of official data is not reported. For these 

instances estimation procedures are employed to estimate the data. These data were

converted from national currencies into U.S. Dollars by applying market exchange rates 

as reported by the International Monetary Fund (IMF).

39

According to the UNSD data, as of 2008, the U.S. produced the largest volume of 

manufactured goods compared to all nations as seen in Figure 3.1. This figure contains 

manufacturing value added for the ten largest manufacturing nations and illustrates the 

magnitude and importance of the U.S. manufacturing industry to the global economy as 

well as the domestic economy. China produced about 2% less than the U.S. in 2008, but 

is expected to continue to grow rapidly. As seen in the pie charts in Figure 3.1, the U.S. 

produced 28 % of the worlds manufactured goods in 1985 and declined to 18 % in 2008. 

Although significant, this decline may not be a point of concern. It is important to note 

that in order for underdeveloped countries to become developed countries, their 

production and income will need to approach that of the developed world. This, 

inevitably, results in a decline in the proportion or market share that each developed 

country represents. Thus, a decline in the U.S. share of global manufacturing is not by 

itself a point of concern. A decline may simply be the result of progress in emerging 

economies. Concern about such a decline often stems from the misleading analogy of the 

U.S. being compared to a company losing market share. When companies expand their 

market share it is often at the cost of another company. When an emerging economy 

increases production, however, it creates more demand for goods and services which 

increases the total market size. Thus, the increase in market share from increased 

production in one country may or may not be at the cost of another country.

Between 1985 and 2008, the U.S. manufacturing industry grew at a compound annual 

growth rate of approximately 1.1 %, according to UN data; consequently, it is growing 

slower than the whole of the U.S. economy, which grew at a 2.3 % rate. Manufacturing in 

Canada, Japan, Germany, and the U.K grew faster at rates of 2.7 %, 1.9 %, 3.6 % and 

 

39 United Nations Statistics Division. “National Accounts Main Aggregates Database.” 

<http://unstats.un.org/unsd/snaama/Introduction.asp>
17

Figure 3.1: UNSD Manufacturing GDP by Nation ($billions 2009)

Note: Converted to U.S. dollars using market exchange rates as reported by the International Monetary 

Fund (IMF) and adjusted to 2009 dollars using the BLS producer price index for manufacturing. UNSD 

data begins in 1970; however, the producer price index begins in 1985.

Note: The pie charts represent the percent of global manufacturing GDP that each nation represents for the 

year indicated.

2.8 % respectively. India and China grew much faster at rates of 5.1 % and 9.8 %; 

emerging economies, such as these, can employ idle or underutilized resources and adopt 

technologies that are already proven in other nations to achieve high growth rates. 

Developed countries are already utilizing resources and are employing advanced 

technologies; thus, comparing U.S. growth to growth in China or India has limited

meaning.

U.S. manufacturing growth from 1985 to 2008 is among the slowest with 151 out of 180 

countries having a larger compound annual growth rate, putting it below the 20th

percentile (see Figure 3.2). It is important to note, however, that the U.S. was in the midst 

of a recession in 2008; therefore, it is useful to examine growth to the peak of U.S. 

0

500

1000

1500

2000

2500

3000

3500 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 $ Billions 2009

Republic of Korea

Brazil

Russian Federation

France

United Kingdom of Great 

Britain and Northern Ireland

Italy

Germany

Japan

China, People's Republic of

United States

Other

2 % 2 %3 % 3 % 3 %

4 %

7 %

10%

17% 18%

31%

1 % 2 % 0 % 3 % 3 % 4 %

7 %

13%

28% 4 %

35%
18

Figure 3.2: UNSD Manufacturing Value Added for 180 Countries, Compound Annual Growth Rate 

(1985-2008)

manufacturing. Accordingly, the industry grew 45 % between 1985 to the peak of U.S. 

manufacturing in 1999. At least 156 countries had larger growth from 1985 to their 

manufacturing peak (growth from 1985 to the highest level of manufacturing for each 

country); this puts the U.S. below the 15th percentile of 182 nations.

While manufacturing value added is larger in the U.S. than in any other country, U.S. 

manufacturing per capita has lagged slightly behind some industrialized nations, such as 

Germany and Japan. Out of 199 countries, at least 20 other nations had a higher 

manufacturing value added per capita than the U.S. in 2008, according to UNSD data. 

This ranking is down from being 2nd in 1985. Between 1985 and 1995, the rank had 

slipped to 16th; however, it slowly climbed to 7th between 1995 and 2000. From there it

slowly declined to 21st in 2008. As illustrated in Figure 3.3, U.S. per capita 

manufacturing value added has fluctuated slightly between 1985 and 2008; however, the 

level in 2008 is only 1.5 % higher than it was in 1985. Many countries had much higher

increases; such as Germany and the United Kingdom, which increased 114.9 % and 

72.1 %, respectively. Out of 172 countries, the U.S. ranks as the 130th largest increase, 

putting it below the 25th percentile.

Manufacturing as a percent of total Gross Domestic Product (GDP) has declined in the 

U.S. as it has declined in many industrialized nations across the globe. In 1970, 

manufacturing was approximately 24.3 % of U.S. GDP. By 2008, it represented 

approximately 13.0 % as illustrated in Figure 3.4, which contains the same top ten 

manufacturing nations shown in Figure 3.1. During this same period, total manufacturing 

GDP for all countries for which data is available went from 26.7 % to 17.1 % of total

GDP. This percentage declined for 111 out of 179 countries (62.0 %). In 1970, 

approximately 87.0 % of 185 countries listed in the UNSD data had a lower 

manufacturing to GDP ratio than the U.S. In 2008, approximately 59.8 % of 209 had a 

lower ratio.

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

Coumpound Annual Growth

Germany

China

United 

States

United 

Kingdom

50th 

Percentile

75th 

Percentile

India

Germany

China

United 

States

United 

Kingdom

50th 

Percentile

75th 

Percentile

India

25th 

Percentile
19

Figure 3.3: UNSD Manufacturing GDP per Capita

Note: population data is based on U.S. Census Bureau estimates of international population

United Nations Industrial Development Organization’s (UNIDO) Statistical Country 

Briefs: The Statistical Country Briefs include national account data and industrial 

statistics compiled from various databases maintained by UNIDO. Industrial data on 

manufacturing are defined at the two (sometimes three) digit level of the International 

Standard Industrial Classification, Revision 3 (ISIC Rev. 3) system. National data has 

been converted to current U.S. dollars using the average period exchange rate in the IMF 

International Financial Statistics.40

Manufacturing employees exchange their time for income or wages. U.S. wages in the 

manufacturing industry are not the highest; however, they are not the lowest either. 

Among the nations shown in Table 3.1, the U.S. had the second highest level of wages 

slightly behind Germany, in 2006. This is the case for many of the subsectors shown in 

the table. Among those subsectors shown, the U.S. has the highest wages for other 

chemical product manufacturing, insulated wire and cable manufacturing, television and 

radio transmitter manufacturing, and transport equipment manufacturing. It is important 

to note that China’s wages are among the lowest.

U.S. manufacturing industry stakeholders rely not only on the size of the industry, but the 

technology level of the products being produced. UNIDO data provides an opportunity to 

compare various aspects of U.S. manufacturing to other nations. Unfortunately, access to 

UNIDO data for all nations is somewhat limited; therefore, a selection of countries is 

used in Table 3.2 for comparison. These countries represent major U.S. trading partners, 

 

40 UNIDO. “Statistical Country Briefs.” <http://www.unido.org/index.php?id=1000313>

0

2000

4000

6000

8000

10000

12000

14000

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

$2009 Per Capita

Brazil

Russia

China

South Korea

France

United Kingdom

Italy

United States

Germany

Japan
20

Figure 3.4: UNSD Manufacturing as a Percent of GDP (1970-2008)

countries that are often considered competitors with the U.S., and nations that are similar 

to the U.S. As seen in Table 3.2, data are unavailable for some industries for some 

countries. Among the countries shown in the table, the U.S. has the largest value added 

for ISIC codes 24, 25, 26, 28, 29, 30, 31, 32, 33, and 34-35 (note that data for ISIC 15-22, 

23, and 36-37 are unavailable for the U.S.). In terms of the percent of total national value 

added, the U.S. is within 11 percentage points of all the countries listed for all the types 

of manufacturing listed with the largest gaps being in ISIC codes 24, 27, 29, and 34-35. 

The total value added, value added per capita, and value added per employee for all 

manufacturing exceeds that of all the other countries listed as is the case for ISIC codes 

24, 30, and 33. China, however, has more employees involved with all types of 

manufacturing listed in the table while having a lower value added. This employment 

phenomenon may be a result of Chinese labor laws, the remnants of a command 

economy, or the types of products being produced.

41 For the U.S., chemical 

manufacturing represents the largest percent of total value added for those industries 

shown with transportation being the second largest. 

Per capita value added for all manufacturing is larger in the U.S. than the other countries 

listed in Table 3.2. The largest per capita sector of U.S. manufacturing is chemical 

manufacturing. Among the countries listed, the U.S. has the highest per capita 

manufacturing for ISIC codes 24, 26, 30, and 33. U.S. Employment in manufacturing 

exceeds that of Germany, India, Japan, Mexico, and the United Kingdom; however, 

 

41 Shepherd, Robert J. “The People’s Dynasty: Culture and Society in Modern China.” Modern Scholar. 

Lecture Series. (2010).

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

1970

1973

1976

1979

1982

1985

1988

1991

1994

1997

2000

2003

2006

France

United States

United Kingdom

All Countries

Russian Federation

Italy

Brazil

South Korea

Germany

Japan

China
21

China has more than five times as many employees. China’s large employment numbers 

result in very low value added per employee, which is approximately 10 % of the

corresponding value for total manufacturing in the U.S. Among those listed, the U.S. has 

the largest value added per employee for ISIC codes 24, 25, 30, 31, 33, and 34-35. 

Table 3.1: Annual Wages by Select Manufacturing Subsectors, $2006 (UNIDO Statistical Country 

Briefs)

Note: The green bars represent a visual comparison between countries. For example, the UK has the 

highest annual wages for ISIC 241; therefore, it has the longest bar for ISIC 241.

ISIC United States Australia Canada China Germany India Japan Mexico UK

241 Basic chemicals 65 446 23 435 44 103 2 961 51 943 3 543 53 073 14 705 137 197

242 Other chemical products 59 745 21 470 35 966 3 373 57 691 2 223 45 239 8 845 55 913

243 Man-made fibres 44 316 - 33 839 2 657 52 736 3 420 45 650 5 977 54 290

291 General-purpose machinery 47 230 - 35 203 3 132 53 395 2 823 35 743 4 970 45 267

292 Special-purpose machinery 50 827 18 472 34 600 3 074 50 892 2 670 30 779 5 619 45 282

293 Domestic appliances n.e.c. 37 923 17 638 29 843 3 043 53 630 1 833 35 212 4 984 40 303

300 Office, accounting, and computing machinery 59 817 11 343 37 729 4 147 70 390 3 480 43 515 5 320 45 685

311 Electric motors, generators, and transformers 38 990 21 186 36 320 3 133 44 936 3 214 33 759 6 727 37 010

312 Electricity distribution and control apparatus 46 087 - 30 732 3 435 62 388 2 430 32 865 5 081 38 607

313 Insulated wire and cable 44 887 28 126 42 403 3 118 43 053 2 054 43 020 5 838 37 510

314 Accumulators, primary cells, and primary 

batteries

42 015 13 072 29 501 3 090 51 851 2 320 48 597 6 686 39 297

315 Electric lamps and lighting 40 876 18 427 26 292 2 567 45 296 1 512 36 820 3 742 37 524

319 Other electrical equipment 48 021 - 31 073 3 016 51 849 2 059 34 669 5 356 40 521

321 Electronic valves and tubes and other 

components

55 543 26 475 33 892 3 565 55 980 3 099 45 244 5 505 43 609

322 Television and radio transmitters and apparatus 

for line telephony and line telegraphy

67 472 16 401 38 514 5 642 61 505 3 073 48 407 3 551 59 603

323

Television and radio receivers, sound or video 

recording or reproducing apparatus, and 

associated goods

46 191 - 31 765 3 931 53 013 2 918 39 034 6 655 39 793

341 Motor vehicles 58 581 16 823 51 412 4 903 74 085 5 132 67 092 11 669 54 979

342 Motor vehicle bodies, trailers, and semi-trailers 36 128 17 122 26 187 4 461 38 978 1 391 57 883 4 729 35 933

343 Motor vehicle parts, accessories, and engines 50 106 18 596 34 735 3 013 56 674 2 318 43 575 5 463 43 468

351 Building and repairing of ships and boats 42 304 25 202 26 690 4 629 48 154 2 645 37 076 4 764 42 845

352 Railway and tramway locomotives and rolling 

stock

47 708 22 369 34 042 3 706 52 651 1 942 39 345 7 066 65 370

353 Aircraft and spacecraft 69 177 59 865 41 670 4 455 74 180 7 349 53 046 6 402 59 247

359 Transport equipment 48 259 - 31 042 2 580 38 689 2 429 27 510 5 057 28 202

15-37 Total Manufacturing 47 204 - 30 824 2 899 47 720 1 781 30 486 4 847 41 929
22

Table 3.2: Detailed Manufacturing Value Added Industry Comparisons, 2006 (UNIDO Statistical 

Country Briefs)

Note: The green bars represent a visual comparison between countries for each category (listed in the far 

left column) and subsector (listed in the top row) combination. For example, the U.S. has the largest value 

added for ISIC 15-22; therefore, it also has the longest green bar within the value added category for the 

ISIC 15-22 subsector. 

Food, apparel, wood product, and printing manufacturingRefined petroleum products and nuclear fuel Chemicals Rubber and plastics Other nonmetallic mineral products Basic metals Fabricated metals Machinery and equipmentOffice, accounting and computing machineryElectrical machinery and apparatus, n.e.c.Radio, television and communication equipmentMedical, precision and optical instruments Transport equipmentOther manufacturing TOTAL

ISIC 15-22 23 24 25 26 27 28 29 30 31 32 33 34-35 36-37

United States - - 351 100 80 86 154 181 36 70 110 135 243 - 2 306

Australia - - - 3 5 8 8 3 0 - - - 6 - 80

Canada - - 14 7 5 9 11 10 2 4 3 - 28 - 156

China - - 140 39 65 185 59 109 29 62 87 17 92 28 1 295

Germany 97 7 35 27 17 27 54 89 5 42 14 25 99 15 576

India 17 - 13 2 4 12 2 5 1 3 1 1 9 1 81

Japan - 7 101 51 33 63 64 116 15 38 85 24 133 - 939

Mexico 29 - 13 4 6 - 3 4 1 6 3 - 11 - 88

UK - - 23 14 8 6 22 22 2 9 5 11 31 12 262

United States - - 15.2% 4.3% 3.5% 3.8% 6.7% 7.9% 1.6% 3.0% 4.8% 5.9% 10.5% - 100.0%

Australia - - - 3.4% 6.1% 10.2% 9.6% 4.0% 0.2% - - - 7.6% - 100.0%

Canada - - 9.0% 4.7% 3.2% 5.9% 6.9% 6.4% 1.0% 2.6% 2.2% - 17.8% - 100.0%

China - - 10.8% 3.0% 5.0% 14.3% 4.6% 8.4% 2.2% 4.8% 6.7% 1.3% 7.1% 2.2% 100.0%

Germany 16.8% 1.2% 6.1% 4.7% 3.0% 4.7% 9.4% 15.4% 0.8% 7.4% 2.4% 4.4% 17.1% 2.6% 100.0%

India 21.4% - 16.1% 2.5% 4.4% 14.3% 2.8% 5.6% 0.8% 3.8% 1.7% 0.9% 10.5% 1.3% 100.0%

Japan - 0.8% 10.7% 5.5% 3.5% 6.7% 6.8% 12.4% 1.6% 4.0% 9.0% 2.5% 14.2% - 100.0%

Mexico 32.8% - 14.5% 4.1% 6.6% - 3.6% 4.7% 1.0% 6.8% 3.5% - 12.4% - 100.0%

UK - - 8.7% 5.3% 3.2% 2.2% 8.2% 8.3% 0.9% 3.4% 1.8% 4.2% 11.7% 4.4% 100.0%

United States - 1 298 383 62 - 141 - - 101 679 196 553 910 - 12 549

Australia - - - 7 24 - 5 - 6 - 8 - - - -

Canada - 133 63 19 74 83 - - 11 128 24 60 - - 1 947

China - 3 936 3 175 1 580 5 531 2 224 801 - 817 8 238 1 612 4 412 4 300 1 281 72 304

Germany 3 286 783 109 23 52 42 19 316 58 641 64 203 924 249 6 934

India 5 040 289 398 648 542 127 85 - 55 719 87 120 430 38 8 804

Japan - 675 183 66 129 77 22 406 49 575 78 426 1 060 - 7 549

Mexico - - 181 52 408 113 42 - 38 210 41 385 330 - 4 314

UK - 230 87 - 39 20 - - 32 170 29 82 236 227 3 138

United States - - 917 1 607 - 612 - - 360 103 562 244 267 - 184

Australia - - - 379 205 - 1 568 - 24 - - - - - -

Canada - - 223 389 67 112 - - 149 31 139 - - - 80

China - - 44 25 12 83 74 - 35 8 54 4 21 22 18

Germany 29 9 322 1 168 335 649 2 786 280 80 66 212 124 107 61 83

India 3 - 33 3 7 91 27 - 12 4 16 6 20 28 9

Japan - 11 550 782 255 817 2 907 286 311 66 1 088 56 125 - 124

Mexico - - 70 70 14 - 75 - 22 28 74 - 33 - 20

UK - - 264 - 216 301 - - 75 52 159 135 130 51 83

United States - - 1 177 333 269 290 517 607 122 234 369 452 812 - 7 722

Australia - - - 130 237 396 374 157 8 - - - 296 - 3 891

Canada - - 431 226 154 284 329 304 49 122 104 - 851 - 4 785

China - - 107 30 50 142 45 84 22 48 67 13 70 22 993

Germany 1 177 87 424 327 212 330 659 1 075 56 515 165 307 1 199 183 6 999

India 16 - 12 2 3 10 2 4 1 3 1 1 8 1 73

Japan - 58 789 403 257 492 503 911 119 296 665 186 1 041 - 7 353

Mexico 269 - 119 34 54 - 29 39 8 55 28 - 101 - 820

UK - - 376 229 139 97 353 359 39 146 77 182 504 190 4 306

Value Added ($billion 

2006) Percent of Total Value Added Employment (thousands) Value Added per Employee ($thousands 2006) Value Added per Capita ($2006)
23

3.2 Organization for Economic Cooperation and Development

The Organization for Economic Cooperation and Development contains 34 member 

countries and was founded in 1961 in order to advance the economic and social wellbeing of people from across the globe. The OECD assembles and disseminates data 

characterizing its member countries along with non-member countries. A selection of 

OECD data is described below.

3.2.1 Production

Organization for Economic Co-operation and Development’s (OECD) Structural 

Analysis (STAN) Data: The OECD StatExtracts provides various economic data, 

including value added by industry for OECD member countries. The STAN database 

provides detailed industrial data across a number of countries. It includes annual 

measures of output, labor input, investment, and international trade. Similar to data from 

the United Nations, some observations are estimates and are not official member country 

submissions and data is organized based on the International Standard Industrial 

Classification, Revision 3 (ISIC Rev. 3).42 National currencies are converted to dollars 

using the OECD purchasing power parity (PPP) rates for gross domestic product. This 

conversion eliminates the differences in price levels between countries; thus, in effect the 

resulting values reflect only differences in the volume of goods and services purchased. 

Table 3.3 below presents STAN data for 9 countries; these are the same countries 

presented in Table 3.2. They represent major U.S. trading partners, countries that are 

often considered competitors with the U.S., and nations that are similar to the U.S. 

Unfortunately, STAN data is unavailable for three of the nations shown. Among the 

OECD countries for which data is shown in Table 3.3, the U.S. has the largest value 

added for all the manufacturing categories except basic metal and other manufacturing, 

which emphasizes the importance of U.S. manufacturing for the global economy. With 

the exception of ISIC 15-22, the percent of total value added in the U.S. for each 

manufacturing category is within 9 percentage points of the other nations. This shows 

some consistency which suggests that the sectors of U.S. manufacturing are not all that 

different from the other countries listed. That is, the proportion of manufacturing that 

each sector represents is similar to proportions in the other nations. Among the nations 

listed in Table 3.3, the U.S. has the largest value added per capita for refined petroleum 

products and nuclear fuel manufacturing along with office, accounting, and computing 

machinery manufacturing. Figure 3.5 provides a graph for three of the manufacturing 

subsectors: office, accounting, and computing machinery (ISIC 30); transportation 

equipment plus machinery and equipment (ISIC 29, 34-35); and chemicals (ISIC24). The 

U.S. has the largest value added for each sector shown for nearly the whole time period 

with the exception of 1991 where Japan exceeded the U.S. for office, accounting and 

computing machinery. In terms of value added per capita, the U.S. does not maintain the 

largest position. 

 

42 OECD. “StatExtracts.” <http://stats.oecd.org/Index.aspx>
24

Chemical manufacturing has been a large component of U.S. manufacturing as seen in 

Figure 3.6 and has grown significantly between 1985 and 2008. The largest component of 

total manufacturing is food, apparel, wood product, and printing manufacturing (ISIC 15-

22), which is not shown in the figure. Refined petroleum products and nuclear fuel 

increased 42 % between 2000 and 2009. This increase is likely due in part to pressure to 

increase domestic oil production, technological advances in oil extraction using hydraulic 

fracturing, and increases in price. 

Table 3.3: OECD Value Added, 2006

Note: The green bars represent a visual comparison between countries for each category (listed in the far 

left column) and subsector (listed in the top row) combination. For example, the U.S. has the largest value 

added for ISIC 15-22; therefore, it also has the longest green bar within the value added category for the 

ISIC 15-22 subsector.

Food, apparel, wood product, and printing manufacturingRefined petroleum products and nuclear fuel Chemicals Other nonmetallic mineral productsRubber and plastics Basic metals Fabricated metals Machinery and equipmentOffice, accounting and computing machineryElectrical machinery and apparatus, n.e.c. Radio, television and communication equipmentMedical, precision and optical instruments Transport equipmentOther manufacturing TOTAL

ISIC 15-22 23 24 26 25 27 28 29 30 31 32 33 34-35 36-37

USA 479.4 140.0 207.9 65.1 45.4 59.7 125.6 116.6 30.4 45.6 101.2 68.3 189.1 - 1 785.4

Australia - - - - - - - - - - - - - - 76.3

Canada 61.0 3.9 12.0 8.1 5.3 12.4 12.5 11.8 0.6 2.5 5.2 - 19.9 - 163.9

China - - - - - - - - - - - - - - -

Germany 102.0 7.0 59.0 27.3 17.5 26.2 55.0 89.0 4.4 43.2 14.6 26.3 98.0 15.2 584.7

India - - - - - - - - - - - - - - -

Japan 83.6 52.9 63.3 36.3 27.1 72.9 39.3 101.7 10.9 37.2 86.5 14.7 119.5 - 864.8

Mexico 94.4 14.5 25.1 7.1 15.5 23.3 8.5 11.1 3.9 11.4 6.7 1.8 34.4 7.7 265.3

United Kingdom 78.8 3.6 29.6 11.3 8.6 5.0 21.1 20.7 4.7 7.8 5.2 9.3 26.4 - 242.5

USA 26.9% 7.8% 11.6% 3.6% 2.5% 3.3% 7.0% 6.5% 1.7% 2.6% 5.7% 3.8% 10.6% - 100.0%

Australia - - - - - - - - - - - - - - 100.0%

Canada 37.2% 2.4% 7.3% 4.9% 3.2% 7.6% 7.7% 7.2% 0.4% 1.6% 3.2% - 12.1% - 100.0%

China - - - - - - - - - - - - - - -

Germany 17.4% 1.2% 10.1% 4.7% 3.0% 4.5% 9.4% 15.2% 0.8% 7.4% 2.5% 4.5% 16.8% 2.6% 100.0%

India - - - - - - - - - - - - - - -

Japan 9.7% 6.1% 7.3% 4.2% 3.1% 8.4% 4.5% 11.8% 1.3% 4.3% 10.0% 1.7% 13.8% - 100.0%

Mexico 35.6% 5.5% 9.4% 2.7% 5.8% 8.8% 3.2% 4.2% 1.5% 4.3% 2.5% 0.7% 13.0% 2.9% 100.0%

United Kingdom 32.5% 1.5% 12.2% 4.7% 3.5% 2.1% 8.7% 8.5% 1.9% 3.2% 2.1% 3.8% 10.9% - 100.0%

USA 1 606 469 696 218 152 200 420 390 102 153 339 229 633 - 5 979

Australia - - - - - - - - - - - - - - -

Canada 1 868 120 366 248 163 379 384 360 19 78 161 - 608 - 5 017

China - - - - - - - - - - - - - - -

Germany 1 238 85 717 331 212 318 667 1 081 54 525 177 320 1 190 185 7 100

India - - - - - - - - - - - - - - -

Japan 655 414 495 284 212 571 307 797 85 291 677 115 936 - 6 770

Mexico 878 135 233 66 144 217 79 103 36 106 63 17 320 72 2 469

United Kingdom 1 295 59 486 186 141 83 347 340 76 129 85 152 433 - 3 986

Value Added ($billion 

2006)

Value Added per Capita 

($2006) Percent of Total Value Added
25

Figure 3.5: Selected Manufacturing Subsectors: Value Added and Value Added per Capita

0

5

10

15

20

25

30

35

1985198719891991199319951997199920012003200520072009

$Billions 2009

Office, Accounting, and Computing 

Machinery: Value Added (ISIC 30)

Canada

Germany

Japan

Mexico

United Kingdom

USA

0

20

40

60

80

100

120

140

160

198519881991199419972000200320062009

$ per capita 2009

Office, Accounting, and Computing 

Machinery: Value Added per Capita 

(ISIC 30)

0

50

100

150

200

250

300

350

1984198619881990199219941996199820002002200420062008

$Billions 2009

Transportation and Machinery: Value 

Added (ISIC 29, 34-35)

0

500

1000

1500

2000

2500

3000

198419871990199319961999200220052008

$ per capita 2009

Transportation and Machinery: Value 

Added per Capita (ISIC 29, 34-35)

0

50

100

150

200

250

300

1985198719891991199319951997199920012003200520072009

$Billions 2009

Chemical and Chemical Products: Value 

Added (ISIC 24)

0

100

200

300

400

500

600

700

800

900

1000

198519881991199419972000200320062009

$ per capita

Chemical and Chemical Products: Value 

Added per Capita (ISIC 24)
26

Among all OECD countries for which data is available in 2009, the U.S. ranks above the 

70th percentile in value added per capita for the following manufacturing sectors (see 

Table 3.4): food, apparel, wood product, and printing; refined petroleum products and 

nuclear fuel; chemicals; office, accounting, and computing machinery; radio, television 

and communication equipment; medical, precision, and optical instruments; transport 

equipment; and other manufacturing. The remaining sectors in manufacturing are below 

the 50th percentile: other nonmetallic mineral products; rubber and plastics; basic metals; 

fabricated metals; machinery and equipment; and electrical machinery and apparatus. 

Between 2000 and 2009, some sectors had significant changes in their ranking while 

others remained relatively stable. It is important to note, in Table 3.4, that the number of 

countries for which data is available changes from year to year, which affects the 

percentile calculations.

Some U.S. sectors of manufacturing may rank high among OECD countries in terms of 

value added per capita; however, they may not rank high in terms of their return on 

investment in capital and labor. Earning a profit is a primary motivator for establishing a 

business. If a sector of U.S. manufacturing has a low return on investment, a company 

may decide to establish its production elsewhere. Table 3.5 uses the gross operating

Figure 3.6: U.S. Manufacturing Value Added (excluding ISIC 15-22, 36, and 37) by Subsector 

(OECD Structural Analysis Database)

Note: Data for this figure was adjusted using the PPI for all manufacturing and the PPI for NAICS 324, 

325, 326, 327, 331, 332, 3332, 3342, and 336991. 

0

50

100

150

200

250

1985

1988

1991

1994

1997

2000

2003

2006

2009

Value Added ($billions 2009)

Office, accounting and computing

machinery

Other nonmetallic mineral

products

Electrical machinery and

apparatus, n.e.c.

Medical, precision and optical

instruments

Basic metals

Rubber and plastics

Radio, television and

communication equipment

Refined petroleum products and

nuclear fuel

Machinery and equipment

Fabricated metals

Transport equipment

Chemicals
27

surplus per expenditure dollar to proxy as a return on investment in a particular sector of 

manufacturing. Gross operating surplus is gross output less a subset of costs (i.e., 

intermediate expenditures, compensation, and taxes less subsidies) and does not take into 

account the depreciation of capital; therefore, it does not fully represent a return on 

investment. The OECD data does not contain U.S. values for depreciation. Expenditures 

is the sum of intermediate expenditures, compensation, and taxes less subsidies. As seen 

in the table, the U.S. is above the 70th percentile for four sectors of manufacturing in 2009

and total manufacturing; however, data for 2009 is available from only a few countries.

Unfortunately, data was not available for four of the sectors. Although there is some 

fluctuation in the rankings between 2001 and 2009 a number of the sectors never rise 

above the 70th percentile: food, apparel, wood product, and printing; other nonmetallic 

mineral products; basic metals; and fabricated metals.

Productivity in the U.S. is considered to be quite high and this is reflected in Table 3.6, 

which shows the U.S. rank of the ratio of value added to the number of hours worked in 

manufacturing among OECD countries; unfortunately, a number of sectors do not have 

data available. In this table, total manufacturing in the U.S. is ranked above the 90th

percentile in 2009 and has consistently ranked above the 80th percentile in other years. 

Additionally, four of the six sectors for which there is data are ranked above the 80th

percentile in 2009: food, apparel, wood product, and printing; refined petroleum products 

and nuclear fuel; chemicals; and machinery and equipment. U.S. wages consistently rank 

above the 70

th percentile and often above the 90th percentile as seen in Table 3.7. In 2009, 

the highest rankings were in chemicals, other nonmetallic mineral products, fabricated 

metals, and machinery and equipment.

Table 3.4: U.S. Value Added per Capita by Year, Percentile (OECD Structural Analysis Database)

Food, apparel, wood product, and printing manufacturingRefined petroleum products and nuclear fuel Chemicals Other nonmetallic mineral productsRubber and plastics Basic metals Fabricated metals Machinery and equipmentOffice, accounting and computing machineryElectrical machinery and apparatus, n.e.c. Radio, television and communication equipmentMedical, precision and optical instrumentsTransport equipmentOther manufacturing

ISIC 15-22 23 24 26 25 27 28 29 30 31 32 33 34-35 36-37

2001 80.6 92.3 72.4 76.7 29.0 41.9 64.5 56.7 86.2 40.0 80.0 62.1 80.6 93.5

2002 80.6 88.5 75.9 70.0 29.0 45.2 54.8 50.0 86.2 46.7 80.0 62.1 80.6 93.5

2003 80.6 92.3 69.0 66.7 25.8 41.9 51.6 43.3 86.2 43.3 80.0 69.0 80.6 93.5

2004 80.6 92.3 69.0 66.7 22.6 45.2 61.3 50.0 90.0 36.7 76.7 72.4 77.4 93.5

2005 80.6 96.2 69.0 66.7 19.4 45.2 58.1 46.7 89.7 40.0 80.0 72.4 74.2 93.5

2006 70.0 96.0 67.9 55.2 13.3 43.3 56.7 44.8 92.9 37.9 75.9 71.4 73.3 93.3

2007 74.1 95.7 65.4 55.6 3.7 37.0 48.1 40.7 88.5 25.9 77.8 70.4 70.4 92.6

2008 72.0 90.5 58.3 40.0 0.0 33.3 33.3 36.0 95.5 27.3 81.8 73.9 56.0 84.0

2009 72.7 88.9 71.4 45.5 0.0 31.6 36.8 36.4 93.8 33.3 80.0 88.9 72.7 81.8

2001 31 26 29 30 31 31 31 30 29 30 30 29 31 31

2002 31 26 29 30 31 31 31 30 29 30 30 29 31 31

2003 31 26 29 30 31 31 31 30 29 30 30 29 31 31

2004 31 26 29 30 31 31 31 30 30 30 30 29 31 31

2005 31 26 29 30 31 31 31 30 29 30 30 29 31 31

2006 30 25 28 29 30 30 30 29 28 29 29 28 30 30

2007 27 23 26 27 27 27 27 27 26 27 27 27 27 27

2008 25 21 24 25 25 24 24 25 22 22 22 23 25 25

2009 22 18 21 22 22 19 19 22 16 15 15 18 22 22 Number of Countries Ranked U.S. Percentile
28

Table 3.5: U.S. Rank of Gross Operating Surplus per Dollar of Expenditure (OECD Structural 

Analysis Database)

Table 3.6: U.S. Rank of the Ratio of Value Added to Hours of Work (OECD Structural Analysis 

Database)

Food, apparel, wood product, and printing manufacturingRefined petroleum products and nuclear fuel Chemicals Rubber and plastics Other nonmetallic mineral products Basic metals Fabricated metals Machinery and equipmentOffice, accounting and computing machineryElectrical machinery and apparatus, n.e.c.Radio, television and communication equipmentMedical, precision and optical instruments Transport equipmentOther manufacturing TOTAL

ISIC 15-22 23 24 25 26 27 28 29 30 31 32 33 34-35 36-37

2001 3.6 95.7 65.4 70.4 32.1 15.4 53.8 55.6 - 91.3 - - 56.0 - 48.3

2002 7.1 82.6 73.1 51.9 50.0 38.5 42.3 29.6 - 91.3 - - 76.0 - 72.4

2003 7.1 95.7 65.4 51.9 35.7 23.1 46.2 22.2 - 87.5 - - 20.0 - 65.5

2004 14.3 91.3 73.1 63.0 35.7 57.7 61.5 44.4 - 54.2 - - 48.0 - 79.3

2005 17.9 95.7 53.8 55.6 35.7 46.2 61.5 55.6 - 41.7 - - 60.0 - 82.8

2006 7.4 86.4 72.0 46.2 14.8 48.0 52.0 61.5 - 82.6 - - 58.3 - 79.3

2007 12.0 90.5 79.2 68.0 8.0 25.0 62.5 60.0 - 72.7 - - 43.5 - 77.8

2008 9.5 83.3 45.0 40.0 9.5 40.0 45.0 61.9 - 64.7 - - 27.8 - 78.3

2009 52.6 81.3 83.3 44.4 57.9 43.8 62.5 73.7 - 85.7 - - 28.6 - 78.9

2001 28 23 26 27 28 26 26 27 - 23 - - 25 - 29

2002 28 23 26 27 28 26 26 27 - 23 - - 25 - 29

2003 28 23 26 27 28 26 26 27 - 24 - - 25 - 29

2004 28 23 26 27 28 26 26 27 - 24 - - 25 - 29

2005 28 23 26 27 28 26 26 27 - 24 - - 25 - 29

2006 27 22 25 26 27 25 25 26 - 23 - - 24 - 29

2007 25 21 24 25 25 24 24 25 - 22 - - 23 - 27

2008 21 18 20 20 21 20 20 21 - 17 - - 18 - 23

2009 19 16 18 18 19 16 16 19 - 14 - - 14 - 19 U.S. Percentile Number of Countries Ranked Food, apparel, wood product, and printing manufacturing Refined petroleum products and nuclear fuel Chemicals Rubber and plastics Other nonmetallic mineral products Basic metals Fabricated metals Machinery and equipment Office, accounting and computing machinery Electrical machinery and apparatus, n.e.c. Radio, television and communication equipment Medical, precision and optical instruments Transport equipment Other manufacturing TOTAL

ISIC 15-22 23 24 25 26 27 28 29 30 31 32 33 34-35 36-37

2001 87.5 73.3 92.9 69.2 50.0 - - 86.7 - - - - - - 85.0

2002 88.2 75.0 93.3 78.6 64.7 - - 81.3 - - - - - - 90.0

2003 88.2 81.3 93.3 78.6 52.9 - - 81.3 - - - - - - 90.0

2004 88.2 87.5 93.3 71.4 58.8 - - 81.3 - - - - - - 90.0

2005 88.2 87.5 86.7 78.6 64.7 - - 81.3 - - - - - - 95.0

2006 82.4 87.5 93.3 57.1 35.3 - - 68.8 - - - - - - 95.0

2007 87.5 86.7 92.9 61.5 25.0 - - 66.7 - - - - - - 94.7

2008 86.7 85.7 92.9 38.5 26.7 - - 73.3 - - - - - - 94.4

2009 91.7 83.3 91.7 63.6 58.3 - - 91.7 - - - - - - 93.3

2001 16 15 14 13 16 - - 15 - - - - - - 20

2002 17 16 15 14 17 - - 16 - - - - - - 20

2003 17 16 15 14 17 - - 16 - - - - - - 20

2004 17 16 15 14 17 - - 16 - - - - - - 20

2005 17 16 15 14 17 - - 16 - - - - - - 20

2006 17 16 15 14 17 - - 16 - - - - - - 20

2007 16 15 14 13 16 - - 15 - - - - - - 19

2008 15 14 14 13 15 - - 15 - - - - - - 18

2009 12 12 12 11 12 - - 12 - - - - - - 15 U.S. Percentile Number of Countries Ranked
29

Table 3.7: Wages by Year, Percentile (OECD Structural Analysis Database)

As previously discussed, manufacturing as a percent of GDP decreased for many 

countries and the aggregate of all countries (see Figure 3.4). During the same 1970 to 

2008 period, manufacturing share of employment has decreased for many countries as 

seen in Figure 3.7, which shows all OECD countries for which data is available. 

Meanwhile production for many of these countries has remained relatively constant or 

increased during the 1984 to 2008 period (see Figure 3.3). Since employment is declining 

and output is remaining relatively constant or increasing, then, manufacturing labor

productivity is increasing faster than the growth in demand for domestically produced 

manufactured products. Additionally, since manufacturing as a percent of GDP has 

decreased, then, the economy is growing faster than the demand for domestically 

manufactured products. 

There is some discussion as to whether productivity increases directly explain declines in 

manufacturing employment in the U.S. According to Schweitzer and Zaman as well as 

Nordhaus, productivity increases do not explain the decreases in manufacturing 

employment.43, 44 However, Ward claims that 80 % of the job losses in the U.S. economy 

since 1990 are due to productivity increases;45 other authors also assert that increased 

productivity is the major reason for the decreased manufacturing employment 

 

43 Schweitzer, Mark and Saeed Zaman. “Are we Engineering Ourselves out of Manufacturing Jobs.” 

Federal Reserve Bank of Cleveland. January 2006. 

<http://www.clevelandfed.org/research/commentary/2006/0101.pdf>

44 Nordhaus, William. “The Sources of the Productivity Rebound and the Manufacturing Employment 

Puzzle.” NBER Working Paper. May 2005. <http://www.nber.org/papers/w11354>

45 Ward, William A. “Manufacturing Productivity and the Shifting US, China, and Global Job Scenes—

1990 to 2005.” Clemson University Center for International Trade Working Paper 052507. August 2005. 

<http://ageconsearch.umn.edu/bitstream/112948/2/citpaper12.pdf>

Food, apparel, wood product, and printing manufacturingRefined petroleum products and nuclear fuel Chemicals Rubber and plastics Other nonmetallic mineral products Basic metals Fabricated metals Machinery and equipmentOffice, accounting and computing machineryElectrical machinery and apparatus, n.e.c.Radio, television and communication equipmentMedical, precision and optical instruments Transport equipmentOther manufacturing TOTAL

Year 15-22 23.0 24.0 25.0 26.0 27.0 28.0 29.0 30.0 31.0 32.0 33.0 34-35 36-37

2001 86.4 84.2 95.2 86.4 90.9 88.9 94.4 95.5 94.4 94.1 94.1 94.4 94.4 - 95.5

2002 86.4 84.2 95.2 86.4 95.5 89.5 94.7 95.5 94.4 94.1 94.1 94.4 94.4 - 95.5

2003 86.4 84.2 95.2 86.4 95.5 94.7 94.7 95.5 94.4 94.1 94.1 94.4 94.4 - 95.5

2004 86.4 84.2 95.2 86.4 95.5 89.5 94.7 95.5 88.9 88.2 94.1 94.4 94.4 - 95.5

2005 85.7 83.3 95.0 85.7 95.2 89.5 94.7 95.2 94.4 88.2 94.1 94.4 94.4 - 95.5

2006 90.5 88.9 95.0 81.0 90.5 89.5 89.5 95.2 94.4 88.2 94.1 94.4 94.4 - 95.5

2007 90.0 88.2 94.7 80.0 95.0 88.9 88.9 95.0 94.1 87.5 93.8 94.1 94.1 - 95.2

2008 86.7 84.6 93.3 86.7 87.5 84.6 92.3 93.3 91.7 81.8 90.9 91.7 91.7 - 94.1

2009 76.9 81.8 92.3 84.6 92.9 80.0 90.0 92.3 88.9 87.5 87.5 88.9 88.9 - 93.8

2001 22 19 21 22 22 18 18 22 18 17 17 18 18 - 22

2002 22 19 21 22 22 19 19 22 18 17 17 18 18 - 22

2003 22 19 21 22 22 19 19 22 18 17 17 18 18 - 22

2004 22 19 21 22 22 19 19 22 18 17 17 18 18 - 22

2005 21 18 20 21 21 19 19 21 18 17 17 18 18 - 22

2006 21 18 20 21 21 19 19 21 18 17 17 18 18 - 22

2007 20 17 19 20 20 18 18 20 17 16 16 17 17 - 21

2008 15 13 15 15 16 13 13 15 12 11 11 12 12 - 17

2009 13 11 13 13 14 10 10 13 9 8 8 9 9 - 16 U.S. Percentile Number of Countries Ranked
30

Figure 3.7: Manufacturing Share of Employment (OECD SDBS Business Demography Database)

* The 1970 value for the United Kingdom was estimated using a rolling 10 year average change

numbers.46, 47, 48 These contrasting views need to be reconciled before any solid 

conclusions can be drawn concerning the decrease in manufacturing employment.

In addition to employment and production data, OECD also maintains data on the number 

of businesses started and ending during the year. As seen in Table 3.8, the 2005 U.S. 

employer enterprise birth rate (number of new enterprises divided by the number of 

existing enterprises) is less than the death rate; thus, more businesses were eliminated 

from manufacturing than were created. Seemingly, this trend has left the U.S. 

manufacturing industry with one of the lowest numbers of active employer enterprises 

per capita and also having a share of total employment lower than Germany, Italy, Japan, 

France, Canada, and the United Kingdom (not shown). 

 

46 Kelley, Charles, Mark Wang, Gordon Bitko, Michael Chase, Aaron Kofner, Julia Lowell, James 

Mulvenon, David Ortiz, and Kevin Pollpeter. March 2004. “High-Technology Manufacturing and U.S. 

Competitiveness.” RAND Technical Report. 

<http://www.rand.org/pubs/technical_reports/2004/RAND_TR136.pdf>

47 Krugman, Paul R. and Robert Z. Lawrence. “Trade, Jobs, and Wages,” Scientific American, April 1994: 

22-27. 

48 Rowthorn, Robert and Ramana Ramaswamy. “Deindustrialization: Causes and Implications,” April 

1997. International Monetary Fund Working Paper WP/97/42.

0

5

10

15

20

25

30

35

40

Percent

United States

United Kingdom*

Netherlands

Norway

Canada

France

Ireland

Belgium

Denmark

Sweden

Japan

Finland

Korea

Germany

Italy
31

Table 3.8: Employer Enterprises in Manufacturing (OECD SDBS Business Demography Database)

3.2.2 Input-Output Data

OECD STAN Input-Output Data: The STAN input-output data49 is collected and 

assembled in a different manner than the STAN data previously discussed; however, the 

input-output data has within it estimates of value added for various manufacturing 

subsectors. This data contains estimates for China, Australia, and India whereas 

previously discussed STAN data did not have them. Input-Output tables describe the 

sales and purchases of final and intermediate goods and services within an economy. 

 

49 The STAN input-output data and other input-output data presented in this report are based on a 

framework developed by Wassily Leontief. Leontief was awarded the Nobel Memorial Prize in Economic 

Sciences in 1973 for his pioneering work on input-output analysis.

Australia - - - 56 883 2.81 10.65

Austria 4.74 5.62 79.85 *** 22 602 2.76 16.08

Belgium 1.67 ** 1.59 ** - 20 903 ** 2.01 ** 14.24

Brazil 9 6.73 - 241 370 1.30 -

Bulgaria 8.36 4.49 61.90 21 327 2.86 -

Canada 7.32 7.24 73.88 58 580 1.81 12.97

Czech Republic 8.49 - - 37 850 3.70 27.46

Denmark 6.45 9.28 - 11 549 2.13 14.14

Estonia 8.31 7.16 77.96 5 057 3.79 22.97

Finland 6.54 6.8 68.77 14 424 2.76 18.11

Hungary 7.55 8.97 61.93 39 423 3.92 22.35

Israel 6.3 4.74 68.53 *** 16 447 2.44 13.15

Italy 5.71 7.08 72.28 297 531 5.04 20.45

Latvia 7.77 3.8 77.65 *** 5 815 2.54 -

Lithuania 8.82 - - 8 054 2.24 -

Luxembourg 6.62 4.5 85.29 755 1.61 11.53

Netherlands 6.2 7.12 47.62 29 898 1.83 11.25

New Zealand - - 65.53 - - 14.92

Norway 4.39 2.96 - 11 030 2.40 11.22

Portugal 12.05 13.79 49.91 *** 99 113 9.38 18.38

Romania 12.42 8.2 75.03 51 108 2.30 -

Slovak Republic 9.93 7.13 74.96 23 237 4.28 24.46

Slovenia 5.68 5.54 80.54 *** 10 487 5.21 26.05

Spain 6.21 6.42 76.38 170 923 3.91 16.12

Sweden 5.61 ** - - 26 211 ** 2.91 ** 16.46

United States 7.28 8.32 83.89 352 181 1.19 10.35

* This value is for 2005

** This value is for 2006

*** This value is for 2007

Employer 

Enterprise 

Birth Rate 

(2005)

Employer 

Enterprise 

Death Rate 

(2005)

2-Year 

Survival 

Rate (2006)

Number of 

Active 

Employer 

Enterprises 

(2005)

Number of 

Active 

Employer 

Enterprises Per 

Capita (2005) 

(thousands)

Employment 

Shares in 

Total Economy 

(percent) 

(2005)
32

Data in the STAN tables are categorized by industry and are available for the mid-2000’s, 

early 2000’s, and the mid-1990’s. The mid-2000’s data are available for 39 countries 

representing over 90 % of global GDP while the mid-1990’s data is available for 36 

countries representing over 70 % of global GDP.50 These data have been converted to 

U.S. dollars using the OECD National Accounts Exchange rates. 

The input-output data from the STAN database provide an estimate of value added for 

each two digit ISIC code in manufacturing. Table 3.9 provides the mid-2000’s value as 

well as gross operating surplus per dollar of expenditure. Out of all 39 countries, the U.S. 

has the largest value added in the mid-2000’s for all manufacturing subsectors except 

ISIC 27, 30, and 31 as seen in the rankings. According to the table, U.S. manufacturing 

value added is 13.1 % of GDP while China is 34.2 %. In terms of value added per capita, 

the U.S. ranks 4th in office, accounting, and computing machinery and 11th for all 

manufacturing. The U.S. does not rank first for any subsector in terms of value added per 

capita. Gross operating surplus per dollar of expenditure, as seen in Table 3.9, proxies as 

a measure of the return on investment as gross operating surplus is similar to profit 

except it does not take into account the depreciation of capital. Expenditures include 

compensation of employees, taxes, and intermediate goods and services. The gross 

operating surplus per dollar of expenditure is 0.15 for the whole of U.S. manufacturing. 

Among the countries shown, India and Mexico have larger ratios at 0.19 and 0.27. The 

largest ratio among the U.S. subsectors is 0.26 for ISIC 26, which includes the production 

of glass, ceramics, and other non-metallic mineral products. Table 3.10 breaks value 

added into three components: compensation, gross operating surplus, and taxes. The sum 

of these three items is equal to value added. Approximately 58.1 % of U.S. 

manufacturing value added goes to the compensation of employees, 38.7 % is gross 

operating surplus, and 3.1 % is taxes. Only 31.2 % of China’s value added goes to the 

compensation of employees while 48.5 % is gross operating surplus and 20.3 % is taxes. 

Gross operating surplus being nearly 10 percentage points higher in China poses as a 

continued incentive for manufacturers to establish factories in China rather than in the 

U.S. In terms of gross operating surplus per dollar of expenditure, the U.S. ranks 14th for 

total manufacturing and 9th for office, accounting, and computing machinery (not shown).

 

50 Yamano, Norihiki and Nadim Ahmad. “The OECD Input-Output Database: 2006 Edition. 

DSTI/DOC(2006)8. October 2006. STI Working Paper 2006/8. 

<http://www.oecd.org/dataoecd/46/54/37585924.pdf>
33

Table 3.9: Value Added from the STAN Input-Output Data

Note: This data was adjusted using the PPI for all manufacturing for ISIC 15-22, 33, and 36-37; NAICS 

324 for ISIC 23; NAICS 325 for ISIC 24; NAICS 326 for ISIC 25; NAICS 327 for ISIC 26; NAICS 331 

for ISIC 27; NAICS 332 for ISIC 28; NAICS 3332 for ISIC 29; NAICS 3342 for ISIC 30; NAICS 3352 for

ISIC 31; NAICS 3342 for ISIC 32; and NAICS 336991 for ISIC 34-35. 

Note: The green and red bars represent a visual comparison between countries for each category (listed in 

the far left column) and subsector (listed in the top row) combination. Higher values have longer bars. Red 

bars signify instances where a lower value is preferred such as rankings (i.e., being 1st is preferred over 

31st).

Food, apparel, wood product, and printing manufacturingRefined petroleum products and nuclear fuel Chemicals Rubber and plastics Other nonmetallic mineral products Basic metals Fabricated metals Machinery and equipmentOffice, accounting and computing machineryElectrical machinery and apparatus, n.e.c. Radio, television and communication equipmentMedical, precision and optical instruments Transport equipmentOther manufacturing TOTAL

ISIC 15-22 23 24 25 26 27 28 29 30 31 32 33 34-35 36-37

United States 481 71 201 67 53 56 124 120 20 38 66 45 179 103 1 624

Australia 28 2 5 3 3 7 6 4 0 2 0 1 7 3 71

Canada 61 4 12 9 5 11 12 11 1 3 5 0 22 9 164

China 222 32 110 24 29 81 29 92 23 42 18 7 48 31 789

Germany 104 6 59 27 17 26 51 86 5 40 14 25 92 14 566

India 24 7 14 2 4 10 3 5 4 3 1 1 5 0 83

Japan 233 54 58 43 27 64 48 117 12 84 17 14 105 21 898

Mexico 48 4 12 3 8 7 4 3 7 4 0 0 19 4 123

UK 88 5 30 13 10 6 23 22 5 9 6 10 29 12 269

United States 0.15 0.14 0.24 0.15 0.26 0.13 0.16 0.13 0.19 0.22 0.16 0.05 0.06 0.19 0.15

Australia 0.16 0.09 0.15 0.13 0.15 0.14 0.12 0.10 - 0.10 - 0.10 0.10 0.11 0.14

Canada 0.17 0.05 0.15 0.15 0.24 0.14 0.14 0.16 0.01 0.10 0.09 - 0.08 0.19 0.13

China 0.13 0.10 0.13 0.11 0.26 0.12 0.12 0.13 0.08 0.11 0.10 0.13 0.10 0.38 0.13

Germany 0.13 0.05 0.16 0.14 0.12 0.11 0.13 0.11 0.10 0.06 0.13 0.19 0.05 0.11 0.11

India 0.18 0.18 0.26 0.15 0.33 0.20 0.36 0.19 0.22 0.13 0.08 0.27 0.11 - 0.19

Japan 0.18 0.03 0.15 0.12 0.21 0.10 0.15 0.15 0.12 0.14 0.11 0.13 0.07 0.11 0.12

Mexico 0.37 0.11 0.26 0.21 0.61 0.37 0.23 0.11 0.10 0.16 - - 0.25 0.25 0.27

UK 0.12 0.02 0.15 0.08 0.13 0.04 0.12 0.09 0.16 0.10 0.09 0.20 0.05 0.16 0.11

United States 3.87% 0.57% 1.62% 0.54% 0.43% 0.45% 1.00% 0.97% 0.16% 0.30% 0.53% 0.36% 1.44% 0.83% 13.07%

Australia 4.67% 0.26% 0.87% 0.43% 0.58% 1.19% 0.96% 0.66% 0.00% 0.41% 0.00% 0.15% 1.09% 0.44% 11.72%

Canada 5.76% 0.36% 1.14% 0.82% 0.47% 1.00% 1.15% 1.07% 0.05% 0.25% 0.52% 0.00% 2.08% 0.82% 15.50%

China 9.65% 1.40% 4.79% 1.05% 1.25% 3.52% 1.26% 4.00% 1.00% 1.81% 0.76% 0.31% 2.08% 1.34% 34.21%

Germany 4.15% 0.23% 2.34% 1.07% 0.67% 1.01% 2.02% 3.41% 0.19% 1.57% 0.57% 0.98% 3.66% 0.57% 22.46%

India 4.37% 1.20% 2.48% 0.38% 0.78% 1.72% 0.56% 0.89% 0.71% 0.63% 0.27% 0.11% 0.93% 0.00% 15.02%

Japan 5.15% 1.18% 1.27% 0.96% 0.59% 1.41% 1.06% 2.59% 0.27% 1.86% 0.37% 0.30% 2.32% 0.47% 19.81%

Mexico 7.16% 0.57% 1.86% 0.52% 1.19% 1.08% 0.56% 0.42% 1.04% 0.58% 0.00% 0.00% 2.83% 0.66% 18.46%

UK 4.35% 0.22% 1.50% 0.66% 0.47% 0.29% 1.16% 1.10% 0.26% 0.42% 0.28% 0.51% 1.45% 0.59% 13.26%

United States 1 1 1 1 1 3 1 1 2 4 1 1 1 1 1

Australia 14 21 19 16 14 13 13 19 34 15 36 19 14 17 17

Canada 8 17 15 9 12 7 10 10 17 14 11 36 8 8 9

China 3 3 2 4 2 1 5 3 1 2 4 7 4 2 3

Germany 4 11 3 3 5 4 2 4 6 3 6 2 3 5 4

India 16 8 11 19 13 10 20 16 7 13 19 23 16 39 14

Japan 2 2 4 2 3 2 3 2 3 1 5 3 2 3 2

Mexico 11 18 14 12 9 14 19 24 4 12 36 36 9 12 12

UK 5 13 5 6 8 16 7 7 5 8 10 4 6 6 6

United States 11 5 7 11 14 15 11 12 4 18 7 12 6 2 11

Australia 15 18 22 21 15 9 19 22 34 19 36 20 14 18 21

Canada 4 11 16 5 22 10 15 17 16 23 10 36 5 5 13

China 37 30 31 37 36 29 35 30 15 33 29 32 35 35 36

Germany 16 20 6 3 11 11 4 1 7 3 9 5 1 12 5

India 39 35 38 39 38 37 38 38 31 39 35 35 39 39 39

Japan 6 2 13 2 10 2 16 2 2 1 12 15 3 14 3

Mexico 29 29 27 32 29 27 33 36 5 32 36 36 22 32 30

UK 14 19 9 12 19 22 13 14 3 16 17 9 9 9 16 2005 Rank of Value Added per Capita (among 39 countries) 2005 Rank of Value Added (among 39 countries) Value Added as a Percent of Total GDP Gross Operating Surplus Per Dollar of Expenditure Value Added ($billion 2005)
34

Table 3.10: Compensation, Gross Operating Surplus, and Taxes as a Percent of Value Added, mid2000’s

Note: The green bars represent a visual comparison between countries for each category (listed in the far 

left column) and subsector (listed in the top row) combination. Higher values have longer bars.

In using OECD data in input-output analysis, economies of scale are ignored; thus, it 

operates under constant returns to scale. The model also assumes that a sector uses inputs 

in fixed proportions.51 Table 3.11 uses this model to estimate the output of the 

manufacturing industry and the domestically produced goods and services used to 

produce that output. The U.S. output for electronics was $335 billion with $115 billion of 

non-manufactured goods and services used domestically in their production. The total 

impact from electronics is $450 billion or 1.9 % of total output. The total impact from 

machinery is $1 511 billion or 6.5 % of total output. The whole of the U.S. manufacturing 

industry impacts $6 446 billion or 27.9 % of total output. This percentage is lower than in 

other countries such as China, Germany, India, and Japan which have impacts of 62.1 %, 

44.9 %, 45.3 %, and 41.2 % respectively. According to these data, the U.S. 

manufacturing industry uses 18.3 % of total U.S. research and development output (not 

shown).

 

51 Miller, Ronald E. and Peter D. Blair. Input-Output Analysis: Foundations and Extensions. (New York: 

Cambridge University Press, 2009): 16

Food, apparel, wood product, and printing manufacturingRefined petroleum products and nuclear fuel Chemicals Rubber and plastics Other nonmetallic mineral products Basic metals Fabricated metals Machinery and equipmentOffice, accounting and computing machineryElectrical machinery and apparatus, n.e.c.Radio, television and communication equipmentMedical, precision and optical instrumentsTransport equipmentOther manufacturing TOTAL

15-22 23 24 25 26 27 28 29 30 31 32 33 34-35 36-37

United States 57.0% 19.8% 41.1% 60.1% 53.0% 55.9% 65.9% 68.0% 48.6% 57.8% 61.2% 86.9% 74.6% 63.9% 58.1%

Australia 55.3% 28.3% 50.2% 65.0% 61.2% 47.1% 67.9% 72.1% - 70.2% - 74.4% 64.4% 66.6% 58.1%

Canada 59.0% 42.1% 48.4% 61.9% 53.4% 48.9% 68.2% 63.6% 92.8% 72.5% 74.1% - 62.2% 62.0% 59.6%

China 31.8% 20.3% 29.5% 36.1% 29.2% 24.0% 35.0% 34.2% 36.2% 38.4% 42.8% 43.0% 34.6% 19.7% 31.2%

Germany 61.0% 35.8% 57.5% 66.0% 70.1% 60.0% 70.0% 72.7% 65.5% 82.5% 66.8% 65.7% 79.4% 69.9% 68.6%

India 26.4% 8.1% 20.2% 31.6% 20.5% 28.7% 12.8% 34.3% 31.1% 26.1% 34.2% 48.6% 53.1% - 26.1%

Japan 43.9% 5.2% 36.6% 60.8% 49.4% 47.9% 62.1% 56.9% 49.5% 56.2% 53.4% 65.8% 65.5% 60.9% 49.7%

Mexico 29.0% 42.4% 35.5% 45.4% 28.0% 24.5% 44.6% 71.6% 42.1% 46.8% - - 34.8% 45.7% 34.4%

UK 69.5% 82.7% 58.5% 78.0% 70.6% 80.4% 76.2% 76.2% 59.0% 73.2% 73.3% 64.1% 81.0% 62.9% 71.1%

United States 37.3% 77.4% 56.1% 37.1% 44.7% 40.3% 32.4% 30.3% 51.0% 41.5% 37.7% 12.4% 23.4% 34.9% 38.7%

Australia 41.7% 69.6% 46.7% 31.3% 35.6% 50.6% 29.5% 25.1% - 25.4% - 23.0% 32.4% 31.2% 38.9%

Canada 38.8% 55.4% 49.1% 36.0% 43.9% 48.5% 29.6% 34.5% 5.9% 25.5% 23.4% - 36.2% 35.6% 38.3%

China 44.5% 45.8% 50.1% 45.2% 54.8% 52.3% 49.0% 48.0% 59.9% 46.1% 40.7% 42.0% 41.6% 73.7% 48.5%

Germany 37.5% 60.4% 39.9% 32.1% 28.3% 38.0% 28.1% 25.6% 33.9% 16.4% 32.9% 32.8% 20.1% 28.4% 29.9%

India 73.6% 91.9% 79.8% 68.4% 79.5% 71.3% 87.2% 65.7% 68.9% 73.9% 65.8% 51.4% 46.9% - 73.9%

Japan 38.8% 8.5% 54.1% 31.4% 41.6% 40.2% 30.6% 36.7% 43.0% 39.1% 39.7% 28.8% 28.6% 31.8% 35.7%

Mexico 70.3% 57.5% 63.0% 53.3% 71.6% 75.1% 54.2% 27.1% 56.9% 52.1% - - 64.8% 53.4% 64.8%

UK 29.0% 15.4% 40.1% 20.0% 27.1% 17.2% 22.1% 22.3% 40.5% 25.1% 25.6% 34.6% 17.7% 34.9% 27.4%

United States 5.8% 2.8% 2.8% 2.8% 2.3% 3.7% 1.7% 1.7% 0.4% 0.7% 1.2% 0.7% 2.0% 1.2% 3.1%

Australia 3.0% 2.1% 3.1% 3.7% 3.2% 2.4% 2.7% 2.8% - 4.3% - 2.7% 3.2% 2.2% 3.0%

Canada 2.2% 2.5% 2.4% 2.1% 2.8% 2.6% 2.2% 1.9% 1.3% 2.0% 2.5% - 1.6% 2.3% 2.2%

China 23.7% 33.9% 20.4% 18.6% 16.0% 23.7% 16.0% 17.8% 4.0% 15.5% 16.5% 15.0% 23.9% 6.6% 20.3%

Germany 1.5% 3.9% 2.5% 1.8% 1.6% 2.0% 2.0% 1.7% 0.5% 1.1% 0.3% 1.5% 0.5% 1.6% 1.5%

India 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% - 0.0%

Japan 17.4% 86.3% 9.2% 7.7% 9.0% 11.9% 7.4% 6.3% 7.4% 4.7% 6.9% 5.5% 6.0% 7.3% 14.6%

Mexico 0.6% 0.1% 1.5% 1.3% 0.4% 0.5% 1.2% 1.3% 1.0% 1.1% - - 0.5% 0.9% 0.8%

UK 1.5% 1.9% 1.3% 2.1% 2.2% 2.5% 1.7% 1.5% 0.5% 1.7% 1.1% 1.3% 1.3% 2.2% 1.6%

Compensation Gross Operating Surplus Taxes
35

Table 3.11: Input-Output Analysis using OECD STAN Data, mid-2000’s

Note: The green bars represent a visual comparison between each country for each category (listed in the 

top row). Higher values have longer bars.

3.2.3 Research and Development

Research and Development Expenditures: In addition to data on production, the STAN 

database provides estimates on research and development expenditures by nation. Similar 

to production data, national currencies are converted to dollars using the OECD 

purchasing power parity (PPP) rates for gross domestic product. Research and 

development data is available for 1999 through 2006.

To maintain a strong manufacturing environment, the U.S. must have a healthy 

investment in the research and development of new products. Significant concern has 

been expressed in regards to U.S. research and development expenditures compared to 

those abroad.52 This concern is primarily in regards to its proportion of global research 

and development expenditures.53 There is also concern that the share of U.S. patents filed 

by inventors residing in the U.S. has decreased in recent years as have peer-reviewed 

publications.54 As previously mentioned, it is important to examine the nation’s nominal 

and real performance relative to its resources. It should be expected that as emerging 

economies make progress in becoming developed countries that U.S. and other developed 

nation’s proportion of production and research will decline due to the growth of total 

global production and research activities. That is, it is not to be expected that the U.S. 

will keep up with the aggregate growth of global research and production as much of

these increases are the result of utilizing previously idle or under-utilized resources. A 

decline of the proportion of U.S. activities, therefore, is not unexpected. A greater 

concern is its nominal and real performance relative to its population and/or resources. It 

is in this context that this report will compare U.S. research and development to that of 

other nations.

 

52 Atkinson, Robert D. and David B. Audretsch. “Economic Doctrines and Policy Differences: Has the 

Washington Policy Debate Been Asking the Wrong Questions?” The Information Technology and 

Innovation Foundation. September 2008. < http://www.itif.org/files/EconomicDoctrine.pdf>

53 Tassey Gregory. “Rationales and Mechanisms for Revitalizing U.S. Manufacturing R&D Strategies.” 

Journal of Technology Transfer. 35 (2010). 283-333.

54 National Science Board. “Research and Development: Essential Foundation for U.S. Competitiveness in 

a Global Economy.” 2008. <http://www.nsf.gov/statistics/nsb0803/nsb0803.pdf>

Output

Nonmanufactured 

Products Used

Output

Nonmanufactured 

Products Used

Output

Nonmanufactured 

Products Used

Output

Nonmanufactured 

Products Used

Total 

Impact

Percent of 

Total Output

United States 335 115 1 118 393 3 485 1 000 4 938 1 508 6 446 27.9%

Australia 7 2 37 14 187 66 231 8 3 314 24.7%

Canada 25 5 136 29 384 110 544 145 689 33.8%

China 458 128 648 195 2 337 466 3 443 789 4 232 62.1%

Germany 170 40 644 185 955 273 1 769 498 2 267 44.9%

India 50 15 45 16 285 94 380 125 505 45.3%

Japan 386 136 848 235 1 648 261 2 882 633 3 515 41.2%

Mexico 57 9 69 16 252 79 378 103 481 41.8%

UK 57 15 187 62 531 164 775 241 1 016 24.8%

Electronics (ISIC 30-32) Machinery (ISIC 29, 33-35) Other (ISIC 15-28, 36-37) $Billion 2005Total (ISIC 15-37)
36

Although data is available on research and development, there have been calls for 

improvements in statistics on research and development along with innovation. Data on 

this subject has been identified as insufficient and underutilized.55 It is also important to 

note that there are concerns in the linkage of moving innovation into domestic 

manufacturing. That is, there are occasions where U.S. research and development 

produces a new technology only for that technology to be utilized in manufacturing 

overseas. It has been identified that in at least some cases this transfer was not the result 

of lower production costs, but rather a result of other market factors. The production of 

Lithium-ion batteries is an example of this type of issue.56 Concern has been expressed in 

that as some manufacturing activities move abroad that supporting activities may follow. 

According to the adjusted OECD STAN data in Table 3.12, the U.S. has the largest 

research and development expenditure for ISIC 15-22, 23, 24, 28, 29, 32, 33, 34-35, and 

for total manufacturing among those countries shown. In per capita terms, the U.S. has 

the largest research and development expenditures for ISIC 23, 24, 32, and 33. Germany 

spends nearly as much as the U.S. in per capita research and development for all 

manufacturing while Japan exceeds the U.S. expenditure by more than 30 %. 

As seen in Table 3.13, among all OECD countries for which data are available the U.S. 

ranks above the 95th percentile for total manufacturing research and development 

expenditures for all years. From 2001 through 2007, it was above the 90th percentile for 

all subsectors of manufacturing. In terms of per capita research and development 

expenditures, 2007 U.S. values rank above the 70th percentile for ISIC codes 15-22, 23, 

24, 29, 30, 32, 33, 34-35, 36-37, and total manufacturing (see Table 3.14).

Patents: OECD patent data includes the number of patents filed by the inventor’s country 

of residence for 48 countries including China and India as well as a world estimate. The 

OECD patent database includes applications to the European Patent Office (EPO) and 

U.S. Patent and Trademark Office (USPTO) as well as those filed under the Patent Cooperation Treaty (PCT) and Triadic Patent Families. Patents reflect inventive 

performance and, therefore, are a key measure of innovation. There are, however, some 

drawbacks in using patents to measure innovation. Many patents have no industrial 

application. Also, many inventions are not patented either because they are not patentable 

or the inventor uses other means of intellectual property protection such as secrecy. 

Finally, patent laws change over time and vary between countries making it difficult to 

draw solid conclusions from data comparisons.57 In contrast to these shortcomings, 

research by de Rassenfosse and van Pottelsberghe has shown a high correlation between 

patent numbers and R&D performance.58

 

55 National Science Foundation. “Advancing Measures of Innovation.” June 2006. 

<http://www.nsf.gov/statistics/nsf07306/>

56 Brodd, Ralph J. “Factors Affecting U.S. Production Decisions: Why are There No Volume Lithium-Ion 

Battery Manufacturers in the United States.” ATP Working Paper 05-01. June 2005. 

<http://www.atp.nist.gov/eao/wp05-01/wp05-01.pdf>

57 OECD. OECD Patent Statistics Manual. OECD 2009. 

<http://browse.oecdbookshop.org/oecd/pdfs/free/9209021e.pdf>

58 De Rassenfosse, G. and B. van Pottelsberghe “A Policy Insight into the R&D Patent Relationship.” ULB 

Working Paper. 2008.
37

According to OECD patent data, as seen in Table 3.15, between 1999 and 2007 the U.S. 

has ranked above the 90th percentile in terms of total number of patents and above the 

80th percentile in terms of patents per capita. During that same period, U.S. patents 

represented between 30 % and 41 % of total patents worldwide. This data is consistent 

with a patent analysis conducted by Thomson Reuters, which suggested that 

approximately 40 % of the top 100 global innovator companies are located in the United 

States.59 According to the OECD data, Japan is the only country that occasionally 

produced more patents than the U.S. while Luxembourg, Switzerland, and Japan 

produced more patents per capita in 2007.

Table 3.12: Research and Development Expenditures by Country, 2006 (OECD STAN Database)

* R&D data from China was unavailable for 2006. The data shown is adjusted from 2000.

Note: The green bars represent a visual comparison between countries. For example, the U.S. has the 

largest R&D value for ISIC 15-22; therefore, it also has the longest green bar.

 

59 Thomson Reuters. “Top 100 Global Innovators, 2011.” <http://www.top100innovators.com/overview>

Food, Textiles, Leather, Footwear, Wood Products, and Paper ProductsChemical, rubber, plastics and fuel products Other non-metallic mineral products Basic metals and fabricated metal productsMachinery and equipmentMachinery and equipment, n.e.c. Office, accounting and computing machineryElectrical machinery and apparatus, n.e.c.Radio, television and communication equipmentMedical, precision and optical instruments Transport equipmentMotor vehicles, trailers and semi-trailers Other transport equipmentManufacturing n.e.c. and recyclingTOTAL Manufacturing

ISIC 15-22 23 24 26 25 27 28 29 30 31 32 33 34-35 36-37

United States 4.52 1.44 46.33 1.01 2.25 0.65 1.50 9.85 7.37 2.28 31.18 22.40 37.26 - 172.73

Australia 0.52 0.07 0.37 0.07 0.05 0.35 0.09 0.17 0.04 0.03 0.16 0.30 0.61 0.02 2.86

Canada 1.07 0.11 1.22 0.05 0.04 0.21 0.15 0.42 0.30 0.11 2.09 0.19 1.30 - 7.56

China* 1.33 0.42 2.42 0.47 0.38 1.32 0.30 1.92 0.58 1.48 3.26 0.43 1.73 - 16.16

Germany 0.78 0.08 8.51 0.32 0.86 0.48 0.59 5.13 0.66 1.50 4.21 3.59 17.70 0.21 44.62

India - - - - - - - - - - - - - - -

Japan 1.36 0.47 17.01 1.19 2.55 2.61 0.94 9.36 14.58 9.18 12.62 4.76 19.34 - 99.74

Mexico - - - - - - - - - - - - - - -

UK - - - - - - - - - - - - - - -

United States 2.6% 0.8% 26.8% 0.6% 1.3% 0.4% 0.9% 5.7% 4.3% 1.3% 18.1% 13.0% 21.6% - 100.0%

Australia 18.3% 2.5% 13.1% 2.5% 1.7% 12.3% 3.2% 6.0% 1.3% 1.1% 5.5% 10.5% 21.4% 0.7% 100.0%

Canada 14.2% 1.5% 16.2% 0.6% 0.6% 2.8% 2.0% 5.5% 3.9% 1.4% 27.6% 2.5% 17.2% - 100.0%

China* 8.2% 2.6% 15.0% 2.9% 2.4% 8.2% 1.8% 11.9% 3.6% 9.2% 20.2% 2.6% 10.7% - 100.1%

Germany 1.8% 0.2% 19.1% 0.7% 1.9% 1.1% 1.3% 11.5% 1.5% 3.4% 9.4% 8.0% 39.7% 0.5% 100.0%

India - - - - - - - - - - - - - - -

Japan 1.4% 0.5% 17.1% 1.2% 2.6% 2.6% 0.9% 9.4% 14.6% 9.2% 12.7% 4.8% 19.4% 100.0%

Mexico - - - - - - - - - - - - - - -

UK - - - - - - - - - - - - - - -

United States 15.14 4.82 155.16 3.40 7.52 2.18 5.02 32.98 24.68 7.64 104.44 75.01 124.79 - 578.47

Australia 25.51 3.52 18.21 3.49 2.33 17.11 4.39 8.39 1.76 1.57 7.66 14.61 29.81 1.00 139.36

Canada 32.74 3.49 37.49 1.39 1.28 6.39 4.58 12.82 9.04 3.22 63.95 5.73 39.80 - 231.37

China 1.02 0.33 1.86 0.36 0.29 1.01 0.23 1.47 0.44 1.14 2.50 0.33 1.33 - 12.39

Germany 9.51 0.97 103.29 3.83 10.48 5.77 7.20 62.20 8.01 18.23 51.08 43.53 214.74 2.51 541.35

India - - - - - - - - - - - - - - -

Japan 10.70 3.68 133.37 9.30 20.02 20.45 7.38 73.42 114.31 72.01 98.96 37.35 151.66 - 782.21

Mexico - - - - - - - - - - - - - - -

UK - - - - - - - - - - - - - - - R&D ($billion 2006) Percent of Total R&D Per Capita R&D (2006)
38

Table 3.13: U.S. Research and Development Expenditures by Year, Percentile (OECD Structural 

Analysis Database)

Table 3.14: U.S. Research and Development per Capita by Year, Percentile (OECD Structural 

Analysis Database)

Food, apparel, wood product, and printing manufacturingRefined petroleum products and nuclear fuelChemicalsRubber and plasticsOther nonmetallic mineral productsBasic metalsFabricated metalsMachinery and equipmentOffice, accounting and computing machineryElectrical machinery and apparatus, n.e.c.Radio, television and communication equipmentMedical, precision and optical instrumentsTransport equipmentOther manufacturingTOTAL

ISIC 15-22 2 3 2 4 2 5 2 6 2 7 2 8 2 9 3 0 3 1 3 2 3 3 34-35 36-37

2001 95.8 94.1 95.7 95.5 91.7 91.3 95.5 95.7 94.4 91.3 95.5 95.7 95.5 95.5 96.0

2002 95.8 95.2 95.8 91.3 91.7 91.7 95.5 95.8 94.7 91.7 95.7 95.8 95.7 95.5 96.0

2003 96.0 94.7 95.8 91.3 92.0 92.0 95.8 91.7 94.7 91.7 95.7 95.8 95.7 95.7 96.3

2004 96.2 94.4 96.0 91.3 91.7 91.7 95.8 91.7 94.7 92.0 96.0 96.0 95.8 95.7 96.2

2005 96.2 94.7 95.8 91.3 92.0 92.0 95.8 96.0 94.7 92.0 95.8 96.0 95.8 95.8 96.3

2006 96.0 94.7 95.8 91.3 92.0 92.0 95.8 95.8 94.7 92.0 95.8 96.0 95.7 95.5 96.0

2007 96.3 94.7 95.8 91.3 92.6 92.6 96.0 95.8 95.0 92.0 96.0 96.0 95.8 95.7 96.3

2008 90.5 - 95.2 94.7 85.0 85.0 95.0 90.0 93.3 85.0 95.0 - 94.4 - 95.2

2001 2 4 1 7 2 3 2 2 2 4 2 3 2 2 2 3 1 8 2 3 2 2 2 3 2 2 2 2 2 5

2002 2 4 2 1 2 4 2 3 2 4 2 4 2 2 2 4 1 9 2 4 2 3 2 4 2 3 2 2 2 5

2003 2 5 1 9 2 4 2 3 2 5 2 5 2 4 2 4 1 9 2 4 2 3 2 4 2 3 2 3 2 7

2004 2 6 1 8 2 5 2 3 2 4 2 4 2 4 2 4 1 9 2 5 2 5 2 5 2 4 2 3 2 6

2005 2 6 1 9 2 4 2 3 2 5 2 5 2 4 2 5 1 9 2 5 2 4 2 5 2 4 2 4 2 7

2006 2 5 1 9 2 4 2 3 2 5 2 5 2 4 2 4 1 9 2 5 2 4 2 5 2 3 2 2 2 5

2007 2 7 1 9 2 4 2 3 2 7 2 7 2 5 2 4 2 0 2 5 2 5 2 5 2 4 2 3 2 7

2008 2 1 1 4 2 1 1 9 2 0 2 0 2 0 2 0 1 5 2 0 2 0 1 9 1 8 1 7 2 1

U.S. Percentile

Number of Countries 

Ranked

Food, apparel, wood product, and printing manufacturingRefined petroleum products and nuclear fuelChemicalsRubber and plasticsOther nonmetallic mineral productsBasic metalsFabricated metalsMachinery and equipmentOffice, accounting and computing machineryElectrical machinery and apparatus, n.e.c.Radio, television and communication equipmentMedical, precision and optical instrumentsTransport equipmentOther manufacturing TOTAL

ISIC 15-22 23 24 25 26 27 28 29 30 31 32 33 34-35 36-37

2001 87.5 82.4 73.9 81.8 79.2 39.1 86.4 82.6 83.3 87.0 81.8 91.3 86.4 81.8 92.0

2002 87.5 90.5 75.0 73.9 41.7 41.7 81.8 75.0 89.5 62.5 73.9 91.7 82.6 90.9 88.0

2003 88.0 89.5 79.2 73.9 56.0 56.0 70.8 75.0 89.5 58.3 73.9 91.7 91.3 82.6 88.9

2004 84.6 88.9 92.0 73.9 66.7 50.0 75.0 66.7 89.5 68.0 76.0 92.0 91.7 87.0 88.5

2005 88.5 84.2 95.8 69.6 60.0 52.0 66.7 80.0 89.5 60.0 75.0 92.0 87.5 87.5 92.6

2006 88.0 89.5 95.8 69.6 60.0 44.0 70.8 79.2 89.5 56.0 75.0 92.0 87.0 86.4 92.0

2007 88.9 94.7 95.8 69.6 55.6 51.9 68.0 75.0 85.0 56.0 76.0 92.0 87.5 87.0 92.6

2008 71.4 - 90.5 78.9 90.0 35.0 75.0 70.0 80.0 60.0 70.0 - 83.3 - 81.0

2001 24 17 23 22 24 23 22 23 18 23 22 23 22 22 25

2002 24 21 24 23 24 24 22 24 19 24 23 24 23 22 25

2003 25 19 24 23 25 25 24 24 19 24 23 24 23 23 27

2004 26 18 25 23 24 24 24 24 19 25 25 25 24 23 26

2005 26 19 24 23 25 25 24 25 19 25 24 25 24 24 27

2006 25 19 24 23 25 25 24 24 19 25 24 25 23 22 25

2007 27 19 24 23 27 27 25 24 20 25 25 25 24 23 27

2008 21 14 21 19 20 20 20 20 15 20 20 19 18 17 21

U.S. Percentile Number of Countries Ranked
39

Table 3.15: U.S. Patents (OECD Patent Database)

3.3 World Bank

The World Bank assists developing countries in financial and technical matters; however, 

it is not a bank in the traditional use of the term. It constitutes two institutions owned by 

187 member countries: the International Bank for Reconstruction and Development 

(IBRD) and the International Development Association (IDA). The World Bank provides 

low-interest loans, interest-free credits, and grants to developing countries to invest in 

education, health, public administration, infrastructure, financial and private sector 

development, agriculture, and environmental and natural resource management. It also 

provides international data on various topics, including science and technology. The 

sources used to assemble this data includes the UNESCO Institute for Statistics, the U.S. 

National Science Board, the UN Statistics Division, the International Monetary Fund, and 

the World Intellectual Property Organization.60 

As seen in Table 3.16, the U.S. ranks above the 85th percentile for all 2000-2009 science 

and technology indicators shown with many indicators being above the 95th percentile. 

The table also shows that the U.S. has the largest number of nonresident patent 

applications and the 2nd largest number of resident applications (third largest for 2009) 

during the same time period with Japan having the largest. In per capita terms, the U.S. 

had the 4th largest number of resident applications in 2000 and the 3rd largest for 2001 to 

2009. The U.S. maintains the largest number of scientific and technical journal articles61

between 2000 and 2007; however, it ranks between 12th and 15th in per capita terms.

Although these statistics do not directly measure research and development or innovation 

performance, it provides a proxy for comparing the U.S. to nations abroad. 

 

60 World Bank. World Development Indicators. Washington DC, World Bank, 2011. 

<http://www.worldbank.org/>

61 Scientific and technical journal articles are from journals classified by the Institute for Scientific 

Information. Specifically, it is from their Science Citation Index and Social Science Citation Index. Articles 

with authors from different countries are allocated proportionately. World Bank. World Development 

Indicators. Washington DC, World Bank, 2011. 314-317.

Year Percent of 

Total Patents

Total Patents 

Ranked 

(Percentile)

Patents per 

Capita Rank 

(Percentile)

Number of 

Countries 

Ranked

1999 32.6% 97.9% 85.1% 47

2000 30.7% 95.8% 83.3% 48

2001 31.3% 95.8% 83.3% 48

2002 32.4% 97.9% 87.2% 47

2003 32.9% 97.9% 87.2% 47

2004 34.3% 97.8% 89.1% 46

2005 37.9% 97.9% 93.8% 48

2006 40.6% 97.7% 93.0% 43

2007 37.6% 94.1% 88.2% 34
40

Table 3.16: U.S. Science and Technology Indicators, Percentile (World Bank)

3.4 International Comparative Indices

A number of organizations assemble and publish comparative indices on national 

economies and manufacturing activities. These include UNIDO, the World Economic 

Forum, and the World Bank to name a few. These indices can be used to gain additional 

insight into the U.S. economy and the manufacturing industry. Data from some of the

primary indices are discussed below. Many of the issues covered by these indices bleed 

into the category of the environment in which the manufacturing industry must operate 

rather than the trends and current state of manufacturing. However, these indices provide 

an international comparison of industry performance, labor productivity, and innovation 

among other things, providing a quantitative depiction of items related to the U.S. 

manufacturing industry.

UNIDO’s Competitive Industrial Performance Index (CIP): The CIP index uses four 

variables to benchmark industrial activity at the country level. These variables include 

manufacturing value added per capita, manufacturing exports per capita, industrialization 

intensity (simple average of the share of manufacturing value added in gross domestic 

product and the share of medium and high-technology activities in manufacturing value 

added), and export quality (simple average of the share of manufactured exports in total 

exports and the share of medium and high-technology activities in manufactured 

exports).62

 

62 UNIDO. “Industrial Development Scoreboard: Technical Notes.” 

<http://www.unido.org/index.php?id=5058>

Indicator Name 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Patent applications, nonresidents 98.9 98.9 98.8 98.8 98.9 98.9 98.8 98.7 98.7 98.1

Patent applications, residents 97.8 97.5 97.6 97.5 97.5 97.7 97.5 97.3 97.2 94.3

Patent applications per capita, nonresidents 87.8 88.8 88.2 88.1 87.8 88.8 87.1 88.5 86.7 90.7

Patent applications per capita, residents 95.5 96.3 96.4 96.3 96.3 96.5 96.3 95.9 95.8 94.3

Research and development expenditure (% of GDP) 94.5 92.8 94.6 93.3 92.2 92.0 91.0 91.9 88.2 -

Researchers in R&D (per million people) 94.2 91.4 93.7 91.0 90.9 87.0 87.3 - - -

Royalty and license fees, payments (BoP, current US$) 98.2 98.3 98.4 98.4 98.4 98.5 98.4 98.5 97.7 97.4

Royalty and license fees, receipts (BoP, current US$) 98.9 98.9 99.0 99.0 99.0 99.0 99.0 99.1 99.1 98.9

Scientific and technical journal articles 99.4 99.4 99.4 99.4 99.4 99.4 99.5 99.5 - -

Scientific and technical journal articles per capita 93.0 93.1 92.4 92.0 92.1 91.4 92.2 92.0 - -

Patent applications, nonresidents 90 89 85 84 90 89 85 78 75 54

Patent applications, residents 89 81 83 81 81 86 81 74 72 53

Patent applications per capita, nonresidents 90 89 85 84 90 89 85 78 75 54

Patent applications per capita, residents 89 81 83 81 81 86 81 74 72 53

Research and development expenditure (% of GDP) 73 83 93 90 90 88 78 74 34 0

Researchers in R&D (per million people) 52 58 63 67 66 69 63 57 30 0

Royalty and license fees, payments (BoP, current US$) 114 115 124 126 129 131 129 131 133 115

Royalty and license fees, receipts (BoP, current US$) 90 91 97 97 98 98 105 107 107 94

Scientific and technical journal articles 178 178 179 179 181 179 186 182 0 0

Scientific and technical journal articles per capita 172 173 172 175 177 174 179 176 0 0 Percentile Total Number of Countries Ranked
41

In 2003, Singapore was ranked number one in the Competitive Industrial Performance 

Index followed by Ireland, Switzerland, Japan, Belgium, Sweden, Finland, Germany, 

Korea, Taiwan Province, and France. The United States was ranked 12th or around the 

90th percentile, as seen in Table 3.17. In terms of manufactured value added per capita, 

the U.S. ranked just below the 90th percentile in 2003. The lowest ranking for the U.S. is 

its rank in the share of manufacturing value added in gross domestic product (GDP), 

which was below the 60th percentile in 2003. With the exception of this category, the U.S. 

ranked above the 70th percentile for all categories for all years.

Table 3.17: U.S. Competitive Industrial Performance Index Rankings (121 countries ranked)

World Economic Forum’s Global Competitiveness Report: The Global Competitiveness 

Report is a yearly report published by the World Economic Forum that ranks the world’s 

nations according to the Global Competitiveness Index. This report is commonly cited 

inreference to competitiveness issues. The ranking uses a weighted average of multiple 

components, which are categorized into 12 pillars of economic competitiveness: 

institutions, infrastructure, macroeconomic environment, health and primary education, 

higher education and training, goods market efficiency, labor market efficiency, financial 

market development, technological readiness, market size, business sophistication, and 

innovation.63 Each pillar includes subcategories and the most recent ranking included 139 

countries. Although this index measures the economy as a whole, it does provide insight 

into areas related to manufacturing. 

The overall 2010-2011 Global Competitiveness Index rank for the U.S. was 4th out of 139 

countries. This is down from 2nd in 2009-2010 and 1st in 2008-2009. Figure 3.8 illustrates 

the rankings of the U.S. among the twelve pillars and the overall rank. The outer edge of 

the wheel represents a high ranking such as 1st or 2nd while the inner part represents a low 

ranking. Each spoke on the wheel has four tick marks representing 1st, 47th, 93rd, and 

139th. Also included in this figure are nations that are the same countries listed in Table 

3.2. These countries represent major U.S. trading partners, countries that are often 

considered competitors with the U.S., and nations that are similar to the U.S. Figure 3.8

is organized so that the overall rank is at the top followed by the 12 pillars in order from 

the highest ranking items for the U.S. to the lowest ranking items going in a clockwise 

fashion. The lowest ranking item is the macroeconomic environment and the highest 

ranking item is market size. The U.S. ranks 4th in innovation, 4th in labor market 

efficiency, and 17th in technological readiness.

 

63 World Economic Forum. The Global Competitiveness Report. 2010-2011. 

<http://www3.weforum.org/docs/WEF_GlobalCompetitivenessReport_2010-11.pdf>

1993 1998 2003 1993 1998 2003

Industrial Performance Index 91.0 91.5 90.0 100 118 120

Manufactured Value Added per Capita 90.9 90.1 89.3 121 121 121

Share of Manufacturing Value Added in GDP (Percentage) 55.4 59.5 53.7 121 121 121

Industrialization Intensity Indicator 92.6 93.4 90.1 121 121 121

Share of Medium- and High-tech Value Added in

 Total Manufacturing Value Added (Percentage)

93.3 96.6 94.1 120 119 119

Percentile Number of Countries Ranked
42

A more comprehensive table of the rankings is available in Appendix A. This table is 

organized into the twelve pillars and their subcategories ordered from highest ranking to 

lowest ranking. Subcategories ranking below the 70th percentile are highlighted in yellow 

and subcategories ranking below the 50th percentile are highlighted in red.

IMD World Competitiveness Center’s World Competitiveness Yearbook: The 

International Institute for Management Development (IMD) is a non-profit business 

school in Switzerland that has gained international recognition. The World 

Competitiveness Yearbook is a product of IMD’s World Competitiveness Center. The 

Yearbook is a ranking of nations based on their ability to create and maintain an 

environment where enterprises can compete. This environment is broken into 4 factors: 

economic performance, government efficiency, business efficiency, and infrastructure. 

Each of these factors is broken into 5 sub-factors for a total of 20, which are given equal 

weight in determining overall rank among the 59 countries evaluated. There are over 300 

criteria used to determine the sub-factors. According to the Yearbook, the U.S. ranked 1st

in overall competitiveness in 2011. It also ranked 1st in domestic economy and scientific 

infrastructure. Its ranking for technology infrastructure was 2nd. A complete ranking of 

the U.S. and a selection of nations is available in Appendix B.

Figure 3.8: Global Competitiveness Index Ranking (139 countries) by Category, 2010-2011

Note: The outer edge of the wheel represents a high ranking such as 1st or 2nd while the inner part represents 

a low ranking. Each spoke on the wheel has four tick marks representing 1st, 47th, 93rd, and 139th.

1

47

93

139

Overall Rank

Market Size

Innovation

Labor Market Efficiency

Business Sophistication

Higher Education and Training

Technological Readiness Infrastructure

Goods Market Efficiency

Financial Market Development

Institutions

Health and Primary Education

Macroeconomic Enviornment

United States

Australia

Canada

China

Germany

India

Japan

Mexico

UK
43

4 Domestic Data

This chapter presents data on the domestic U.S. manufacturing industry. The international 

data provided valuable context to the U.S. industry; however, more exhaustive data is 

available on the U.S. industry alone. These details include goods and services used by the 

industry; trends in subsector value added, net income, employment, and compensation; 

and subsector research and development expenditures. These items each contribute to 

depicting the U.S. manufacturing industry by providing more detailed information than is 

provided through international data. 

As previously discussed, a successful industry might be considered one that has a suitable 

magnitude of production that results in competitive net benefits for its stakeholders. It is 

on this basis, to examine net benefits of U.S. stakeholders, that data was selected to be 

incorporated into this chapter. The data includes the total manufacturing value added, net 

income, compensation, and employment among other things. Although there are a 

number of sources for data, a few of them provide considerably more detail than others. 

The sources of data to be examined in this chapter include the Census Bureau; Bureau of 

Economic Analysis; Bureau of Labor Statistics; and the National Science Foundation. 

These are some of the most cited sources of domestic manufacturing data available. The 

Annual Survey of Manufactures from the Census Bureau provides detailed subsector data 

on value added, shipments, net income, depreciation of assets, compensation, and goods 

and services purchased by the manufacturing industry. It is among the most 

comprehensive datasets on the industry. The Census Bureau also provides shipment data 

through its Manufacturers’ Shipments, Inventories, and Orders Survey. The Bureau of 

Economic Analysis provides a detailed accounting of manufacturing activity through its 

Annual Industry Accounts, including value added by industry and input-output data. This 

data provides a detailed account of the intermediate goods and services used by each 

subsector of the manufacturing industry. The Bureau of Labor Statistics provides data 

related to the compensation of employees, including employment, productivity, and 

wages. Finally, the National Science Foundation provides data on research and 

development expenditures, which reflects the advancement of the manufacturing 

industry. Each dataset in this chapter provides indispensable data relating to the net 

benefits received by manufacturing stakeholders.

4.1 Census Bureau

The Census Bureau has played a central role in tracking U.S. economic and demographic 

information since 1902 when it officially “opened its doors.” The mission of the 

organization is “to serve as the leading source of quality data about the nation’s people 

and economy.” The Bureau provides three datasets relating to manufacturing activity: the 

Annual Survey of Manufactures, Economic Census, and the Manufacturers’ Shipments, 

Inventories, and Orders Survey. 
44

4.1.1 Annual Survey of Manufactures and the Economic Census

The Annual Survey of Manufactures (ASM) is conducted every year except for years 

ending in 2 or 7 when the Economic Census is conducted. The ASM provides statistics 

on employment, payroll, supplemental labor costs, cost of materials consumed, operating 

expenses, value of shipments, value added, fuels and energy used, and inventories. It uses 

a sample survey of approximately 50 000 establishments with new samples selected at 5-

year intervals. The ASM data allows the examination of multiple factors (value added, 

payroll, energy use, and more) of manufacturing at a detailed subsector level. The 

Economic Census, used for years ending in 2 or 7, is a survey of all employer 

establishments in the U.S. that has been taken as an integrated program at 5-year intervals 

since 1967. Both the ASM and the Economic Census use NAICS classification; however, 

prior to NAICS the Standard Industrial Classification system was used.64

In 2009, the total value of shipments in manufacturing was $4.44 trillion. This figure 

represents the net selling value of products sold, transferred, or shipped on consignment. 

These products were made by or for an establishment (an establishment is a single 

physical location where manufacturing is conducted; this should not be confused with an 

enterprise or company) from material owned by the establishment. The figure for 

shipments requires careful interpretation as it includes the sale of intermediate as well as 

finished goods, which results in counting the value of some products twice. For instance, 

the value of an alternator for a car may be counted once when it is shipped to an auto 

assembly plant and once when the finished car is sold. The total value added is the best 

measure available for comparing the relative economic importance of manufacturing 

among other industries. Value added is equal to the value of shipments less the cost of 

materials, supplies, containers, fuel, purchased electricity, and contract work. It is 

adjusted by the addition of value added by merchandising operations plus the net change 

in finished goods and work-in-process goods. Value added avoids the duplication caused 

from the use of products of some establishments as materials. It is important to note that 

the BEA and the ASM calculate value added differently. The BEA calculates value added 

as “gross output (sales or receipts and other operating income, plus inventory change) 

less intermediate inputs (consumption of goods and services purchased from other 

industries or imported).”65 Moreover, the difference is that ASM’s calculation of value 

added includes purchases from other industries such as mining and construction while 

BEA’s does not include it. 

The ASM value added for all manufacturing was $1 978.0 billion in 2009. 

Approximately 9.8 % of this value is computer and electronic product manufacturing as 

can be calculated from the data in Table 4.1. This sector increased 15.5 % from $214.3 

billion in 1997 to $247.6 billion in 2000. During the early 2000’s recession it declined to 

a low of $182.9 billion in 2002, but increased until the late 2000’s recession as illustrated

in Figure 4.1. It is important to note that the values in this figure were adjusted using the 

producer price index for each industry (sectors 333, 334, 335, and 336 were estimated for 

 

64 Census Bureau. “Annual Survey of Manufactures.” < http://www.census.gov/manufacturing/asm/>

65 Horowitz, Karen J. and Mark A. Planting. Concepts and Methods of the U.S. Input-Output Accounts.

Bureau of Economic Analysis. 2006.
45

1997 to 2002 using an average rate of change between 2003 and 2009). The selection of a 

price index is particularly important for sector 334 as the prices of computer and 

electronic products have declined while most other prices have increased. This sector is 

considered to be the high-tech manufacturing sector.66 If an increasing price index were 

used to adjust sector 334, it would appear as though the industry were in a constant 

decline. This is also the case for the semiconductor and related device manufacturing 

sector in Figure 4.2. This issue is complicated by uncertainty in the accuracy of the price 

Figure 4.1: Value Added and Employment for Select Manufacturing Subsectors, Annual Survey of 

Manufactures (adjusted using industry specific PPI)

* The 1997 to 2002 PPI was estimated using the average annual price change between 2002 and 2009

Note: NAICS 311-323 (food, beverage, textile, apparel, paper, and printing), 337 (furniture and related 

products), and 339 (miscellaneous manufacturing) were omitted in order to allow a more detailed view of 

sectors related to medium- and high-tech manufacturing

 

66 Kelley, Charles, Mark Wang, Gordon Bitko, Michael Chase, Aaron Kofner, Julia Lowell, James 

Mulvenon, David Ortiz, and Kevin Pollpeter. “High-Technology Manufacturing and U.S. 

Competitiveness.” RAND Technical Report. March 2004. 

<http://www.rand.org/pubs/technical_reports/2004/RAND_TR136.pdf>

0

50

100

150

200

250

300

350

400

450

1997

1999

2001

2003

2005

2007

2009

Value Added ($Billion 2009)

Nonmetallic mineral product mfg

(327)

Electrical equipment, appliance, &

component mfg (335)*

Primary metal mfg (331)

Petroleum & coal products mfg (324)

Plastics & rubber products mfg (326)

Machinery mfg (333)*

Fabricated metal product mfg (332)

Computer & electronic product mfg

(334)*

Transportation equipment mfg

(336)*

Chemical mfg (325)

0

500

1000

1500

2000

1997

2000

2003

2006

2009

Employees 

(thousands)
46

Table 4.1: Subsectors of Manufacturing, Annual Survey of Manufactures 2009

Note: The green bars represent a visual comparison between subsectors (listed in the left column) for each category (listed in the top row). Higher values have 

longer bars.

NAICS

Number of 

Employees

Compensation, 

Payroll and 

Benefits ($1000)

Value Added 

($1000)

Net Income 

($1000)

Compensation 

per Employee 

($1000)

Value Added 

per Employee 

($1000)

Net Income 

per Employee 

($1000)

Net Income per 

Expenditure 

Dollar

311-323 Food, beverages, textiles, apparel, paper, and printing mfg 3 124 186 156 465 345 511 953 541 213 288 376 50.1 163.9 68.3 0.24

324 Petroleum & coal products mfg 101 559 11 218 562 78 558 603 23 661 442 110.5 773.5 233.0 0.05

325 Chemical mfg 724 683 62 223 691 328 870 852 181 231 086 85.9 453.8 250.1 0.43

326 Plastics & rubber products mfg 672 794 35 422 443 82 294 714 17 425 905 52.6 122.3 25.9 0.12

327 Nonmetallic mineral product mfg 360 426 20 716 516 48 899 753 8 520 169 57.5 135.7 23.6 0.11

331 Primary metal mfg 354 831 24 746 316 48 169 964 -4 420 471 69.7 135.8 -12.5 -0.03

332 Fabricated metal product mfg 1 296 600 73 269 815 146 876 281 28 875 280 56.5 113.3 22.3 0.12

333 Machinery mfg 962 083 63 539 945 133 056 578 24 575 525 66.0 138.3 25.5 0.10

334 Computer & electronic product mfg 908 299 76 790 501 193 242 334 51 326 615 84.5 212.8 56.5 0.19

335 Electrical equipment, appliance, & component mfg 352 940 21 800 021 50 498 178 13 768 429 61.8 143.1 39.0 0.16

336 Transportation equipment mfg 1 240 320 97 895 792 229 642 082 65 962 477 78.9 185.1 53.2 0.14

337 Furniture & related product mfg 360 210 15 968 585 32 235 361 5 710 641 44.3 89.5 15.9 0.11

339 Miscellaneous mfg 592 410 35 502 295 93 719 105 29 925 935 59.9 158.2 50.5 0.27

31-33 TOTAL Manufacturing 11 051 341 695 559 827 1 978 017 346 659 851 409 62.9 179.0 59.7 0.18

NAICS

Total Value of 

Shipments 

($1000)

Value of 

Production 

($1000)

Total Cost of 

Materials 

($1000)

Cost of 

Buildings and 

Structures 

($1000)

Cost of 

Machinery and 

Equipment 

($1000)

Other Costs 

($1000)

Net 

Inventories 

($1000)

Total 

Depreciation of 

Assets ($1000)

311-323 Food, beverages, textiles, apparel, paper, and printing mfg 1 126 141 857 881 701 643 610 779 377 10 066 479 25 426 153 78 964 289 -3 180 432 27 971 406

324 Petroleum & coal products mfg 497 875 474 467 291 734 419 743 225 2 110 750 16 212 310 18 006 887 480 910 7 403 208

325 Chemical mfg 628 945 803 425 708 250 296 725 926 5 527 042 17 979 903 43 251 688 -3 383 289 18 623 178

326 Plastics & rubber products mfg 171 185 548 145 963 337 87 355 685 2 176 701 5 144 301 15 864 207 -1 561 292 6 235 014

327 Nonmetallic mineral product mfg 90 395 938 75 662 944 40 196 667 1 012 045 3 871 031 9 866 685 -1 272 312 4 940 513

331 Primary metal mfg 168 297 912 162 676 210 115 973 007 1 476 227 6 917 667 13 562 993 -4 190 486 5 851 687

332 Fabricated metal product mfg 281 316 544 240 771 991 130 624 569 4 069 076 7 307 373 25 501 158 -3 833 336 7 835 937

333 Machinery mfg 287 634 198 253 369 592 151 115 284 3 244 628 6 531 819 28 937 916 -3 345 367 6 343 714

334 Computer & electronic product mfg 327 991 364 264 672 505 133 896 248 5 625 231 9 830 986 38 529 539 -719 347 11 272 897

335 Electrical equipment, appliance, & component mfg 106 650 713 88 655 438 54 562 019 1 108 437 2 473 749 8 711 212 -1 584 368 2 642 478

336 Transportation equipment mfg 545 018 370 469 077 710 319 871 616 3 795 734 11 197 690 36 316 878 4 167 802 14 145 985

337 Furniture & related product mfg 60 826 897 53 375 231 27 927 766 939 685 859 572 7 679 623 -596 674 1 144 351

339 Miscellaneous mfg 143 915 487 110 124 550 49 655 914 2 183 976 3 255 938 19 526 427 -562 405 3 302 597

31-33 TOTAL Manufacturing 4 436 196 105 3 639 051 135 2 438 427 303 43 336 011 117 008 492 344 719 502 -19 580 596 117 712 965
47

Figure 4.2: Value Added and Employment for Semiconductor and Other Computer Component 

Manufacturing

* The 1997 to 2002 PPI was estimated using the average annual price change between 2002 and 2009

indices available. Research by Houseman et al67 as well as Byrne et al68 has brought into 

question the accuracy of price measurement and its effect on measuring value added. For

the time being, the BLS price indices are the best available for broad examination of the 

manufacturing industry.

Employment in semiconductor and related device manufacturing, as seen in Figure 4.2, 

has experienced a significant decline as have a number of other sectors. During the 1997 

to 2009 period employment declined for all sectors shown in Figure 4.1: petroleum and 

coal products declined 6 %; chemicals 18 %; plastics and rubber 34 %; nonmetallic 

mineral products 28 %; primary metals 41 %; fabricated metal 26 %; machinery 32 %; 

computer and electronic products 46 %; electrical equipment, appliance, and components 

41 %; and transportation 33 %. As seen in Figure 4.3, each subsector’s 2009 proportion

 

67 Houseman, Susan, Christopher Kurz, Paul Lengermann, and Benjamin Mandel. “Offshoring and the 

State of American manufacturing.” W.E. Upjohn Institute for Employment Research. June 2010 

<http://www.upjohn.org/publications/wp/10-166.pdf>

68 Byrne, David, Brian K. Kovak, and Bryan Michaels, “Offshoring and Price Measurement in the 

Semiconductor Industry.” In Susan N. Houseman and Kenneth F. Ryder, eds., Measurement Issues Arising 

from the Growth of Globalization. (Washington, DC: National Academy of Public Administration, 2010): 

169-194.

0

10

20

30

40

50

1997

1999

2001

2003

2005

2007

2009

Value Added ($Billion 2009)

Computer terminal manufacturing

(334113)

Electronic capacitor manufacturing

(334414)

Electronic resistor manufacturing

(334415)

Computer storage device

manufacturing (334112)

Electronic computer manufacturing

(334111)

Printed circuit assembly (electronic

assembly) manufacturing (334418)*

Semiconductor and related device

manufacturing (334413)

0

50,000

100,000

150,000

200,000

250,000

1997

1999

2001

2003

2005

2007

2009

Employees
48

Figure 4.3: Manufacturing Employment and Valued Added, 2009

of employment and value added vary considerably. Computer and electronic 

manufacturing, for example, represents 8 % of employment but 10 % of value added. 

Chemical manufacturing represents 7 % of employment and 17 % of value added.

There has been some concern regarding the decline of manufacturing’s share of GDP; 

however, this downward trend seems to pervade as far back as BEA data is available in 

1947 through the manufacturing golden era of the 1950’s and 1960’s,

69 as seen in Figure 

4.4. During the same time period, expenditures on manufactured goods as a share of total 

expenditures declined. These downward trends suggest that the recent decline in 

manufacturing’s share of GDP is not the sole result of recent trends in offshoring

manufacturing activity. During the same time period, manufacturing value added has had 

an upward trend. As discussed later in this report, employment as a share of total 

employment has also had a downward trend (with the exception of the World War II era) 

going back as far as 1919. 

Broad data covering the entire manufacturing industry is shown in Table 4.1 while 

detailed 2009 data is available in Appendix C, which contains the number of employees, 

value added, total value of shipments, net income, and other metrics for chemical 

manufacturing (NAICS 325); machinery manufacturing (NAICS 333); computer and 

electronic products manufacturing (NAICS 334); electrical equipment, appliance, and 

component manufacturing (NAICS 335); and transportation equipment manufacturing 

(NAICS 336) along with all the subsectors. According to this data, semiconductor and 

other electronic components manufacturing (NAICS 3344) is 3.0 % of the manufacturing 

industry and has a net income per expenditure dollar ratio of 0.173. Net income is the 

total value of shipments less all costs, depreciation, and compensation. Similar to 

previous tables, the green colored bars in Table 4.1 provide a visual comparison between 

industries. Chemical manufacturing represents a large proportion of manufacturing net 

 

69 Hopp, Wallace J. and Mark L. Spearman Factory Physics. Third Edition. (Long Grove, IL: Waveland 

Press, 2011): 37-38.

32%

1%

6% 7%

3%

3% 12%

9%

8%

3%

11%

5%

Employment

27%

17% 4%

4%

2%

2%

7%

7%

10%

3%

12%

5%

Value Added

Food, apparel, wood product, and printing mfg

Petroleum & coal products mfg

Chemical mfg

Plastics & rubber products mfg

Nonmetallic mineral product mfg

Primary metal mfg

Fabricated metal product mfg

Machinery mfg

Computer & electronic product mfg

Electrical equipment, appliance, & component mfg

Transportation equipment mfg

Miscellaneous mfg
49

Figure 4.4: Manufacturing as a Percent of GDP (BEA)

income and value added when compared to other manufacturing sectors. It also maintains 

the highest net income per expenditure dollar. Petroleum and coal products 

manufacturing has the highest compensation per employee as well as the highest value 

added per employee. The value of production is the sum of all costs, including 

compensation. Sectors 311-323 have the largest value of production followed by 

transportation (336) and petroleum and coal (324). Net inventories is the sum of all end 

of year inventories less the sum of all the beginning of year inventories. Inventories need 

to be accounted for, as some sales are due to products produced in previous years. 

Figure 4.5 brings together manufacturing data in a diagram of the manufacturing industry 

supply chain. The net income for all manufacturing is $777.6 billion. The total value of 

production is $3 639.1 billion with $43.4 billion for buildings. The items in blue 

represent purchased services, computer hardware, software, and other costs. Gold 

represents refuse removal, intermediate goods, and recycling while orange represents 

machinery, structures, and compensation with red being the repair of the machinery and 

structures. Green represents the total cost of materials. These items all feed into the 

design and production of goods that are inventoried and/or shipped. Purchased objects 

such as structures and computer equipment depreciate as shown in grey. 

4.1.2 Manufacturers’ Shipments, Inventories, and Orders Survey

The Manufacturers’ Shipments, Inventories, and Orders survey provides monthly 

statistical data on current economic conditions and future production commitments in 

manufacturing. It includes establishments with $500 million or more in annual shipments. 

The survey has been conducted monthly since 1957. Data in NAICS format are only 

available from 1992 onwards. Data between 1958 and 2000 is available in SIC format. 

Although these data provide information on inventories and orders, this report focuses on 

0

200

400

600

800

1000

1200

1400

1600

1800

2000

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

1947195019531956195919621965196819711974197719801983198619891992199519982001200420072010

Manufacturing Value Added ($billion 2009)

Percent of Total

Manufacturing as a Percent of Total GDP

Consumption Expenditures on Manufactured

Goods as a Percent of Total Expenditures

Manufacturing Value Added
50

Figure 4.5: Manufacturing Industry Supply Chain, 2009
51

shipments. These data are more consistent with the annual survey of manufactures and 

BEA data, which also track shipments.70

As seen in Figure 4.6, manufacturing shipments have varied between 1958 and 2000; 

however, these have a general upward trend. Machinery and equipment as well as 

computer and office equipment manufacturing also appears to have a general upward 

trend as well. Automotive equipment seems to be increasing slightly. Although this figure 

is adjusted using the CPI for all goods and therefore does not accurately represent 

changes in the physical volume of production, it is the best representation possible since 

the PPI is not available for the same time span. The consumer price index has a strong 

upward trend with the exception of the 2008-2009 period where it decreased slightly. As 

mentioned previously, some products have decreased in price; these include computer 

and electronic products. It is possible, therefore, that shipments of computer and office 

equipment in Figure 4.6 have increased more rapidly than otherwise shown.

As seen in Figure 4.7, food, apparel, wood product, and printing manufacturing 

represents a significant proportion of the manufacturing industry, which is consistent with 

previous data sets discussed. In 2009, it represented 26 % of manufacturing (see pie 

charts in Figure 4.7); this is down from 31 % in 1992. With the exception of food,

apparel, wood product, and printing manufacturing, data was adjusted using sector 

specific PPI. As noted in the figure, sectors 333, 334, 335, 336 were adjusted using 

related subsectors. These PPI values were used because the PPI for the listed sector is 

available only for 2003 onwards. The pie charts were generated using unadjusted data so 

Figure 4.6: Manufacturing Shipments, 1958-2000 (Manufacturers' Shipments, Inventories, and 

Orders Survey)

Note: Adjusted using the Consumer Price Index.

 

70 Census Bureau. “Manufacturers’ Shipments, Inventories, and Orders.” 

<http://www.census.gov/manufacturing/m3/>

0

1000

2000

3000

4000

5000

6000

0

200

400

600

800

1000

1200

1400

19581960196219641966196819701972197419761978198019821984198619881990199219941996199820002002200420062008

$Billion 2009 (Total Manufacturing)

$Billion 2009 (Subsectors of Manufacturing)

Automotive Equipment

Machinery and Equipment

Computer and Office Equipment

Total Manufacturing (NAICS)

Total Manufacturing (SIC)
52

Figure 4.7: Manufacturing Shipments, 1992-2009 (Manufacturers' Shipments, Inventories, and 

Orders Survey)

* Sectors 333, 334, 335, and 336 were adjusted using the PPI for sectors 3332, 3342, 3352, and 336991 

Note: Pie charts were created using unadjusted data

as to maintain proportional relationships. Computer and electronic product manufacturing 

represents 8 % of manufacturing shipments down from 10 % in 1992. This decline may 

be due to changes in the price of computer and electronic product manufacturing and not 

due to a decline in the volume of physical production. This industry grew by 47 % 

between 1992 and 2009, faster than any other industry shown in Figure 4.7. 

Transportation equipment manufacturing; machinery manufacturing; and electrical 

equipment, appliances, and component manufacturing represent 13 % (down from 15 % 

in 1992), 6 % (the same as 1992), and 2 % (down from 3 % in 1992), respectively. These 

industries grew 10.5 %, 14.0 %, and 19.4 %, respectively.

4.2 Bureau of Economic Analysis

The Bureau of Economic Analysis (BEA) is an entity of the Department of Commerce 

that produces national, regional, and industry data that depict economic growth and 

0

500

1000

1500

2000 1992 1994 1996 1998 2000 2002 2004 2006 2008 $Billion 2009

nonmetallic mineral product manufacturing 

(327)

electrical equipment, appliance, and 

component manufactuing (335)

miscellaneous manufacturing (339)

plastics and rubber products manufacturing 

(326)

primary metal manufactuing (331)

machinery manufactuing (333)

fabricated metal product manufactuing (332)

computer and electronic product 

manufacturing (334)

petroleum and coal products manufacturing 

(324)

transportation equipment manufactuing (336)

chemical manufacturing (325)

Food, Apparel, Wood Product, and Printing 

Manufacturing (311-323)

2 % 3 % 3 % 4 %

4 %

6 %

6 %

10%

5 %

15%

11%

31% 2 % 2 % 3 % 4 %

4 %

6 %

7 %

8 %

11% 13%

14%

26%
53

interindustry relationships.71 This report utilizes two BEA data sets: gross domestic 

product by industry and the input-output accounts. The GDP by industry accounts 

provide estimates of value added by industry, which is defined as gross sales (sales or 

receipts and other operating income, commodity taxes, and inventory change) less 

intermediate inputs (energy, raw materials, semi-finished goods, and purchased services). 

The BEA input-output data provides data on the interrelationships between industries. It 

provides data on how industries provide inputs and use outputs from each other to 

produce final goods and services to the end user. The Leontief input-output model 

provides a framework for utilizing BEA’s input-output data; however, the data must be 

modified to be used in this type of analysis.

4.2.1 Production

BEA GDP by industry is available from 1947 to 2009; however, as discussed previously

the producer price index is not available prior to 1985. Therefore, the consumer price 

index is used to adjust the values in Figure 4.8. As illustrated in this figure, U.S. GDP

Figure 4.8: U.S. GDP by Industry ($billions 2009), BEA

 

 

71 Bureau of Economic Analysis. “U.S. Economic Accounts.” <http://www.bea.gov/>

26%

8%

2%

1%

6% 10% 6% 4% 3%

11%

3%

2%

3% 3%

12% 11% 1% 2% 2%

4%

5%

6%

3%

4%

21% 12%

9%

4%

2%

14%

0

2000

4000

6000

8000

10000

12000

14000

16000

1947195119551959196319671971197519791983198719911995199920032007

$Billions 2009

Government

Other services, except government

Arts, entertainment, recreation,

accommodation, and food services

Educational services, health care,

and social assistance

Professional and business services

Finance, insurance, real estate,

rental, and leasing

Information

Transportation and warehousing

Retail trade

Wholesale trade

Construction

Utilities

Mining

Agriculture, forestry, fishing, and

hunting

Manufacturing

8%

0% 1%

2% 4%

5%

5%

2%

5% 24%

14%

10%

4% 2%

14%

Percent of Growth: 

1947-2009
54

grew 501 % between 1947 and 2009 while manufacturing grew 164 %. As seen in Figure 

4.9, manufacturing’s average annual ten year growth (10 year moving average) has 

declined from around 5 % in 1957 to -1 % in 2009. During nearly the same period, the 

ratio of imported goods to manufacturing value added has increased from 0.11 in 1960 to 

0.99 in 2009. Since manufacturing grew slower than the whole of the U.S. economy, it 

went from representing 26 % of GDP to 11 % of GDP (see Figure 4.8). Manufacturing 

represented 8 % of growth while the largest growth sector was the finance, insurance, real 

estate, rental, and leasing sector with real estate representing the majority of this growth. 

The fastest growing sector was the educational services, health care, and social assistance 

sector followed by the professional and business services sector, growing 2641 % and 

2083 %. Approximately 63 % of the professional and business services sector is 

professional, scientific, and technical services such as computer system design. Although 

the finance, insurance, real estate, rental, and leasing sector accounted for a larger percent 

of growth, it was the third fastest growing sector at 1134 %. With other industries 

growing faster and the real estate industry having grown to be larger than the whole of 

the manufacturing industry, it is important to note that in a world of limited and scarce 

resources that the growth of one industry may result in a decline in another industry. That 

is, resources might be diverted from one industry to be invested into another industry.72 It 

is also interesting to note that although real estate has grown by 148 % between 1977 and 

2009, construction has only grown by 64 %. That is, the real estate industry is growing at 

a rapid rate while the constructed part of real estate seems to be changing a bit slower.

Manufacturing value added as a ratio of shipments, as seen in Figure 4.10, provides a 

proxy for tracking U.S. activities involved in producing manufactured goods. As seen in 

the figure, this ratio has varied somewhat over time dipping during or near times of 

recession. Note that there was a recession in 1973-1975, 1980, 2001, and 2007-2009 

during which times the ratio dips and recovers. 

Food, apparel, wood product, and printing manufacturing made up 29 % of 

manufacturing in 1977, as seen in Figure 4.11. It is important to note that this figure was

adjusted using the consumer price index; therefore, it maintains proportional relationships

Figure 4.9: 10 Year Moving Average of Annual Growth in the Manufacturing Industry and Ratio of 

Imported Goods to Manufacturing Value Added

 

72 National Public Radio. “Stopping the ‘Brain Drain’ of the U.S. Economy.” February 6, 2012. 

<http://www.npr.org/2012/02/05/146434854/stopping-the-brain-drain-of-the-u-s-economy?ft=1&f=100>

0

0.2

0.4

0.6

0.8

1

1.2

1.4

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

19571961196519691973197719811985198919931997200120052009

Ratio of imported goods to 

value added

10 Year moving average 

annual growth

Manufacturing: 10 year

moving average annual

growth (Adjusted with CPI)

Manufacturing: 10 year

moving average annual

growth (Adjusted with PPI)

Ratio of imported goods to

manufacturing value added
55

but does not reflect changes in the physical volume of production over time. For example, 

comparing computer and electronic products manufacturing in Figure 4.11 with that of 

Figure 4.12, which uses the PPI for each industry, reveals that using the CPI for all items 

makes it appear that this industry declined 3.7 % between 2000 and 2009. According to 

Figure 4.10: Ratio of BEA Value Added to Shipments from the Manufacturers' Shipments, 

Inventories, and Orders Survey

Note: Periods of recession are shown in grey.

Figure 4.11: Manufacturing GDP (BEA), 1977-2009

Note: Adjusted using the CPI for All Items

0.20

0.25

0.30

0.35

0.40

19581960196219641966196819701972197419761978198019821984198619881990199219941996199820002002200420062008

Ratio of BEA Value Added to Value of Shipments (SIC)

Ratio of BEA Value Added to Value of Shipments (NAICS)

0

100

200

300

400

500

1977

1980

1983

1986

1989

1992

1995

1998

2001

2004

2007

$Billions 2009

Petroleum and coal products

Nonmetallic mineral products

Electrical equipment, appliances, and components

Primary metals

Miscellaneous manufacturing

Plastics and rubber products

Other transportation equipment

Motor vehicles, bodies and trailers, and parts

Machinery

Fabricated metal products

Computer and electronic products

Chemical products

Food, apparel, wood product, and printing

2% 3% 4% 7%

2%

4%

5%

9%

6% 9% 11%

9%

29%

7% 2% 3%

3% 5%

4%

6%

5%

7% 13% 8%

14%

23%
56

Figure 4.12, however, the industry grew by 36.2 % because of enhanced productivity. 

There is also a marked difference in petroleum and coal product manufacturing. 

Computer and electronic products represented 13 % of manufacturing in 2009 up from 

6 % in 1977 and 12 % in 2000 (not shown in Figure 4.11). Machinery was 7 % in 2009, 

down from 11 % in 1977 and 8 % in 2000 (not shown in Figure 4.11). The manufacturing 

of motor vehicles, bodies and trailers, and parts was 5 % in 2009 down from 9 % in 1977 

and 8 % in 2000 (not shown in Figure 4.11). As discussed in the next section, according 

to Figure 4.12, which contains data adjusted using the PPI by industry, the computer and 

electronic product manufacturing industry grew by 36.2 % between 2000 and 2009. 

During this period, only the petroleum and coal products industry grew faster at 41.9 %. 

Between 1986 and 2009 computer and electronic products manufacturing grew 182.5 %, 

the largest growth of all manufacturing industries shown. Petroleum and coal were the 

second largest at 101.8 %. During this same period, motor vehicle, bodies and trailers, 

and parts manufacturing declined 12.7 %; however, most of this decline occurred 

between its peak in 2003 and 2009 where it declined 42.1 %.

Figure 4.12: Selected Manufacturing Industries GDP by Industry (BEA), 1986-2009

Note: Adjusted using the PPI by subsector

4.2.2 Input-Output Accounts

Annual input-output data is available from the BEA for the years 1998 through 2009. 

Prior to 1998, the data is available for every fifth year starting in 1967. There is also data

available for the years 1947, 1958, and 1963. More detailed data is available for years 

ending in two or seven. The input-output accounts provide data to analyze inter-industry 

relationships. 

0.0

50.0

100.0

150.0

200.0

250.0

300.0

1986

1989

1992

1995

1998

2001

2004

2007

$Billion 2009

Electrical equipment, appliances,

and components

Nonmetallic mineral products

Plastics and rubber products

Primary metals

Other transportation equipment

Motor vehicles, bodies and trailers,

and parts

Computer and electronic products

Machinery

Petroleum and coal products

Fabricated metal products

Chemical products
57

BEA input-output data is provided in the form of make and use tables. Make tables show 

the production of commodities (products) by industry. Use tables show the components 

required for producing the output of each industry. There are two types of make and use 

tables: “standard” and “supplementary.” Standard tables closely follow NAICS and are

consistent with other economic accounts and industry statistics, which classify data based 

on establishment. Note that an “establishment” is a single physical location where 

business is conducted. This should not be confused with an “enterprise” such as a 

company, corporation, or institution. Establishments are classified into industries based 

on the primary activity within the NAICS code definitions. Establishments often have 

multiple activities. For example, a hotel with a restaurant has income from lodging, a 

primary activity, and from food sales, a secondary activity. An establishment is classified 

based on its primary activity. Data for an industry reflects all the products made by the 

establishments within that industry; therefore, secondary products are included. 

Supplementary make-use tables reassign secondary products to the industry in which they 

are primary products. The data in this report utilizes supplementary make-use tables.73, 74

The make-use tables are used for input-output analysis as developed by Wassily Leontief. 

Within this model, economies of scale are ignored; thus, it operates under constant 

returns to scale. The model also assumes that a sector uses inputs in fixed proportions.75

This report uses an industry-by-commodity format as outlined in Horowitz and Planting. 

This accounts for the fact that an industry may produce more than one commodity or 

product such as secondary and by-products. This calculation, however, does not take into 

account the fact that competitive imports are included in the make-use tables; therefore, 

to analyze the domestic manufacturing industry’s interindustry relationships imports must 

be removed. This is done by subtracting imports proportionally throughout the use 

matrix.

Each manufacturing sector has two impacts: there are the goods and services purchased 

for use in the specified sector and then there are the goods and services that use products 

of the specified sector. The primary measure of output in the input-output accounts is 

gross output, which is similar to shipments from the Annual Survey of Manufactures. In 

general, gross output includes the value of both intermediate product and final product 

measured using market value (revenues received) for goods and services. With much of 

the data being from the Economic Census, the basic measure used for each industry 

varies, but is often referred to as “receipts.” It is identified as shipments for mining and 

manufacturing, revenue for utilities, sales for merchant wholesale trade and retail trade, 

receipts for most services, and commissions for commodity brokerage. For the purpose of 

this report, it will simply be called output.

 

73 Over the years BEA has made improvements to its methods. This includes redefining secondary 

products. The data discussed in this section utilizes the data BEA refers to as “after redefinitions.”

74 Horowitz, Karen J. and Mark A. Planting “Concepts and Methods of the U.S. Input-Output Accounts.” 

2009. <http://www.bea.gov/papers/pdf/IOmanual_092906.pdf>

75 Miller, Ronald E. and Peter D. Blair. Input-Output Analysis: Foundations and Extensions. (New York: 

Cambridge University Press, 2009): 16.
58

As seen in Table 4.2, the total impact of computer and electronic product manufacturing 

is $457.9 billion or 1.9 % of total output. That is, if all domestic computer and electronic 

manufacturing ceased to exist, total output would be 1.9 % less. Food, beverage, and 

tobacco products have the largest impact with $1 319.7 billion or 5.3 % of total output. 

Chemical product manufacturing is the second largest and petroleum and coal products 

are the third largest. Manufacturing’s total impact on output is $5 705.2 billion or 23 % of 

total output. It is important to note that the last entry of the column labeled 

“manufacturing products used” is left blank because this value is already accounted for in 

the column labeled “products used in the manufacturing industry.” That is, the column 

labeled “B” has both the products an industry uses from other manufacturing industries as 

well as the products an industry uses from itself; thus, the sum of column “D” would 

represent the products an industry uses from itself, which is already accounted for in 

column “B.” The item that is similar to shipments from the ASM is the total industry 

output, which is $4 476 billion. Table 4.3 provides a more detailed account of products 

used by the manufacturing industry; thus, the sum of the last row of the table (excluding 

the last column labeled manufacturing products, which is blank) equals the total in the 

column labeled “non-manufacturing products used” in Table 4.2. The last column is 

exactly the same as the column labeled “manufacturing products used” in Table 4.2. As 

seen in Table 4.3, the computer and electronic products sector used $975.8 million of 

construction products, $1 487.2 million of non-manufactured materials, $14 339.5 million 

wholesale and retail trade services, $4 875.5 million in utilities, $45 426.3 million of 

professional services, $4 291.5 million of transportation and warehousing, $12 271.7 

million of other non-manufacturing, and $35 169.4 million of manufacturing products 

(excluding computer and electronic products). The green colored bars in the table 

visually compare the value of the goods and services consumed by each manufacturing 

sector. For example, the computer and electronic products sector consumed more 

professional services than any other good or service; therefore, it has the longest bar. 

Table 4.4 has similar information for manufacturing products used by other industries. As 

seen in this table, professional services used $15 542.7 million of computer and 

electronic products in 2009 and the manufacturing industry used $276 061.9 million of 

computer and electronic products (including those products purchased from the computer 

and electronic industry for itself). As seen in Table 4.5, the manufacturing industry 

impacts 16.2 % of value added with computer and electronic products impacting 1.8 %.76

It is important to note, that there are additional services that support manufactured 

products in the marketplace. That is, technology support such as software and computer 

system design services purchased directly in the market place are not accounted for in 

Tables 4.2 through 4.5 because these purchases are not related to the manufacturing 

industry. These goods and services support both domestically produced goods and 

overseas produced goods. The computer systems design and related services sector 

(NAICS 5415) produced $340 488.2 million in output associated with non-manufacturing 

 

76 The value added calculation assumes that the ratio of value added to output is constant for each subsector
59

Table 4.2: Manufacturing Industry Impact on Output, 2009

A W B X =A+B =W+X C Y D Z =A+B+C+D =W+X+Y+Z

NAICS Industry

Product Used in 

NonManufacturing 

Industries 

($million)

As a 

Percent 

of Total 

Output

Product Used 

in the 

Manufacturing 

Industry 

($millions)*

As a 

Percent 

of Total 

Output

Total Industry 

Output 

($millions)

As a 

Percent 

of Total 

Output

NonManufacturing 

Products Used 

($million)

As a 

Percent 

of Total 

Output

Manufacturing 

Products Used 

($million)**

As a 

Percent 

of Total 

Output

Total 

Impact on 

Output 

($million)

As a Percent 

of Total 

Output

321 Wood products 56 252 0.23% 22 500 0.09% 78 751 0.32% 5 690 0.02% 1 677 0.01% 86 117 0.35%

327 Nonmetallic mineral products 63 338 0.26% 28 212 0.11% 91 549 0.37% 8 548 0.03% 2 808 0.01% 102 905 0.41%

331 Primary metals 61 153 0.25% 117 747 0.47% 178 901 0.72% 9 036 0.04% 3 323 0.01% 191 260 0.77%

332 Fabricated metal products 144 349 0.58% 155 972 0.63% 300 321 1.21% 21 739 0.09% 16 342 0.07% 338 403 1.36%

333 Machinery 42 356 0.17% 213 675 0.86% 256 031 1.03% 82 030 0.33% 85 909 0.35% 423 971 1.71%

334 Computer and electronic products 63 024 0.25% 276 062 1.11% 339 086 1.37% 83 665 0.34% 35 169 0.14% 457 920 1.85%

335 Electrical equipment, appliances, and components 30 215 0.12% 71 481 0.29% 101 696 0.41% 20 821 0.08% 23 231 0.09% 145 749 0.59%

3361MV Motor vehicles, bodies and trailers, and parts 53 069 0.21% 294 474 1.19% 347 543 1.40% 104 039 0.42% 106 156 0.43% 557 738 2.25%

3364OT Other transportation equipment 48 256 0.19% 195 052 0.79% 243 308 0.98% 80 977 0.33% 53 282 0.21% 377 567 1.52%

337 Furniture and related products 13 754 0.06% 46 211 0.19% 59 966 0.24% 24 047 0.10% 18 666 0.08% 102 679 0.41%

339 Miscellaneous manufacturing 33 335 0.13% 116 073 0.47% 149 408 0.60% 44 217 0.18% 34 472 0.14% 228 096 0.92%

311FT Food and beverage and tobacco products 146 379 0.59% 629 686 2.54% 776 065 3.13% 431 574 1.74% 112 025 0.45% 1 319 664 5.32%

313TT Textile mills and textile product mills 8 771 0.04% 36 306 0.15% 45 077 0.18% 10 497 0.04% 10 288 0.04% 65 863 0.27%

315AL Apparel and leather and allied products 1 177 0.00% 15 818 0.06% 16 995 0.07% 4 295 0.02% 3 143 0.01% 24 433 0.10%

322 Paper products 68 506 0.28% 89 693 0.36% 158 200 0.64% 20 875 0.08% 10 808 0.04% 189 882 0.77%

323 Printing and related support activities 76 632 0.31% 15 374 0.06% 92 006 0.37% 4 929 0.02% 2 728 0.01% 99 663 0.40%

324 Petroleum and coal products 219 928 0.89% 253 656 1.02% 473 583 1.91% 95 416 0.38% 10 440 0.04% 579 439 2.34%

325 Chemical products 154 278 0.62% 446 413 1.80% 600 691 2.42% 156 909 0.63% 68 586 0.28% 826 185 3.33%

326 Plastics and rubber products 75 908 0.31% 91 754 0.37% 167 662 0.68% 19 061 0.08% 21 391 0.09% 208 113 0.84%

32-33 TOTAL Manufacturing 1 360 680 5.49% 3 116 159 12.56% 4 476 839 18.05% 1 228 364 4.95% - - 5 705 203 23.00%

* Including the specified industry

** Excluding specified industry
60

Table 4.3: Products Used by Manufacturing Subsectors ($millions 2009)

Note: For the purposes of this Table, construction is NAICS 23; non-manufactured materials is 111CA, 113FF, 211, 212, and 213; wholesale and retail trade is 

42 and44RT; utilities is 22, 513, and 562; professional services is 514, 521CI, 523, 524, 525, 531, 532RL, 5411, 5415, 5412OP, 55, 561, 61, 621, and 622HO; 

transportation and warehousing is 481, 482, 483, 484, 485, 486, 487OS, and 493; and other includes 511, 512, 624, 711AS, 713, 721, 722, 81, and government 

entities

Note: The green bars represent a visual comparison within each subsector (e.g., wood products) between categories (e.g., construction). Higher values have 

longer bars (e.g., the wood products sector uses more professional services than any other category; therefore, it has the longest green bar).

NAICS Industry Construction

NonManufactured 

Materials

Wholesale and 

Retail Trade Utilities

Professional 

Services

Transportation 

and 

Warehousing

Other NonManufacturing

Manufacturing 

Products 

($million)*

321 Wood products 122.5 1 188.5 786.1 444.1 2 043.2 597.7 507.4 1 676.7

327 Nonmetallic mineral products 208.8 1 316.9 681.0 967.1 3 311.3 1 310.1 752.5 2 807.7

331 Primary metals 280.4 1 338.4 1 010.6 1 041.4 3 398.3 1 173.9 793.1 3 323.0

332 Fabricated metal products 498.2 1 039.2 2 607.6 2 049.2 11 609.7 1 910.8 2 024.7 16 342.3

333 Machinery 1 586.7 3 039.2 14 507.9 6 342.7 42 695.2 6 790.0 7 068.6 85 909.1

334 Computer and electronic products 975.8 1 487.2 14 339.5 4 875.5 45 423.3 4 291.5 12 271.7 35 169.4

335 Electrical equipment, appliances, and components 420.6 1 157.7 4 182.1 1 735.0 9 746.0 1 848.1 1 732.0 23 231.2

3361MV Motor vehicles, bodies and trailers, and parts 1 944.2 5 466.4 21 291.1 8 088.4 49 360.4 9 719.6 8 169.0 106 156.4

3364OT Other transportation equipment 1 129.8 2 011.2 9 136.1 5 182.1 51 006.0 5 491.3 7 020.1 53 281.9

337 Furniture and related products 510.8 1 169.2 3 800.1 2 032.8 11 828.5 2 499.1 2 206.2 18 666.1

339 Miscellaneous manufacturing 762.0 1 591.9 6 236.3 3 442.0 24 485.2 3 746.0 3 953.1 34 472.2

311FT Food and beverage and tobacco products 5 875.5 158 251.2 54 359.0 25 882.6 131 437.5 33 487.8 22 280.5 112 025.2

313TT Textile mills and textile product mills 207.0 1 053.8 1 921.6 1 173.8 4 211.5 1 048.2 881.6 10 288.0

315AL Apparel and leather and allied products 55.2 248.1 859.1 326.2 2 134.8 361.5 309.8 3 143.3

322 Paper products 590.3 1 877.4 3 218.1 2 877.1 7 906.7 2 379.7 2 025.4 10 808.1

323 Printing and related support activities 113.4 146.1 535.7 453.9 2 726.3 405.6 547.9 2 727.6

324 Petroleum and coal products 3 229.5 63 007.6 7 604.4 2 593.6 13 072.8 3 864.6 2 043.5 10 439.9

325 Chemical products 3 281.5 18 048.1 21 600.3 15 435.9 74 999.9 11 794.7 11 748.1 68 585.6

326 Plastics and rubber products 466.9 1 284.1 2 693.2 2 080.2 9 033.0 1 688.7 1 814.8 21 390.6

32-33 TOTAL Manufacturing 22 259.1 264 722.3 171 369.9 87 023.7 500 429.6 94 408.8 88 150.1 -

* Excluding specified industry
61

Table 4.4: Manufacturing Products Used by Other Industries ($million 2009)

Note: For the purposes of this Table, construction is NAICS 23; non-manufactured materials is 111CA, 113FF, 211, 212, and 213; wholesale and retail trade is 

42 and44RT; utilities is 22, 513, and 562; professional services is 514, 521CI, 523, 524, 525, 531, 532RL, 5411, 5415, 5412OP, 55, 561, 61, 621, and 622HO; 

transportation and warehousing is 481, 482, 483, 484, 485, 486, 487OS, and 493; and other includes 511, 512, 624, 711AS, 713, 721, 722, 81, and government 

entities

Note: The green bars represent a visual comparison within each subsector (e.g., wood products) between categories (e.g., construction). Higher values have 

longer bars.

NAICS Industry Construction

NonManufactured 

Materials

Wholesale and 

Retail Trade Utilities

Professional 

Services

Transportation 

and 

Warehousing

Other NonManufacturing

Manufacturing 

Products 

($million)*

321 Wood products 29 210.2 712.9 2 531.5 1 168.3 9 409.5 598.1 12 621.0 22 499.7

327 Nonmetallic mineral products 38 067.5 1 623.9 1 664.0 1 881.7 7 431.3 566.8 12 102.5 28 211.7

331 Primary metals 21 009.6 4 514.7 2 433.8 2 268.7 9 720.4 1 846.7 19 359.4 117 747.5

332 Fabricated metal products 60 866.6 4 055.3 5 733.1 6 021.2 20 695.6 4 858.9 42 118.8 155 971.9

333 Machinery 14 802.6 2 620.7 1 710.9 1 655.4 7 191.6 854.5 13 520.2 213 675.3

334 Computer and electronic products 5 109.1 555.1 3 827.8 4 208.0 15 542.7 725.0 33 056.5 276 061.9

335 Electrical equipment, appliances, and components 13 305.4 430.8 1 082.8 1 536.9 4 457.1 532.5 8 869.7 71 480.9

3361MV Motor vehicles, bodies and trailers, and parts 6 248.8 1 013.4 4 751.4 1 145.4 7 153.5 3 070.5 29 685.6 294 474.5

3364OT Other transportation equipment 861.4 170.0 330.7 266.7 1 012.1 3 310.0 42 305.6 195 051.6

337 Furniture and related products 6 605.7 66.3 794.5 267.9 3 560.8 81.0 2 377.8 46 211.5

339 Miscellaneous manufacturing 1 651.1 373.0 1 218.9 472.8 20 969.5 166.9 8 482.3 116 072.9

311FT Food and beverage and tobacco products 1 476.9 12 171.4 2 104.0 796.3 33 705.7 507.3 95 617.4 629 685.9

313TT Textile mills and textile product mills 1 616.6 199.5 1 897.3 139.8 1 912.8 123.0 2 882.2 36 306.0

315AL Apparel and leather and allied products 46.3 7.3 146.3 16.6 192.7 6.8 760.7 15 818.2

322 Paper products 6 729.4 1 617.9 5 888.4 1 374.0 17 759.2 780.9 34 356.5 89 693.4

323 Printing and related support activities 3 082.7 476.7 8 020.2 1 521.4 24 577.4 549.0 38 404.7 15 374.1

324 Petroleum and coal products 38 566.2 8 784.7 11 317.5 7 009.9 35 770.8 37 255.0 81 223.5 253 655.9

325 Chemical products 19 610.3 11 431.9 6 331.4 2 855.7 61 919.7 2 377.7 49 751.6 446 412.8

326 Plastics and rubber products 17 566.6 1 888.1 7 073.3 2 228.3 19 603.3 1 535.0 26 013.5 91 753.7

32-33 TOTAL Manufacturing 286 433.1 52 713.5 68 857.7 36 835.1 302 585.6 59 745.7 553 509.4 3 116 159.2

* Including specified industry
62

Table 4.5: Manufacturing Industry Impact on Value Added, 2009

A W B X =A+B =W+X C Y D Z =A+B+C+D =W+X+Y+Z

NAICS Industry

Product Used in 

NonManufacturing 

Industries 

($million)

As a 

Percent 

of Total 

Value 

Added

Product Used 

in the 

Manufacturing 

Industry 

($millions)*

As a 

Percent 

of Total 

Value 

Added

Total Industry 

Value Added 

($millions)

As a 

Percent 

of Total 

Value 

Added

NonManufacturing 

Products Used 

($million)

As a 

Percent 

of Total 

Value 

Added

Manufacturing 

Products Used 

($million)**

As a 

Percent 

of Total 

Value 

Added

Total 

Impact on 

Value 

Added 

($million)

As a Percent 

of Total 

Value Added

321 Wood products 14 581 0.10% 5 832 0.04% 20 413 0.14% 3 661 0.03% 594 0.00% 24 668 0.17%

327 Nonmetallic mineral products 25 771 0.18% 11 479 0.08% 37 250 0.26% 5 303 0.04% 965 0.01% 43 517 0.31%

331 Primary metals 14 522 0.10% 27 961 0.20% 42 483 0.30% 5 618 0.04% 1 264 0.01% 49 365 0.35%

332 Fabricated metal products 56 910 0.40% 61 493 0.44% 118 403 0.84% 13 646 0.10% 4 872 0.03% 136 921 0.97%

333 Machinery 17 685 0.13% 89 217 0.63% 106 902 0.76% 52 410 0.37% 30 103 0.21% 189 415 1.34%

334 Computer and electronic products 36 187 0.26% 158 506 1.12% 194 693 1.38% 53 354 0.38% 12 125 0.09% 260 172 1.84%

335 Electrical equipment, appliances, and components 14 811 0.10% 35 039 0.25% 49 850 0.35% 13 408 0.09% 7 875 0.06% 71 132 0.50%

3361MV Motor vehicles, bodies and trailers, and parts 11 747 0.08% 65 183 0.46% 76 930 0.54% 66 964 0.47% 37 541 0.27% 181 435 1.29%

3364OT Other transportation equipment 16 966 0.12% 68 576 0.49% 85 542 0.61% 51 314 0.36% 21 174 0.15% 158 030 1.12%

337 Furniture and related products 5 321 0.04% 17 878 0.13% 23 199 0.16% 15 246 0.11% 6 084 0.04% 44 528 0.32%

339 Miscellaneous manufacturing 17 557 0.12% 61 135 0.43% 78 692 0.56% 27 994 0.20% 12 089 0.09% 118 775 0.84%

311FT Food and beverage and tobacco products 39 048 0.28% 167 973 1.19% 207 021 1.47% 235 885 1.67% 37 652 0.27% 480 558 3.40%

313TT Textile mills and textile product mills 3 303 0.02% 13 671 0.10% 16 974 0.12% 6 617 0.05% 3 678 0.03% 27 270 0.19%

315AL Apparel and leather and allied products 713 0.01% 9 587 0.07% 10 300 0.07% 2 752 0.02% 1 089 0.01% 14 140 0.10%

322 Paper products 24 073 0.17% 31 519 0.22% 55 592 0.39% 13 323 0.09% 3 642 0.03% 72 557 0.51%

323 Printing and related support activities 27 730 0.20% 5 563 0.04% 33 293 0.24% 3 119 0.02% 959 0.01% 37 372 0.26%

324 Petroleum and coal products 54 454 0.39% 62 805 0.44% 117 259 0.83% 68 769 0.49% 3 658 0.03% 189 686 1.34%

325 Chemical products 51 712 0.37% 149 633 1.06% 201 345 1.43% 100 991 0.72% 21 659 0.15% 323 996 2.29%

326 Plastics and rubber products 24 667 0.17% 29 817 0.21% 54 484 0.39% 12 154 0.09% 7 380 0.05% 74 019 0.52%

32-33 TOTAL Manufacturing 457 758 3.24% 1 072 865 7.60% 1 530 624 10.84% 752 528 5.33% - - 2 283 152 16.17%

* Including the specified industry

** Excluding specified industry
63

activity while the software publishing sector (NAICS 511200) produced $128 380.1 

million.77

4.3 Bureau of Labor Statistics: Labor and Productivity

The Bureau of Labor Statistics (BLS), an agency within the Department of Labor, 

measures labor market activity, working conditions, and price changes in the economy. 

There are two measures provided by the BLS that measure productivity: labor 

productivity and multifactor productivity. Labor productivity relates output to labor hours 

used to produce output while multifactor productivity relates output to a combined set of 

inputs such as labor and capital. The BLS also tracks employment through two surveys: 

Current Employment Statistics (CES) program and the Current Population Survey (CPS). 

The CES surveys approximately 140 000 businesses and government agencies to provide 

data on employment, hours, and earnings. The CPS is a monthly survey of households 

conducted by the Bureau of the Census.78

Productivity: Manufacturing labor productivity has increased significantly in recent 

decades. As seen in Figure 4.13, labor productivity in manufacturing increased 105.1 % 

between 1987 and 2008 while private non-farm business increased 64.9 %; thus, 

manufacturing labor productivity is increasing faster than the whole of the U.S. economy. 

The industry with the largest productivity gains is the computer and electronics sector 

(NAICS 334) which increased 1009.3 % (not shown), more than 10 times larger than any 

other manufacturing subsector shown in Figure 4.13. Between 1987 and 2009, 

multifactor productivity (not shown) increased 26.3 % for all manufacturing and 661.2 % 

Figure 4.13: Output per Unit of Labor (aggregate percent increase of BLS Index)

 

77 Software publishing was estimated as the 2002 ratio of the value of software publishing industry output 

(NAICS 511200) to the value of the publishing industry output (NAICS 511) multiplied by the value of the 

publishing industry output for non-manufacturing industries in 2009. 

78 Bureau of Labor Statistics. “BLS Productivity Statistics.” <http://www.bls.gov/bls/productivity.htm>

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

120.0%

1987

1990

1993

1996

1999

2002

2005

2008

Nonmetallic Mineral Products (NAICS

327)

Fabricated Metal Products (NAICS 332)

Chemical Products (NAICS 325)

Private Non-Farm Business

Plastics and Rubber Products (NAICS

326)

Primary Metal Products (NAICS 331)

Electrical Equipment, Appliances, and

Components (NAICS 335)

Petroleum and Coal Products (NAICS

324)

Machinery (NAICS 333)

Transportation Equipment (NAICS 336)

Manufacturing
64

for computer and electronic products. During the same period machinery (NAICS 333); 

electrical equipment, appliances, and components (NAICS 335); and transportation 

equipment (NAICS 336) declined 7.2 %, 18.2 %, and 3.3 % respectively. It is important 

to note that the source of productivity gains in manufacturing have been questioned 

somewhat. It has been suggested that the source of at least some of these gains are due to 

outsourcing.79

Employment: Employment levels for manufacturing have fluctuated somewhat in recent 

decades and have recently declined significantly. As seen in Figure 4.14, manufacturing 

as a percent of total non-farm employment has had a downward trend since 1919 with the 

exception of a period during World War II when the U.S. was manufacturing military 

supplies. According to NAICS CES data, 15.0 million workers were employed in 

manufacturing in 1961. Employment peaked in 1979 to 19.4 million and declined 41 % to 

11.5 million in 2010, as seen in Figure 4.15. Many of the subsectors shown in the figure

trend upwards until some point between the mid-70’s and mid-80’s where they plateau

somewhat or trend downwards. According to CPS data, there were 14.1 million 

employed persons in the manufacturing industry in 2010. Of these, 97 % is private 

industry workers, 2 % is self employed, and less than one percent is government and 

unpaid family workers. The 2010 estimate of the number of employees is down 17 % 

from 16.9 million in 2003.

Wages: Wages in the U.S. manufacturing industry had a general upward trend from 1919 

until the early 70’s where they began to plateau or even trend downwards, as seen in 

Figure 4.16. This trend however, is similar to the trend for the wages for all those in 

Figure 4.14: Manufacturing Employment as a Percent of Total Non-Farm Employment (CES)

 

79 Houseman, Susan. “Outsourcing, Offshoring, and Productivity Measurement in U.S. Manufacturing.” 

Upjohn Institute Staff Working Paper No. 06-130. June 2006. 

<http://www.upjohninst.org/publications/wp/06-130.pdf>

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

19191923192719311935193919431947195119551959196319671971197519791983198719911995199920032007

Manufacturing (NAICS 31-33)

Manufacturing (SIC 20-39)
65

Figure 4.15: Employment in Manufacturing and Select Subsectors, 1919-2010 (Current Employment 

Survey)

Figure 4.16: Wages in Manufacturing and Select Subsectors, 1919-2010 (Current Employment 

Statistics)

* 2003 to 2010 is NAICS 31-33

0

5000

10000

15000

20000

25000

0

500

1000

1500

2000

2500

3000

3500

4000

19191926193319401947195419611968197519821989199620032010

Employees (1000s)Employees (1000s)

Chemicals and allied products

(SIC 28)

Petroleum and coal products

(SIC 29)

Primary metal Industries (SIC

33)

Fabricated metal products

(SIC 34)

Industrial machinery and

equipment (SIC 35)

Computer and Office

Equipment (SIC 357)

Electronic and other electrical

equipment (SIC 36)

Transportation equipment

(SIC 37)

Instruments and related

products (SIC 38)

Manufacturing (SIC 20-39)

Manufacturing (NAICS 31-33)

0

5

10

15

20

25

30

35

1919192419291934193919441949195419591964196919741979198419891994199920042009

Average Hourly Wage ($2009)

Manufacturing (SIC 20-39)*

Chemicals and allied products

(SIC 28)

Petroleum and coal products

(SIC 29)

Primary metal Industries (SIC

33)

Fabricated metal products (SIC

34)

Industrial machinery and

equipment (SIC 35)

Computer and Office

Equipment (SIC 357)

Electronic and other electrical

equipment (SIC 36)

Transportation equipment

(SIC 37)

Instruments and related

products (SIC 38)

Total Private (SIC)
66

private industry. The average hourly earnings for all private workers using the NAICS 

format from the CES was $22.21 in 2009 while it was $23.04 for manufacturing workers.

4.4 National Science Foundation: Research and Development

The National Science Foundation (NSF) is an independent federal agency created by 

Congress in 1950. As stated by the NSF, it was created “to promote the progress of 

science; to advance the national health, prosperity, and welfare; [and] to secure the 

national defense...” The agency collects data on research and development expenditures 

and provides them through its National Center for Science and Engineering Statistics 

(NCSES).80 The data is broken into categories by funding sources, industry, and by type 

of research. Since federally funded research represents less than 10 % of total funding, 

this report will focus on non-federally funded expenditures, which reflects trends in the 

private industry. Total federal research funding, however, is briefly discussed. It is 

important to note that the funds for research and development discussed in this section, 

including federal funds, is activity performed within company owned or company 

operated facilities.

As mentioned previously, significant concern has been expressed in regards to U.S. 

research and development expenditures compared to those abroad. This concern is 

primarily in regards to its proportion of global research and development expenditures;

81

however, a decline of the proportion of these activities is not unexpected and is not by 

itself considered a decline in the U.S. manufacturing industry. A greater concern is its 

nominal and real performance relative to its population and/or resources. It is in this 

context that this report examines research and development.

Research and development expenditures in the manufacturing industry accounted for 

69.5 % of the total for the U.S. Expenditures have increased significantly for the 

chemical industry as seen in Figure 4.17. Between 2000 and 2006 it increased 89.7 %. 

Pharmaceuticals and medicines, which increased 159.2 % during the same period (see 

Figure 4.18), represented 84.2 % of chemical research in 2006. During the 2000 to 2006

period, computer and electronic product research expenditures decreased 7.4 %; however, 

a number of this industry’s subsectors increased significantly: semiconductor and other 

electronic component research was up 23.8 %, computers and peripheral equipment were

up 20.6 %, and other computer and electronic products were up 199.0 % (see Figure 

4.18). As illustrated in Figure 4.17, machinery and transportation equipment research 

increased 27.3 % and 11.9 % respectively.

Approximately 39 % of total research and development expenditures in 1953 were 

funded by the Federal government with the remainder being from company and other 

sources, as illustrated in Figure 4.19. This percentage did not drop below 30 % until 1989 

where it began a downward trend until 2002 where it represented 8.5 %. Between 2002 

and 2007 it increased to 9.9 %. Overall, total expenditures have had a general upward 

 

80 National Science Foundation. “Business and Industrial R&D.” <http://www.nsf.gov/statistics/industry/>

81 Tassey Gregory. “Rationales and Mechanisms for Revitalizing U.S. Manufacturing R&D Strategies.” 

Journal of Technology Transfer. 35 (2010): 283-333.
67

trend between 1953 and 2007 with the exception of a few years. Approximately 4 % of 

nonfederal research expenditures was basic research, 20 % applied, and 76 % was 

development in 2007. This has changed only slightly since 1953 where it was 6 %, 20 %, 

and 74 % respectively. Federal funding for defense related research and development 

represented 16.2 % of total 2007 research and development (not shown). Space, civilian, 

and nonfederal related expenditures are 1.4 %, 9.3 %, and 73.9 % respectively (not 

shown).

Figure 4.17: Company and Other Research and Development by Industry

0

10 000

20 000

30 000

40 000

50 000

60 000

$ Millions 2009

Primary metals

Nonmetallic mineral products

Petroleum and coal products

Fabricated metal products

Electrical equipment, appliances, and

components

Plastics and rubber products

Miscellaneous manufacturing

Food, beverages, textiles, apparel,

paper, and printing

Machinery

Transportation equipment

Chemicals

Computer and electronic products

0% 1% 1% 1% 1%

2% 3%

5%

6%

19%

30%

31%

2007 Research and 

Development
68

Figure 4.18: Company and Other Research and Development by Industry (subsectors of the chemical 

industry and computer and electronic industry)

NOTE: Adjusted using the CPI

Figure 4.19: Research and Development by Source of Funds

0

10 000

20 000

30 000

40 000

50 000

$ Millions 2009

Other computer and electronic products

Resin, synthetic rubber, fibers, and

filament

Basic chemicals

Other chemicals

Computers and peripheral equipment

Navigational, measuring, electromedical,

and control instruments

Communications equipment

Semiconductor and other electronic

components

Pharmaceuticals and medicines

0

50 000

100 000

150 000

200 000

250 000

300 000

1953195519571959196119631965196719691971197319751977197919811983198519871989199119931995199719992001200320052007

$ Millions 2009

Company and Other

Federal

4% 20%

76%

2007 R&D by Type 

(nonfederal)

Basic

Applied

Development

10%

34% 56%

2007 R&D by Type 

(Federal)
69

5 Characterizing the U.S. Manufacturing Industry

5.1 Production

According to UNSD data, U.S. manufacturing growth lags behind that of many countries 

and is growing slower than the whole of the U.S. economy. Compound annual growth is 

below the 20

th percentile of 180 nations. While manufacturing value added is larger in the

U.S. than in any other country, U.S. manufacturing per capita has lagged slightly behind 

some industrialized nations, such as Germany and Japan. Out of 199 countries, at least 20 

other nations have a higher manufacturing value added per capita than the U.S. in 2008, 

according to UNSD data. Manufacturing as a percent of total Gross Domestic Product 

(GDP) has declined in the U.S. as it has declined in many industrialized nations.

Among all OECD countries for which data is available in 2009, the U.S. ranks above the 

70th percentile in value added per capita (see Table 3.4) in food, apparel, wood product, 

and printing; refined petroleum products and nuclear fuel; chemicals; office, accounting, 

and computing machinery; radio, television and communications equipment; medical, 

precision, and optical instruments; transport equipment; and other manufacturing. That is, 

in per capita terms the U.S. produces more than at least 70 % of those ranked. Among 

those OECD countries for which data is available, the U.S. is above the 70th percentile in 

terms of the gross operating surplus per expenditure dollar for at least four sectors of 

manufacturing in 2009: refined petroleum products and nuclear fuel; chemicals; 

machinery and equipment; electrical machinery and apparatus; and total manufacturing. 

Manufacturing’s share of employment has declined for all OECD countries including the 

U.S. 

According to OECD input-output data for 39 countries, the U.S. has the largest value 

added in the mid-2000’s for all manufacturing subsectors except basic metals; office, 

accounting, and computing machinery; and electrical machinery and apparatus as seen in 

the rankings in Table 3.9. In terms of value added per capita, the U.S. ranks 4th in office, 

accounting, and computing machinery, 11th for all manufacturing, and does not rank first 

for any subsector in terms of value added per capita. According to these data, the whole 

of the U.S. manufacturing industry impacts $6 446 billion or 27.9 % of total output (see 

Table 3.11), slightly more than is estimated using BEA data. This percentage is lower 

than other countries such as China, Germany, India, and Japan which have impacts of 

62.1 %, 44.9 %, 45.3 %, and 41.2 % respectively.

In 2009, the total value of shipments in manufacturing was $4.44 trillion, according to the 

ASM. Value added for all manufacturing was $1 978.2 billion in 2009. Approximately 

9.8 % of this value is computer and electronic product manufacturing as illustrated in 

Table 4.1. This sector increased 15.5 % from $214.3 billion in 1997 to $247.6 billion in 

2000. During the early 2000’s recession it declined to a low of $182.9 billion in 2002, but 

increased until the late 2000’s recession as illustrated in Figure 4.1. Semiconductor and 

other electronic components manufacturing (NAICS 3344) is 3.0 % of the manufacturing 

industry and has a net income per expenditure dollar ratio of 0.173. During the 1997 to 
70

2009 period, employment declined for all sectors shown in Figure 4.1: petroleum and 

coal products declined 6 %; chemicals 18 %; plastics and rubber 34 %; nonmetallic 

mineral products 28 %; primary metals 41 %; fabricated metal 26 %; machinery 32 %; 

computer and electronic products 46 %; electrical equipment, appliance, and components 

41 %; and transportation 33 %. Each subsector’s proportion of employment and value 

added is shown in Figure 4.3. The net income for all manufacturing in 2009 was 

$659.9 billion.

The Manufacturer’s Shipments, Inventories, and Orders Survey indicates that computer 

and electronic product manufacturing represents 8 % of manufacturing shipments down 

from 10 % in 1992. This decline is likely due to changes in the price of computer and 

electronic product manufacturing and not due to a decline in the volume of physical 

production. This industry grew by 47 % between 1992 and 2009, faster than any other 

industry shown in Figure 4.7.

BEA GDP by industry shows manufacturing as 8 % of U.S. growth between 1947 and 

2009 while the largest growth sector was the finance, insurance, real estate, rental, and 

leasing sector with real estate representing the majority of this growth. GDP grew 501 % 

between 1947 and 2009 while manufacturing grew 164 %. The slower growth in 

manufacturing has resulted in a downward trend in manufacturing’s share of GDP. This 

trend seems to pervade as far back as 1947 when data was first collected. This sentiment 

is supported by manufacturing’s share of total employment, which also has a pervading 

downward trend with the exception of the World War II era (see Figure 4.14). As seen in 

Table 4.2, the total impact of computer and electronic product manufacturing is $457.9 

billion or 1.9 % of total output. Food, beverage, and tobacco products is the largest with 

$1 319.7 billion or 5.3 % of total output. Chemical products is the second largest and 

petroleum and coal products is the third largest. Other industries such as machinery; 

electrical equipment, appliances, and components; motor vehicles, bodies, trailers, and 

parts; and other transportation represented 1.7 %, 0.6 %, 2.3 %, and 1.5 % respectively. 

Manufacturing’s total impact on output is $5 705.2 billion or 23 % of total output.

Manufacturing labor productivity has increased significantly in recent decades, as 

indicated by BLS data. As seen in Figure 4.13, labor productivity in manufacturing 

increased 105.1 % between 1987 and 2008 while private non-farm business increased 

64.9 %; thus, manufacturing labor productivity is increasing faster than the whole of the 

U.S. economy. Employment levels for manufacturing have fluctuated somewhat in recent 

decades and have recently declined significantly. According to CES data, 15.0 million 

workers were employed in manufacturing in 1961. Employment peaked in 1979 to 

19.4 million and declined 41 % to 11.5 million in 2010. Wages in the U.S. manufacturing 

industry had a general upward trend from 1919 until the early 70’s where they began to 

plateau or even trend downwards, as seen in Figure 4.16.

5.2 Research, Development, and Technology

Among all OECD countries for which data is available, the U.S. ranks above the 85th 

percentile during the 2001 to 2008 period for total research and development 
71

expenditures for all subsectors, as seen in Table 3.13. From 2001 through 2007, it was 

above the 90th percentile for all subsectors of manufacturing and above the 95th

percentile for total manufacturing. In terms of per capita research and development 

expenditures, 2007 U.S. values rank above the 70th percentile for a number of subsectors

and total manufacturing (see Table 3.14). According to OECD patent data, as seen in 

Table 3.15, between 1999 and 2007 the U.S. has ranked above the 90th percentile in terms 

of total number of patents and above the 80th percentile in terms of patents per capita. 

During that same period, U.S. patents represented between 30 % and 41 % of total 

patents worldwide.

As indicated by World Bank data, the U.S. ranks above the 90th percentile for 2009 patent 

applications (resident and nonresident), patent applications per capita (resident and 

nonresident), and royalty license fees (payments and receipts). Researchers per million 

people were above the 85th percentile in 2006, the latest data available. Scientific and 

technical journal articles authored by U.S. residents were above the 95th percentile and 

articles per capita were above the 90th percentile in 2007, the latest available data.

Research and development expenditures as a percent of GDP was above the 85th

percentile in 2008 and above the 90th percentile in 2007. The Global Competitiveness 

Index ranked the U.S. as 4th in innovation and 17th in technological readiness among 139 

countries. The IMD World Competitiveness Yearbook ranks the U.S. as 1st for scientific 

infrastructure and 2nd for technological infrastructure out of 59 countries. The 2003 

Competitive Industrial Performance Index puts the U.S. above the 90th percentile for its 

share of medium- and high-tech value added as a percent of total manufacturing value 

added; however, it puts the U.S. just above the 55th percentile for its share of 

manufacturing value added as a percent of total GDP (see Table 3.17).

Between 1953 and 2007 total research and development expenditures has increased 

1031 %, according to NSF data; however, during the 2000 to 2007 period it only

increased 11 %. During the 2000 to 2006 period, computer and electronic product 

research expenditures decreased 7.4 %; however, a number of this industry’s subsectors 

increased significantly: semiconductor and other electronic component research was up 

23.8 %, computers and peripheral equipment were up 20.6 %, and other computer and 

electronic products were up 199.0 % (see Figure 4.18). As illustrated in Figure 4.17,

machinery and transportation equipment research increased 27.3 % and 11.9 % 

respectively. Overall, total expenditures have had a general upward trend between 1953 

and 2007 with the exception of a few years.

5.3 Stakeholder’s Perspective

Owners and Finance Services: The owners of U.S. manufacturing firms invest land, 

capital goods, and financial capital with the expectation of receiving a profit from the 

sales of manufactured goods. The primary variable available to examine and compare the 

returns for owners and financiers internationally is gross operating surplus per dollar of 

expenditure. Gross operating surplus is gross output less a subset of costs (i.e., 

intermediate expenditures, compensation, and taxes less subsidies) and does not take into 

account the depreciation of capital; therefore, it does not fully represent a return on 
72

investment. However, it is the best variable available. OECD data for 2004 through 2009 

put the U.S. manufacturing industry as a whole above the 75th percentile for gross 

operating surplus per dollar of expenditure (see Table 3.5). This data also shows that the 

2005 U.S. employer enterprise birth rate (number of new enterprises divided by the 

number of existing enterprises) is less than the death rate; thus, more businesses were 

eliminated from manufacturing than were created (see Table 3.8). According to OECD 

input-output data for the mid-2000’s, the U.S. ranks 14th out of 39 countries or just above 

the 60th percentile in terms of gross operating surplus per dollar of expenditure. The 

office, accounting and computing machinery subsector ranked 9th or just above the 75th

percentile. 

The Annual Survey of Manufactures provides an opportunity to examine the net income

(also known as net profit or simply profit) of the U.S. manufacturing industry. Net 

income is different from gross operating surplus in that it accounts for depreciation of 

assets or capital. In 2009, the total net income from the manufacturing industry in 2009 

was $659.9 billion. Approximately 32.3 % of the net income was from the production of 

food, beverages, textiles, apparel, paper, and printing (NAICS 311-323). Another 27.5 % 

is from chemical manufacturing while computer and electronic product manufacturing 

represented 7.8 % as calculated from the data in Table 4.1. Net income represented 

14.9 % of the total value of shipments. The net income per expenditure dollar was 0.18

for the whole of manufacturing while computer and electronic product manufacturing 

was slightly higher at 0.19. Stated another way, the return on investment for 

manufacturing is 18 % while computer and electronic product manufacturing was 19 %. 

Even with the highest costs for materials, buildings, and machinery, the return on 

investment for semiconductor and other electronic component manufacturing was 17 % 

(see Appendix C).

Employees: Employees exchange their time for compensation or income. The 

manufacturing industry employed 12.5 million people or 4.2 % of the population in the 

U.S. according to 2006 UNIDO data. Canada, China, Germany, India, Japan, Mexico, 

and the UK employ 1.9 million (6 %), 72.3 million (6 %), 6.9 million (8.4 %), 8.8 million 

(0.8 %), 7.5 million (5.9 %), 4.3 million (4.0 %), and 3.1 million (5.2 %) respectively. In 

the U.S., approximately 101 thousand employees work in the office, accounting, and 

computing machinery sector. The wages for manufacturing workers is $47.2 thousand 

annually in the U.S. while Canada, China, Germany, India, Japan, Mexico, and the UK 

are $30.8 thousand, $2.9 thousand, $47.7 thousand, $1.8 thousand, $30.5 thousand, $4.8 

thousand, and $41.9 thousand respectively. OECD STAN data puts U.S. manufacturing 

wages above the 90

th percentile between 2001 and 2008 with its subsectors mostly 

ranking above the 80th percentile. Manufacturing’s share of total employment has 

declined in the U.S. as it has for many nations. 

According to the Annual Survey of Manufactures there were 11.1 million manufacturing 

employees in 2009 with 908 thousand or 8 % being in the computer and electronic 

product manufacturing sector. The average compensation for the industry as a whole was 

$62.9 thousand annually with the computer and electronic product sector being 
73

$84.5 thousand. The 294 thousand individuals working in the semiconductor and related 

device sector made $71.9 thousand annually. 

Resellers, Transportation and Warehousing, Industry Suppliers, and Professional 

Services: Companies and organizations provide products and services to the 

manufacturing industry in exchange for compensation that results in a profit. Tracking 

these profits is difficult since there does not exist readily available data on the profit 

gained through domestic manufacturing alone; therefore, this report has largely focused 

on the purchases of non-manufacturing products and services rather than the profit gained 

from the purchases. According to OECD input-output data, electronics manufacturing 

(ISIC 30-32), machinery manufacturing (ISIC 29, 33-35), and other manufacturing (ISIC 

15-28, 36-37) used $115 billion, $393 billion, and $1000 billion of non-manufactured 

products and services for a total of $1508 billion or 6.5 % of total output. The total 

impact of the manufacturing industry is $6446 billion or 27.9 % of output. The total 

impact of the manufacturing industry in other nations such as Australia, Canada, China, 

Germany, India, Japan, Mexico and the UK is 24.7 %, 33.8 %, 62.1 %, 44.9 %, 45.3 %, 

41.2 %, 41.8 %, and 24.8 % of total output respectively. 

According to BEA data, the manufacturing industry uses $1228 billion of nonmanufactured goods and services and impacts 23.0 % of total output or $5705 billion. 

Computer and electronic products impacts 1.9 % of output. The whole of the 

manufacturing industry uses $22.3 billion of construction products, $264.7 billion of nonmanufactured materials, $171.4 billion of wholesale and retail trade, $87.0 billion of 

utilities, $500.4 billion of professional services, $94.4 billion of transportation and 

warehousing, and $88.2 billion of other non-manufactured products and services. 

Consumers: Data on the utility that consumers gain by purchasing domestically produced 

manufacturing products is not readily available. Additional research is needed to gain 

further knowledge in this area. 

Standards and Codes Organizations, Public Vested Interests, and Professional Societies: 

There are many organizations and individuals that have interests in the economic success 

of the manufacturing industry. This interest hinges on the primary stakeholders (owners, 

finance services, and employees), the technology produced, as well as the size of the 

industry. The primary stakeholders were discussed above in both the terms of domestic 

and international data. Assessing the technology produced by the industry must be 

measured in an indirect manner using research and development expenditure data, patent 

data, and journal publication data as there is not a direct measurement available. 

According to OECD STAN data, 2006 research and development expenditures in the 

U.S. amounted to $172.7 billion with $1.5 billion being in office, accounting, and 

computing machinery. The U.S. expenditure is often above the 90th percentile while 

expenditure per capita is commonly above the 80th percentile. 

Using the OECD Patent Database for 1999 through 2007, the U.S. accounts for more than 

30 % of the total number of patents registered while ranking above the 90th percentile in 

the number of patents and above the 80th percentile in the number of patents per capita.
74

Using World Bank data for 2000 through 2009, the U.S. ranks above the 90th percentile 

in the number of patent applications per capita for residents and above the 80th percentile 

for nonresidents. Research and development expenditures as a percent of GDP ranks 

above the 90th percentile with the exception of 2008. In terms of the number of 

researchers per million people, the U.S. ranks above the 90th percentile between 2000 and 

2004 and above the 85th percentile in 2005 and 2006. In terms of the number of scientific 

and technical journal articles published per capita, the U.S. ranks above the 90th

percentile. 

According to 2007 National Science Foundation data on research and development 

funded by companies, 31 % of expenditures are in computer and electronic products, 

30 % in chemicals, and 19 % in transportation. A large percentage of the computer and 

electronic research is in semiconductor and other electronic components. Approximately 

76 % of total nonfederal research is in development, 20 % in applied research, and 4 % in 

basic research.

Three international comparative indices were discussed that ranked national 

competitiveness: (1) UNIDO’s Competitive Industrial Performance Index; (2) the World 

Economic Forum’s Global Competitiveness Report; and (3) the IMD World 

Competitiveness Center’s World Competitiveness Yearbook. These indices do not 

specifically address the manufacturing industry, but provide an overall comparison of 

economic activity. Among 121 nations, the Competitive Industrial performance Index 

ranked the U.S. as 9th, 10th, and 12th in 1993, 1998, and 2003. The Global 

Competitiveness Report ranked the U.S. as 4th in 2010-2011, 2nd in 2009-2010, and 1st in 

2008-2009. The World Competitiveness Yearbook ranked the U.S. as 1st out of 59 

countries in 2011. 

5.4 Characteristics of the U.S. Manufacturing Industry

As seen in the manufacturing supply chain in Figure 4.5, there are many suppliers of 

goods and services that also have a stake in the industry; these include resellers, providers 

of transportation and warehousing, raw material suppliers, suppliers of intermediate 

goods, and suppliers of professional services. The manufacturing industry shipped

$4 436.2 billion of goods in 2009 according to the industry supply chain in Figure 4.5. 

The value of communications; computer hardware, software, and other equipment; 

professional, technical, and data services; and other items used by the industry were $5.2 

billion, $12.0 billion, and $29.3 billion, and $254.9 billion, respectively. These items, 

represented in blue in the supply chain, represent 6.8 % of the total value of 

manufacturing shipments. Capital expenditures on buildings and structures ($43.3 

billion), machinery and equipment ($110.9 billion), and maintenance and repair were 

4.3 %. Compensation ($695.6 billion) was 15.7 % while materials and energy (shown in 

green in the supply chain) were 55.0 %. The expenditures just mentioned, account for 

82.0 % of total shipments, net income accounted for 14.9 %, and net inventories and 

depreciation accounted for 3.1 %. 
75

6 Discussion and Research Needs

6.1 Discussion

There are many theories that speculate the future of the U.S. manufacturing industry. 

These theories must take into account and be consistent with the data available on the 

industry. Frequently, anecdotal observations are used to depict the industry; however, the 

insight from these types of observations is limited, as the manufacturing industry includes 

hundreds of thousands of establishments with millions of employees making trillions of 

dollars worth of goods. Additionally, national economies are often compared to 

companies competing for market share; unfortunately, this is somewhat misleading. This 

report brings together data on the current state of the U.S. manufacturing industry as it 

relates to its stakeholders and, to the extent possible, compares this data internationally to 

develop a quantitative depiction of the industry. This provides a structured approach to 

characterizing the industry and its subsectors.

There is a general concern that the U.S. manufacturing industry has lost competitiveness 

with Asian manufacturing, particularly China. With over 1.3 billion people (more than 

the combined 2009 population of the U.S., Canada, Australia, Japan, and the whole of 

Europe), the Chinese economy has the potential to far exceed the size of the U.S. 

economy. However, China’s rise is recent, rapid, and has come with some costs. Many of 

the policies and activities to attract manufacturing have short term gains for long term 

losses. Air and water pollution are becoming a significant concern82 as is waste disposal, 

which is inadequate as significant amounts of China’s waste ends up in unlicensed dumps 

in the countryside.83 A looming housing bubble, harsh conditions for some workers, low 

wages, gender imbalance in the population, and remnants of a command economy may 

pose challenges to China’s social and economic future.84, 85, 86 Thus, the sustainability of 

China’s current economic situation is unknown and may face the prospects of a 

slowdown in growth as many emerging economies have experienced.87, 88 Therefore, it is 

also important to bear in mind that U.S. economic concerns regarding China are not 

unique. The U.S. has had similar concerns regarding Japan, Mexico, Thailand, and 

India.89 It is important to examine U.S. manufacturing in a way that considers the entirety 

of the industry and its subsectors while considering the various aspects of the industry. 

 

82 BBC. “China Pollution ‘Threatens Growth’.” February 28, 2011. <http://www.bbc.co.uk/news/worldasia-pacific-12595872>

83 CBS News. “As Economy Grows, So Do China’s Garbage Woes.” October 11, 2009. 

<http://www.cbsnews.com/stories/2009/10/11/ap/asia/main5377158.shtml>

84 Davis, Bob. “The Great Property Bubble of China May be Popping.” June 9, 2011. 

<http://online.wsj.com/article/SB10001424052702304906004576367121835831168.html>

85 Shepherd, Robert J. “The People’s Dynasty: Culture and Society in Modern China.” Modern Scholar. 

Lecture Series. 2010.

86 Harney, Alexandra. The China Price. (London, England: The Penguin Press, 2008). 

87 Economist. “Converging Economies: One-Track Bind.” September 24, 2011. 

<http://www.economist.com/node/21528985>

88 Zhang, Kevin Honglin. “Is China the World Factory.” In China as the World Factory. (New York: 

Routeledge, 2006). 

89 Harney, Alexandra. The China Price. (London, England: The Penguin Press, 2008). 
76

China’s manufacturing industry is rapidly approaching the size of the U.S. manufacturing 

industry; however, China’s industry is far smaller than the U.S. industry on a per capita 

basis. 

All this is not to say that the U.S. manufacturing industry does not have deficiencies, but 

the U.S. produced more manufactured goods per capita than 92.6 % of OECD reporting 

countries in 2007 and produced more than any other country in the world. Industry 

growth, however, has been somewhat stagnant in the U.S. when compared 

internationally. UNSD data suggests that U.S. manufacturing growth is below the 20th

percentile of 180 countries. Manufacturing as a percent of GDP has declined in the U.S.; 

however, this percentage has declined globally. As demonstrated in this report, there are 

many aspects involved in tracking the current state and recent trends in the U.S. 

manufacturing industry and no single metric provides an accurate depiction. 

6.2 Recommendations for Further Research

Tracking manufacturing activity provides significant challenges. For example, the 

components of one product may be produced in several different countries; the iPod is 

one example. Between the design and production of the iPod there are a number of 

countries involved: England, Germany, France, Italy, Japan, Korea, and the United 

States.90 Further research is needed to understand the role the U.S. has in developing and 

manufacturing intermediate and finished parts. 

This report has focused on the trends and current state of the U.S. manufacturing industry 

and, therefore, largely excludes the environment in which the manufacturing industry 

operates. This includes taxes, regulations, infrastructure, the labor market, and current 

economic conditions among other things. These are the factors that are often driving the 

trends in the industry and exploring these items might reveal means for improving U.S. 

manufacturing competitiveness.

This report primarily used gross operating surplus as a proxy to compare manufacturing 

industry profits or net income from various countries; however, there was little discussion 

on how closely these two items correlate. Further investigation might confirm the use of 

gross operating surplus as a proxy for profit; alternatively, further investigation might 

reveal additional data sets detailing international profits.

There are a number of expected returns that were not comprehensively examined due to 

data constraints: capital gains for financiers, profit from markup for retailers, and final 

product utilization. Further examination of these factors could provide further insight into 

the manufacturing industry. As discussed previously, there are also issues regarding price 

indices. Investigating this issue might ensure that time series data accurately reflects 

changes in the manufacturing industry.

 

90 Bhide, Amar. The Venturesome Economy. (New Jersey: Princeton University Press, 2008): 21-23.
77

With continuing concern about the loss of manufacturing competitiveness, it would be 

advantageous to compare professional, scientific, and technical services related to the 

U.S. manufacturing industry to those abroad. In recent years there has been considerable 

concern regarding the hollowing out of U.S. manufacturing. An examination of 

professional, scientific, and technical services in the U.S. and abroad might reveal the 

extent of this hollowing out trend. Related to this topic is the extent to which supply 

chain goods and services are imported versus those that are domestically provided. This 

issue could be examined more closely using the detailed input-output data provided by 

the BEA. The input-output data used in this report breaks the U.S. economy into a little 

over 60 sectors with 19 of them being manufacturing. The detailed input-output data 

breaks the economy into over 400 sectors with over 250 being manufacturing. 

Examination of these data could reveal important details about inter-industry activity as 

well as details about the import of manufactured goods. For example, the use of these

data could quantify the value of the data and information services used by the 

manufacturing industry and each of its 250 subsectors. 

Although this report depicts the manufacturing industry with a focus on medium- and 

high-tech industry, the sectors included in these categories are only generally identified. 

Although the OECD definition of high-tech is commonly used, it seems that there is not a 

well-established criteria for identifying what types of manufacturing are high-tech, 

medium-tech, or low-tech. It is often the case that authors refer to medium- and high-tech 

manufacturing and simply specify the industries to which they are referring. Additionally, 

those things that are considered high-tech today may not be considered high-tech in the 

future; that is, the industries in this category change over time. Thus, high-tech cannot be 

defined by specifying a set of subsectors; rather, it must be defined by a set of criteria. 

This improved clarity would provide a better understanding of those sectors that might be 

more advantageous to invest additional research and development. 

This report has brought together multiple data sources of aggregate manufacturing 

industry data and industry subsector data to develop a quantitative depiction of the U.S. 

manufacturing industry as it relates to industry stakeholders. It then compared the 

industry to its international counterparts. This approach has not comprehensively 

explored all issues within the manufacturing industry; however, it has provided an 

evidence-based characterization that avoids using anecdotal data. 
78
79

Literature Cited

Atkinson, Robert D. and David B. Audretsch. “Economic Doctrines and Policy Differences: Has the 

Washington Policy Debate Been Asking the Wrong Questions?” The Information Technology and 

Innovation Foundation. September 2008. < http://www.itif.org/files/EconomicDoctrine.pdf>

Banister, Judith. “Manufacturing Employment and Compensation in China.” November 2005. 

<http://www.bls.gov/fls/chinareport.pdf> 

BBC. “China Pollution ‘Threatens Growth’.” February 28, 2011. <http://www.bbc.co.uk/news/world-asiapacific-12595872>

Beck, Robin. “Hydraulic Fracturing: The Fuss, The Facts, The Future.” Journal of Petroleum Technology.

December (2010): 34-41.

Brodd, Ralph J. “Factors Affecting U.S. Production Decisions: Why are There No Volume Lithium-Ion 

Battery Manufacturers in the United States.” ATP Working Paper 05-01. June 2005. 

<http://www.atp.nist.gov/eao/wp05-01/wp05-01.pdf>

Bhatnagar, Rohit and Amrik S. Sohal. “Supply Chain Competitiveness: Measuring the Impact of Location 

Factors, Uncertainty and Manufacturing Practices.” Technovation. 25 (2005): 443-456. 

Bhide, Amar. The Venturesome Economy. (New Jersey: Princeton University Press, 2008): 21-23.

Bureau of Economic Analysis. “U.S. Economic Accounts.” <http://www.bea.gov/>

Bureau of Labor Statistics. “Producer Price Indexes: How Does the Producer Price Index Differ from the 

Consumer Price Index.” <http://www.bls.gov/ppi/ppicpippi.htm>

Bureau of Labor Statistics. “BLS Productivity Statistics.” <http://www.bls.gov/bls/productivity.htm>

Byrne, David, Brian K. Kovak, and Bryan Michaels, “Offshoring and Price Measurement in the 

Semiconductor Industry.” In Susan N. Houseman and Kenneth F. Ryder, eds., Measurement Issues Arising 

from the Growth of Globalization. (Washington, DC: National Academy of Public Administration, 2010):

169-194.

Carbaugh, Robert J. International Economics. (Mason, OH, South Western Cengage Learning, 2011):78.

CBS News. “As Economy Grows, So Do China’s Garbage Woes.” October 11, 2009. 

<http://www.cbsnews.com/stories/2009/10/11/ap/asia/main5377158.shtml>

Census Bureau. “Annual Survey of Manufactures.” < http://www.census.gov/manufacturing/asm/>

Census Bureau. “Manufacturers’ Shipments, Inventories, and Orders.” 

<http://www.census.gov/manufacturing/m3/>

Center for Public Policy Innovation. “The Decline in Semiconductor Manufacturing in the United States.” 

June 2010. <http://cppionline.org/docs/The-Decline-of-Semiconductor-Manufacturing.pdf>

Committee on Prospering in the Global Economy of the 21st Century: An Agenda for American Science 

and Technology, National Academy of Sciences, National Academy of Engineering, Institute of Medicine. 

“Rising Above the Gathering Storm: Energizing and Employing America for a Brighter Economic Future.” 

National Academies Press. <http://www.nap.edu/catalog.php?record_id=11463>
80

Congressional Budget Office. “Factors Underlying the Decline in Manufacturing Employment Since 

2000.” December 23, 2008. <http://www.cbo.gov/ftpdocs/97xx/doc9749/12-23-Manufacturing.pdf>

Congressional Budget Office. “Taxing Capital Income: Effective Rates and Approaches to Reform.” 2005. 

<http://www.cbo.gov/ftpdocs/67xx/doc6792/10-18-Tax.pdf>

Davidson, Adam. “Making It in America.” The Atlantic. January/February 2012. 

<http://www.theatlantic.com/magazine/archive/2012/01/making-it-in-america/8844/?single_page=true>

Davidson, Adam. “The Transformation of American Factory Jobs, In One Company.” NPR. January 13, 

2012. <http://www.npr.org/blogs/money/2012/01/13/145039131/the-transformation-of-american-factoryjobs-in-one-company?ft=1&f=100>

Davis, Bob. “The Great Property Bubble of China May be Popping.” June 9, 2011. 

<http://online.wsj.com/article/SB10001424052702304906004576367121835831168.html>

De Rassenfosse, G. and B. van Pottelsberghe. “A Policy Insight into the R&D Patent Relationship.” ULB 

Working Paper. 2008.

Economist. “Converging Economies: One-Track Bind.” September 24, 2011. 

<http://www.economist.com/node/21528985>

Economist. “The Dwindling Allure of Building Factories Offshore.” May 12, 2011. 

<http://www.economist.com/node/18682182?fsrc=rss&story_id=18682182>

Engardio, Pete. “Can the Future Be Built in America.” Bloomberg Businessweek. April 26, 2009. 

<http://www.businessweek.com/magazine/content/09_38/b4147046115750.htm>

Greenwald, Bruce C.N. and Judd Kahn. Globalization: The Irrational Fear that Someone in China will 

Take Your Job. (Hoboken, NJ: John Wiley & Sons, 2009). 

Hopp, Wallace J. and Mark L. Spearman. Factory Physics. Third Edition. (Long Grove, IL: Waveland 

Press, 2011). 37-38.

Harney, Alexandra. The China Price. (London, England: The Penguin Press, 2008). 

Horowitz, Karen J. and Mark A. Planting. Concepts and Methods of the U.S. Input-Output Accounts.

Bureau of Economic Analysis. 2009. <http://www.bea.gov/papers/pdf/IOmanual_092906.pdf>

Houseman, Susan. “Outsourcing, Offshoring, and Productivity Measurement in U.S. Manufacturing.” 

Upjohn Institute Staff Working Paper No. 06-130. June 2006. 

<http://www.upjohninst.org/publications/wp/06-130.pdf>

Houseman, Susan, Christopher Kurz, Paul Lengermann, and Benjamin Mandel. “Offshoring and the State 

of American manufacturing.” W.E. Upjohn Institute for Employment Research. June 2010.

<http://www.upjohn.org/publications/wp/10-166.pdf>

IC Insights. Research Bulletin. April 21, 2011. 

<http://www.icinsights.com/data/articles/documents/263.pdf>

Kelley, Charles, Mark Wang, Gordon Bitko, Michael Chase, Aaron Kofner, Julia Lowell, James Mulvenon, 

David Ortiz, and Kevin Pollpeter. “High-Technology Manufacturing and U.S. Competitiveness.” RAND 

Technical Report. March 2004. <http://www.rand.org/pubs/technical_reports/2004/RAND_TR136.pdf>

Krugman, Paul. “Competitiveness, A Dangerous Obsession.” Foreign Affairs. Vol 73. Num 2. March/April 

(1994): 28-44.
81

Krugman, Paul. “Making Sense of the Competitiveness Debate.” Oxford Review of Economic Policy. Vol. 

12 no. 3 (1996): 17-25.

Krugman, Paul R. and Robert Z. Lawrence. “Trade, Jobs, and Wages,” Scientific American, April (1994): 

22-27. 

Mandel, Benjamin R. “Why is the U.S. Share of World Merchandise Exports Shrinking.” Federal Reserve 

Bank of New York: Current Issues. Vol. 18, No. 1. 2012. 

<http://www.newyorkfed.org/research/current_issues/ci18-1.pdf>

Miller, Ronald E. and Peter D. Blair. Input-Output Analysis: Foundations and Extensions. (New York: 

Cambridge University Press, 2009). 16.

National Public Radio. “Stopping the ‘Brain Drain’ of the U.S. Economy.” February 6, 2012. 

<http://www.npr.org/2012/02/05/146434854/stopping-the-brain-drain-of-the-u-s-economy?ft=1&f=100>

National Science Board. “Research and Development: Essential Foundation for U.S. Competitiveness in a 

Global Economy.” 2008. <http://www.nsf.gov/statistics/nsb0803/nsb0803.pdf>

National Science Foundation. “Advancing Measures of Innovation.” June 2006. 

<http://www.nsf.gov/statistics/nsf07306/>

National Science Foundation. “Asia’s Rising Science and Technology Strength.” May 2007. 

<http://www.nsf.gov/statistics/nsf07319/>

National Science Foundation. “Business and Industrial R&D.” <http://www.nsf.gov/statistics/industry/>

Neary, J. Peter. “Measuring Competitiveness.” IMF Working Paper WP/06/209. September 2006. 

<http://www.imf.org/external/pubs/ft/wp/2006/wp06209.pdf>

Nordhaus, William. “The Sources of the Productivity Rebound and the Manufacturing Employment 

Puzzle.” NBER Working Paper. May 2005. <http://www.nber.org/papers/w11354>

OECD. “Measuring Globalisation: OECD Handbook on Economic Globalisation Indicators.” May 2005. 

<http://www.oecd-ilibrary.org/economics/measuring-globalisation-oecd-handbook-on-economicglobalisation-indicators-2005_9789264108103-en >

OECD. OECD Patent Statistics Manual. 2009. 

<http://browse.oecdbookshop.org/oecd/pdfs/free/9209021e.pdf>

OECD. “StatExtracts.” <http://stats.oecd.org/Index.aspx>

Pisano, Gary P. and Willy C. Shih. Restoring American Competitiveness. Harvard Business Review. JulyAugust (2009).

Porter, Michael E. “Building the Microeconomic Foundations of Prosperity: Findings from the Business

Competitiveness Index.” In Porter, Michael E., Klaus Schwab, Xavier Sala-i-Martin, and Augusta LopezClaros. The Global Competitiveness Report 2003-2004. (New York: Oxford University Press, 2004).

Porter, Michael E. The Competitive Advantage of Nations. 1

st ed. (New York: The Free Press, 1990).

Rowthorn, Robert and Ramana Ramaswamy. “Deindustrialization: Causes and Implications,” International 

Monetary Fund Working Paper WP/97/42. April 1997.
82

Schweitzer, Mark and Saeed Zaman. “Are we Engineering Ourselves out of Manufacturing Jobs.” Federal 

Reserve Bank of Cleveland. January 2006.

<http://www.clevelandfed.org/research/commentary/2006/0101.pdf>

SEMI. Semiconductor, LED, and MEMS Fabs and Foundries. <http://www.semi.org/en/>

Shepherd, Robert J. “The People’s Dynasty: Culture and Society in Modern China.” Modern Scholar. 

Lecture Series. 2010.

Sirkin, Harold L. “Made in the USA Still Means Something.” Bloomberg Businessweek. April 10, 2009. 

<http://www.businessweek.com/managing/content/apr2009/ca20090410_054122.htm>

Slaughter, Matthew J. “How U.S. Multinational Companies Strengthen the U.S. Economy.” United States 

Council for International Business. March 2010. 

<http://www.uscib.org/docs/foundation_multinationals.pdf>

Tassey Gregory. “Rationales and Mechanisms for Revitalizing U.S. Manufacturing R&D Strategies.” 

Journal of Technology Transfer. 35 (2010). 283-333.

Toder, Eric. “International Competitiveness: Who Competes Against Whom and for What?” Tax Policy 

Center: Urban Institute and Brookings Institution. January 2012. 

<http://www.taxpolicycenter.org/UploadedPDF/412477-international-competitiveness.pdf>

United Nations Statistics Division. “National Accounts Main Aggregates Database.” 

<http://unstats.un.org/unsd/snaama/Introduction.asp>

UNIDO. “Statistical Country Briefs.” <http://www.unido.org/index.php?id=1000313>

UNIDO Strategic Research Database. Competitive Industrial Performance Index. 2003. 

<http://www.unido.org/index.php?id=5058>

UNIDO. “Industrial Development Scoreboard: Technical Notes.” 

<http://www.unido.org/index.php?id=5058>

US-China Business Council. “US Manufacturing: Dying... Or Still Going Strong?” 2006. 

<https://www.uschina.org/public/documents/2006/09/us-manufacturing.pdf>

Ward, William A. “Manufacturing Productivity and the Shifting US, China, and Global Job Scenes—1990 

to 2005.” Clemson University Center for International Trade Working Paper 052507. August 2005. 

<http://ageconsearch.umn.edu/bitstream/112948/2/citpaper12.pdf>

World Bank. World Development Indicators. Washington DC, World Bank, 2011. 314-317.

World Economic Forum. The Global Competitiveness Report. 2010-2011. 

<http://www3.weforum.org/docs/WEF_GlobalCompetitivenessReport_2010-11.pdf>

Yamano, Norihiki and Nadim Ahmad. “The OECD Input-Output Database: 2006 Edition. 

DSTI/DOC(2006)8. STI Working Paper 2006/8. October 2006. 

<http://www.oecd.org/dataoecd/46/54/37585924.pdf>

Zhang, Kevin Honglin. “Is China the World Factory.” In China as the World Factory. (New York: 

Routeledge, 2006). 
83

Appendix A: Global Competitiveness Index Rankings

(World Economic Forum)

Table A.1 below represents the Global Competitiveness Index Rankings for the United 

States and 8 other countries. The Global Competitiveness Report is a yearly report 

published by the World Economic Forum that ranks the world’s nations according to the 

Global Competitiveness Index. This report is commonly cited in reference to 

competitiveness issues. The ranking uses a weighted average of multiple components, 

which are categorized into 12 pillars of economic competitiveness highlighted in grey: 

institutions, infrastructure, macroeconomic environment, health and primary education, 

higher education and training, goods market efficiency, labor market efficiency, financial 

market development, technological readiness, market size, business sophistication, and 

innovation.91 The ranking from each pillar was used to create Figure 3.8. In Table A.1, 

the pillars include subcategories. Although this index measures the economy as a whole, 

it does provide insight into areas related to manufacturing. Note that the red bars are a 

visual comparison between countries; the shorter the bar the higher the ranking is when 

compared to the countries shown. Subcategories are highlighted in yellow if the U.S. 

ranks below the 70th percentile (ranks at or below 42nd) and red if it is below the 50th

percentile (ranks at or below 70th). The overall rank for the U.S. was 4th while 

Switzerland, Sweden, and Singapore were ranked 1st, 2nd, and 3rd respectively. 

 

91 World Economic Forum. The Global Competitiveness Report. 2010-2011. 

<http://www3.weforum.org/docs/WEF_GlobalCompetitivenessReport_2010-11.pdf>
84

Table A.1: Global Competitiveness Index Rankings among 139 countries (World Economic Forum), 2010-2011

United States Australia Canada China Germany India Japan Mexico UK

Overall Rank 4 1 6 1 0 2 7 5 5 1 6 6 6 1 2

United States Australia Canada China Germany India Japan Mexico UK

Market size 1 1 8 1 4 2 5 4 3 1 2 6

Domestic market size index 1 1 7 1 4 2 5 4 3 1 1 6

foreign market size index 2 3 0 1 8 1 3 4 9 1 5 5

United States Australia Canada China Germany India Japan Mexico UK

Innovation 4 2 1 1 1 2 6 8 3 9 4 7 8 1 4

University-industry collaboration in R&D 1 1 3 7 2 5 9 5 8 1 9 5 9 4

Utility patents per million population 3 1 7 1 0 5 1 9 5 9 2 6 0 2 0

Quality of scientific research institutions 4 1 0 8 3 9 6 3 0 1 5 6 0 3

Availability of scientists and engineers 4 4 5 6 3 5 2 7 1 5 2 8 9 2 9

Gov't procurement of advanced tech products 5 3 7 2 6 1 2 3 2 7 6 4 1 9 6 5 3

Capacity for innovation 6 2 3 1 9 2 1 1 3 3 2 8 6 1 5

Company spending on R&D 6 2 3 2 0 2 2 4 3 7 3 9 0 1 4

United States Australia Canada China Germany India Japan Mexico UK

Labor Market Efficiency 4 1 1 6 3 8 7 0 9 2 1 3 120 8

Rigidity of employment 1 1 8 7 8 108 7 7 3 6 104 1 8

Redundancy costs 1 6 5 5 114 9 8 8 9 6 8 1 4 0

Brain drain 3 2 2 9 3 7 3 1 3 4 2 6 7 4 1 0

Hiring and firing practices 6 7 9 1 5 6 2 133 8 9 121 120 4 9

Pay and productivity 9 5 3 3 0 1 5 4 3 6 1 1 2 9 8 2 5

Reliance on professional management 1 5 8 5 5 0 1 4 4 9 1 6 102 7

Cooperation in labor-employer relations 3 3 4 3 2 8 5 8 1 8 4 9 7 7 4 2 6

Flexibility of wage determination 3 4 110 3 3 5 6 136 6 1 1 5 9 2 2 0

Female participation in labor force 4 9 5 1 2 4 2 3 4 4 128 8 8 117 4 7
85

United States Australia Canada China Germany India Japan Mexico UK

Business sophistication 8 2 9 1 6 4 1 3 4 4 1 6 7 9

Extent of marketing 1 1 6 1 0 4 9 7 5 7 9 7 2 4

State of cluster development 6 3 5 1 1 1 7 1 2 2 9 2 5 0 1 0

Control of international distribution 8 3 1 3 6 4 2 2 6 4 1 7 6 1 9

Willingness to delegate authority 8 1 2 7 6 8 9 4 8 1 3 8 6 1 6

Local supplier quantity 1 1 3 7 2 0 1 9 3 7 1 7 1 2 3

Production process sophistication 1 1 2 4 1 5 5 5 2 4 3 1 6 1 1 7

Local supplier quality 1 4 1 6 7 5 4 3 6 0 4 5 5 3 0

Value chain breadth 1 5 7 8 3 3 4 1 1 4 2 2 4 9 1 1

Nature of competititive advantage 1 9 5 9 5 6 4 8 3 6 1 1 8 5 9

United States Australia Canada China Germany India Japan Mexico UK

Higher education and training 9 1 4 8 6 0 1 9 8 5 2 0 7 9 1 8

Tertiary education enrollment rate 6 1 3 2 7 8 8 5 2 101 3 4 8 0 3 5

Local availability of research and training services 1 0 2 0 1 1 5 0 2 5 1 1 3 5 5 1 2

Extent of staff training 1 0 2 0 1 2 5 7 8 5 9 6 8 4 2 8

Quality of management schools 1 1 1 7 3 6 3 3 1 2 3 6 5 5 2 1 0

Internet access in schools 1 4 2 8 1 3 2 2 3 9 7 0 4 0 8 9 1 8

Quality of the educational system 2 6 1 2 5 5 3 1 8 3 9 3 5 120 2 8

Secondary education enrollment rate 4 5 1 1 9 9 2 1 8 108 2 1 6 1 2 8

Quality of math and science education 5 2 2 4 1 0 3 3 3 9 3 8 2 8 128 5 5

United States Australia Canada China Germany India Japan Mexico UK

Infrastructure 1 5 2 2 9 5 0 2 8 6 1 1 7 5 8

Available airline seat kilometers 1 6 1 0 2 5 1 2 4 2 0 3

Fixed telephone lines 1 6 2 3 1 2 5 7 5 110 3 4 7 2 1 1

Quality of railroad infrastructure 1 8 2 6 1 6 2 7 5 2 3 3 7 6 1 9

Quality of roads 1 9 3 0 1 7 5 3 5 9 0 2 2 6 2 3 5

Quality of port infrastructure 2 2 4 6 1 4 6 7 5 8 3 3 7 8 9 2 3

Quality of overall infrastructure 2 3 3 4 1 3 7 2 9 9 1 1 5 7 9 3 3

Quality of electricity supply 2 3 3 3 1 4 5 2 6 110 5 9 1 1 5

Quality of air transport infrastructure 3 2 3 0 2 3 7 9 3 7 1 5 4 6 5 3 4

Mobile telephone subscriptions 7 1 4 2 100 111 2 6 118 7 5 9 3 2 4
86

United States Australia Canada China Germany India Japan Mexico UK

Technological readiness 1 7 2 3 1 6 7 8 1 0 8 6 2 8 7 1 8

Availability of latest technologies 7 2 2 1 4 9 4 1 7 4 1 1 8 7 4 1 5

Firm-level technology absorption 1 1 1 9 2 2 6 1 1 4 3 9 3 8 7 2 1

Broadband Internet subscriptions 1 6 1 8 1 2 5 6 1 0 100 2 0 5 1 1 1

Internet users 1 7 2 0 1 5 7 7 1 4 118 2 1 8 5 9

Internet bandwidth 2 9 4 0 1 8 8 0 1 2 119 3 9 8 9 6

Foreign Direct Investment and technology transfer 5 5 2 2 2 9 8 0 8 5 2 8 6 8 3 2 1 7

United States Australia Canada China Germany India Japan Mexico UK

Goods Market Efficiency 2 6 1 8 1 1 4 3 2 1 7 1 1 7 9 6 2 2

Extent of market dominance 9 1 1 1 3 2 3 1 2 6 2 127 1 0

Time required to start a business 1 3 2 9 108 6 5 9 3 7 7 4 5 4 5

Buyer sophistication 1 3 1 6 6 7 1 8 4 3 1 7 9 8

Intesity of local competition 1 6 1 1 2 0 1 9 2 3 0 7 9 8 8

Effectiveness of anti-monopoy policy 1 7 1 5 1 4 5 0 3 2 9 7 116 8

Degree of customer orientation 2 2 2 0 1 3 7 0 1 1 6 4 1 6 8 4 4

Trade tariffs 3 2 5 5 3 8 122 4 124 3 6 9 2 4

Number of procedures required to start a business 3 4 3 1 126 8 8 121 7 3 7 3 3 4

Prevalence of foreign ownership 4 7 1 9 1 1 103 3 6 8 1 9 7 2 2 7

Burden of customs procedures 4 8 2 4 2 7 4 6 2 1 8 1 4 1 8 7 3 1

Agricultural policy costs 5 8 9 2 8 5 8 5 8 1 133 126 5 3

Prevalence of trade barriers 6 7 2 4 4 5 6 9 3 6 9 6 8 5 5 5 2 1

Extent and effect of taxation 7 1 6 6 4 8 2 9 9 0 3 6 102 113 9 5

Business impact of rules on FDI 7 7 5 7 4 8 1 8 6 3 4 6 9 1 6 4 1 4

Total tax rate 8 9 9 4 7 9 122 8 4 123 111 104 5 4

United States Australia Canada China Germany India Japan Mexico UK

Financial market development 3 1 3 1 2 5 7 3 6 1 7 3 9 9 6 2 5

Venture capital availability 1 3 1 2 1 9 2 7 5 2 3 1 4 9 9 6 3 8

Availability of financial services 1 5 1 4 2 7 1 8 4 5 4 1 7 9 5

Legal rights index 2 0 6 6 0 6 0 3 9 2 0 3 9 8 6 6

Affordability of financial services 2 1 2 5 1 4 4 4 1 8 3 8 3 3 105 1 0

Ease of access to loans 3 4 1 6 2 4 5 1 6 9 3 9 4 6 9 6 7 4

Financing through local equity market 3 6 1 5 8 5 2 4 9 1 0 2 4 9 4 3 2

Regulation of securities exchanges 6 4 1 0 2 2 6 1 3 5 1 5 4 0 9 1 4 2

Restriction on capital flows 6 9 3 2 3 9 123 1 5 7 5 5 1 4 2 1 0

Soundness of banks 111 3 1 6 0 112 2 5 7 7 4 2 133
87

United States Australia Canada China Germany India Japan Mexico UK

Instititutions 4 0 1 4 1 1 4 9 1 3 5 8 2 5 106 1 7

Strength of investor protection 5 4 5 5 7 7 7 7 3 3 1 6 3 3 1 0

Intellectual property protection 2 4 1 4 1 3 4 9 9 6 6 2 1 8 5 1 7

Reliability of police services 2 6 1 9 7 5 1 1 2 6 8 2 2 132 3 1

Efficacy of corporate boards 2 8 7 4 8 5 1 5 7 6 1 9 112 1 6

Ethical behavior of firms 3 0 1 0 8 5 5 1 3 7 0 1 8 9 3 1 4

Efficiency of legal framework in settling disputes 3 3 1 2 1 4 4 4 1 5 4 7 2 7 102 8

Diversion of public funds 3 4 1 3 1 6 5 5 1 4 7 1 2 7 9 8 1 1

Judicial independence 3 5 9 1 1 6 2 5 4 1 2 0 9 2 8

Efficiency of legal framework in challenging regulations 3 5 1 3 1 8 5 1 8 3 7 3 3 7 7 1 6

Property rights 4 0 1 4 1 0 3 8 8 6 1 2 3 8 8 1 7

Irregular Payments and bribes 4 0 1 6 1 2 6 3 2 0 8 3 1 1 9 1 2 1

Protection of minority shareholders' interests 4 0 1 5 8 6 6 1 3 5 5 2 7 8 1 1 7

Transparency of government policymaking 4 1 1 9 1 1 3 8 1 3 4 2 4 8 7 9 3 4

Burden of government regulation 4 9 6 0 4 1 2 1 9 2 9 5 7 0 116 8 9

Public trust of politicians 5 4 1 7 2 3 2 2 2 9 8 8 5 8 9 4 5 5

favoritism in decisions of government officials 5 5 1 9 2 0 3 7 1 6 7 2 1 4 8 3 2 3

Strength of auditing and reporting standards 5 5 1 4 6 6 1 2 1 4 5 3 3 6 8 2 2

Wastefulness of government spending 6 8 2 1 3 2 3 5 3 3 5 7 9 1 8 1 7 2

Business costs of crime and violence 8 4 4 5 4 9 4 7 2 3 6 7 5 3 132 5 5

Organized crime 8 6 3 2 5 0 7 6 2 8 7 3 7 1 136 3 9

Business costs of terrorism 125 8 0 9 6 7 9 5 6 127 9 5 112 9 9

United States Australia Canada China Germany India Japan Mexico UK

Health and Primary Education 4 2 1 3 6 3 7 2 5 104 9 7 0 1 9

Business impact of malaria 1 1 1 9 0 1 102 1 7 4 1

Malaria incidence 1 1 1 8 0 1 108 1 8 1 1

Tuberculosis incidence 6 2 0 8 8 6 9 101 4 5 4 2 3 2

Life expectancy 3 4 7 1 1 7 0 1 9 109 1 5 1 2 1

Quality of primary education 3 4 1 4 9 3 5 3 6 9 8 2 0 120 2 7

Infant mortality 4 1 2 8 3 5 7 5 2 0 111 6 7 0 2 8

Business impact of tuberculosis 5 3 3 5 9 7 4 1 1 8 7 5 0 4 4 3 6

Primary education enrollment rate 7 9 4 2 8 7 2 7 9 5 2 2 9 6

Business impact of HIV/AIDS 8 0 5 3 2 5 5 6 1 2 9 9 4 2 7 8 5 4

HIV prevalence 8 9 5 5 7 7 2 2 2 2 7 1 1 7 1 5 5
88

United States Australia Canada China Germany India Japan Mexico UK

Macroeconomic Environment 8 7 1 7 3 6 4 2 3 7 3 105 2 8 5 6

Country credit rating 1 1 1 4 4 3 2 6 5 0 1 6 4 5 1 8

Inflation 1 5 4 9 2 4 1 0 2 0 123 4 9 6 5 4

Interest rate spread 2 6 3 5 2 0 3 3 2 8 6 5 7 6 2 2

Government budget balance 118 6 7 3 4 3 5 2 6 8 1 134 1 9 117

Government debt 122 2 3 120 1 8 114 115 137 5 0 108

National savings rate 130 4 6 8 0 3 5 6 9 5 1 5 9 107
89

Appendix B: IMD World Competitiveness Yearbook, 2011

The World Competitiveness Yearbook is a product of the International Institute for Management Development’s (IMD) World 

Competitiveness Center. The Yearbook is a ranking of nations based on their ability to create and maintain an environment where 

enterprises can compete. This environment is broken into 4 factors: economic performance, government efficiency, business 

efficiency, and infrastructure. Each of these factors is broken into 5 sub-factors for a total of 20, which are given equal weight in 

determining overall rank among the 59 countries evaluated. There are over 300 criteria used to determine the sub-factors. The 

rankings for the U.S. and a selection of other nations are shown below. Note that the red bars are a visual comparison between 

countries; the shorter the bar the higher the ranking is when compared to the countries shown. Subcategories are highlighted in yellow 

if the U.S. ranks below the 70th percentile and red if it is below the 50th percentile.

Table B.1: IMD World Competitiveness Yearbook

United States Australia Canada China Germany India Japan Mexico UK

Overall Rank (out of 59 countries) 1 9 7 1 9 1 0 3 2 2 6 3 8 2 0

Domestic Economy 1 1 4 1 1 4 6 8 7 2 9 2 1

Scientific Infrastructure 1 1 3 1 1 1 0 3 2 8 2 3 8 9

International Investment 2 1 7 1 2 2 0 6 2 4 5 4 2 7 5

Tech. Infrastructure 2 2 5 9 2 0 1 3 2 2 2 6 5 5 1 7

Productivity and Efficiency 5 2 5 1 7 1 9 1 1 3 4 2 8 3 9 2 3

Business Legislation 9 4 8 4 7 2 2 4 8 2 7 5 3 1 6

Basic Infrastructure 9 1 7 2 7 5 5 0 2 0 4 9 2 6

Prices 1 0 3 6 1 6 3 2 1 4 3 9 4 5 1 1 2 0

International Trade 1 2 1 4 3 5 7 1 1 3 0 4 5 4 3 3 6

Institutional Framework 1 2 2 8 1 4 6 1 1 1 8 2 4 3 9 1 0

Finance 1 3 5 3 3 5 1 5 1 8 2 0 4 4 2 4

Management Practices 1 4 5 7 3 7 1 5 3 3 2 4 4 2 3 9

Societal Framework 1 8 9 1 1 4 2 5 4 0 3 5 5 2 1 9

Labor Market 1 8 1 2 2 3 4 3 0 1 3 2 6 3 2 3 5

Health and Environment 1 8 9 1 0 5 3 8 5 8 1 1 4 4 2 1

Education 1 8 8 7 4 3 1 6 5 9 3 4 5 4 1 7

Attitudes and Values 2 2 2 6 2 8 2 7 9 3 6 4 6 3 0

Employment 2 6 8 1 8 1 1 6 8 1 3 1 5 3 1

Fiscal Policy 2 6 1 9 1 7 5 2 5 4 1 4 3 6 2 7 3 5

Public Finance 5 3 1 7 3 6 1 2 4 3 4 0 5 8 2 1 5 4
90
91

Appendix C: Annual Survey of Manufactures, Medium- and 

High-Tech Sectors (2009)

The Annual Survey of Manufactures (ASM) is conducted every year except for years 

ending in 2 or 7 when the Economic Census is conducted. The ASM provides statistics 

on employment, payroll, supplemental labor costs, cost of materials consumed, operating 

expenses, value of shipments, value added, fuels and energy used, and inventories. It uses 

a sample survey of approximately 50 000 establishments with new samples selected at 5-

year intervals. The ASM data allow the examination of multiple factors (value added, 

payroll, energy use, and more) of manufacturing at a detailed subsector level. The 

Economic Census, used for years ending in 2 or 7, is a survey of all employer 

establishments in the U.S. that has been taken as an integrated program at 5-year intervals 

since 1967. Both the ASM and the Economic Census use NAICS classification; however, 

prior to NAICS the Standard Industrial Classification system was used. Detailed 2009 

data is shown in Table C.1, which contains the number of employees, value added, total 

value of shipments, net income, and other metrics for chemical manufacturing (NAICS 

325); machinery manufacturing (NAICS 333); computer and electronic products 

manufacturing (NAICS 334); electrical equipment, appliance, and component 

manufacturing (NAICS 335); and transportation equipment manufacturing (NAICS 336) 

along with all the subsectors.
92

Table C.1: Annual Survey of Manufactures: Medium- and High-tech Sectors

Number of 

Employees

Value Added 

($1000)

Total Value of 

Shipments 

($1000)

Net Income 

($1000)

Compensation 

per Employee 

($1000)

Value Added 

per Employee 

($1000)

Net Income 

per Employee 

($1000)

Net Income 

per 

Expenditure 

Dollar ($1000)

325 Chemical mfg 724 683 328 870 852 628 945 803 181 231 086 85.9 453.8 250.1 0.426

3251 Basic chemical mfg 142 143 66 710 327 175 439 319 24 952 054 93.6 469.3 175.5 0.176

32511 Petrochemical manufacturing 9 167 18 846 611 52 086 422 14 466 939 127.9 2055.9 1578.2 0.399

325110 Petrochemical manufacturing 9 167 18 846 611 52 086 422 14 466 939 127.9 2055.9 1578.2 0.399

32512 Industrial gas manufacturing 9 287 4 930 678 7 499 403 1 999 242 90.5 530.9 215.3 0.405

325120 Industrial gas manufacturing 9 287 4 930 678 7 499 403 1 999 242 90.5 530.9 215.3 0.405

32513 Synthetic dye and pigment manufacturing 9 549 3 070 544 6 212 514 1 332 338 87.8 321.6 139.5 0.300

32513M Synthetic dye and pigment manufacturing 9 549 3 070 544 6 212 514 1 332 338 87.8 321.6 139.5 0.300

32518 Other basic inorganic chemical manufacturing 37 420 16 066 348 27 796 541 6 801 242 95.4 429.4 181.8 0.343

325181 Alkalies and chlorine manufacturing 5 973 2 856 531 5 376 112 1 026 361 108.7 478.2 171.8 0.247

325182 Carbon black manufacturing 1 489 418 525 1 183 144 78 401 87.3 281.1 52.7 0.078

325188 All other basic inorganic chemical manufacturing 29 958 12 791 293 21 237 284 5 696 477 93.2 427.0 190.1 0.389

32519 Other basic organic chemical manufacturing 76 720 23 796 146 81 844 439 352 292 89.7 310.2 4.6 0.005

32519M Other basic organic chemical manufacturing 76 720 23 796 146 81 844 439 352 292 89.7 310.2 4.6 0.005

3252 Resin, syn rubber, & artificial syn fibers & filaments mfg 81 177 27 236 501 72 112 280 10 442 794 82.7 335.5 128.6 0.178

32521 Resin and synthetic rubber manufacturing 67 932 25 447 365 66 857 343 10 359 499 87.3 374.6 152.5 0.192

325211 Plastics material and resin manufacturing 59 202 23 057 280 60 744 217 9 844 146 85.9 389.5 166.3 0.203

325212 Synthetic rubber manufacturing 8 730 2 390 085 6 113 126 515 353 96.8 273.8 59.0 0.095

32522 Artificial and synthetic fibers and filaments manufacturing 13 246 1 789 136 5 254 937 83 297 59.5 135.1 6.3 0.017

32522M Artificial and synthetic fibers and filaments manufacturing 13 246 1 789 136 5 254 937 83 297 59.5 135.1 6.3 0.017

3253 Pesticide, fertilizer, & other agricultural chemical mfg 26 794 16 142 416 32 950 257 8 938 460 75.5 602.5 333.6 0.396

32531 Fertilizer manufacturing 17 373 8 704 599 20 963 464 3 753 707 74.8 501.0 216.1 0.235

325311 Nitrogenous fertilizer manufacturing 3 950 3 775 018 7 054 673 2 188 935 92.9 955.7 554.2 0.492

325312 Phosphatic fertilizer manufacturing 6 065 3 012 934 8 688 260 834 340 83.6 496.8 137.6 0.115

325314 Fertilizer (mixing only) manufacturing 7 358 1 916 647 5 220 531 730 431 58.0 260.5 99.3 0.169

32532 Pesticide and other agricultural chemical manufacturing 9 422 7 437 817 11 986 793 5 184 755 76.6 789.4 550.3 0.788

325320 Pesticide and other agricultural chemical manufacturing 9 422 7 437 817 11 986 793 5 184 755 76.6 789.4 550.3 0.788

3254 Pharmaceutical & medicine mfg 236 439 140 568 339 191 409 938 94 384 540 99.9 594.5 399.2 1.018

32541 Pharmaceutical and medicine manufacturing 236 439 140 568 339 191 409 938 94 384 540 99.9 594.5 399.2 1.018

325411 Medicinal and botanical manufacturing 26 647 6 868 675 10 780 248 2 088 565 94.9 257.8 78.4 0.253
93

Number of 

Employees

Value Added 

($1000)

Total Value of 

Shipments 

($1000)

Net Income 

($1000)

Compensation 

per Employee 

($1000)

Value Added 

per Employee 

($1000)

Net Income 

per Employee 

($1000)

Net Income 

per 

Expenditure 

Dollar ($1000)

325412 Pharmaceutical preparation manufacturing 143 792 106 165 160 141 936 232 78 832 874 98.3 738.3 548.2 1.315

325413 In-vitro diagnostic substance manufacturing 26 516 8 134 126 11 878 476 2 507 315 107.0 306.8 94.6 0.275

325414 Biological product (except diagnostic) manufacturing 39 484 19 400 377 26 814 983 10 955 785 104.5 491.3 277.5 0.711

3255 Paint, coating, & adhesive mfg 54 419 14 000 152 29 202 317 6 960 821 70.9 257.3 127.9 0.325

32551 Paint and coating manufacturing 33 873 9 703 320 19 630 904 5 345 374 72.4 286.5 157.8 0.388

325510 Paint and coating manufacturing 33 873 9 703 320 19 630 904 5 345 374 72.4 286.5 157.8 0.388

32552 Adhesive manufacturing 20 545 4 296 831 9 571 413 1 615 450 68.4 209.1 78.6 0.212

325520 Adhesive manufacturing 20 545 4 296 831 9 571 413 1 615 450 68.4 209.1 78.6 0.212

3256 Soap, cleaning compound, & toilet preparation mfg 97 604 44 800 949 86 992 023 28 531 518 69.5 459.0 292.3 0.507

32561 Soap and cleaning compound manufacturing 43 612 24 824 391 48 470 784 16 739 308 72.4 569.2 383.8 0.550

32561M Soap and cleaning compound manufacturing 43 612 24 824 391 48 470 784 16 739 308 72.4 569.2 383.8 0.550

32562 Toilet preparation manufacturing 53 992 19 976 559 38 521 239 11 792 207 67.1 370.0 218.4 0.458

325620 Toilet preparation manufacturing 53 992 19 976 559 38 521 239 11 792 207 67.1 370.0 218.4 0.458

3259 Other chemical product & preparation mfg 86 106 19 412 167 40 839 669 7 020 901 68.7 225.4 81.5 0.217

32591 Printing ink manufacturing 12 131 1 827 126 4 265 317 331 346 63.0 150.6 27.3 0.086

325910 Printing ink manufacturing 12 131 1 827 126 4 265 317 331 346 63.0 150.6 27.3 0.086

32592 Explosives manufacturing 6 303 1 177 942 2 045 937 388 698 70.8 186.9 61.7 0.241

325920 Explosives manufacturing 6 303 1 177 942 2 045 937 388 698 70.8 186.9 61.7 0.241

32599 All other chemical product and preparation manufacturing 67 672 16 407 100 34 528 415 6 300 854 69.5 242.5 93.1 0.234

325991 Custom compounding of purchased resins 16 712 2 276 233 7 297 569 372 921 63.8 136.2 22.3 0.056

32599N All other miscellaneous chemical product and preparation mfg 50 959 14 130 867 27 230 846 5 927 935 71.4 277.3 116.3 0.292

333 Machinery mfg 962 083 133 056 578 287 634 198 24 575 525 66.0 138.3 25.5 0.097

3331 Agriculture, construction, & mining machinery mfg 180 379 31 666 182 75 886 277 9 652 216 66.0 175.6 53.5 0.151

33311 Agricultural implement manufacturing 70 923 12 752 651 30 933 763 5 410 521 61.2 179.8 76.3 0.219

333111 Farm machinery and equipment manufacturing 51 595 10 826 116 23 612 919 5 224 116 65.8 209.8 101.3 0.294

333112 Lawn and garden equipment manufacturing 19 328 1 926 535 7 320 844 186 408 48.7 99.7 9.6 0.027

33312 Construction machinery manufacturing 56 142 9 503 183 24 689 398 2 329 963 63.1 169.3 41.5 0.110

333120 Construction machinery manufacturing 56 142 9 503 183 24 689 398 2 329 963 63.1 169.3 41.5 0.110

33313 Mining and oil and gas field machinery manufacturing 53 314 9 410 347 20 263 115 1 911 728 75.4 176.5 35.9 0.105

33313M Mining and oil and gas field machinery manufacturing 53 314 9 410 347 20 263 115 1 911 728 75.4 176.5 35.9 0.105

3332 Industrial machinery mfg 109 976 12 272 993 26 417 663 -1 769 644 74.6 111.6 -16.1 -0.066

33321 Sawmill and woodworking machinery manufacturing 3 689 239 619 466 533 -50 750 48.8 65.0 -13.8 -0.105
94

Number of 

Employees

Value Added 

($1000)

Total Value of 

Shipments 

($1000)

Net Income 

($1000)

Compensation 

per Employee 

($1000)

Value Added 

per Employee 

($1000)

Net Income 

per Employee 

($1000)

Net Income 

per 

Expenditure 

Dollar ($1000)

333210 Sawmill and woodworking machinery manufacturing 3 689 239 619 466 533 -50 750 48.8 65.0 -13.8 -0.105

33322 Plastics and rubber industry machinery manufacturing 12 627 1 366 600 2 959 693 -13 934 65.8 108.2 -1.1 -0.005

333220 Plastics and rubber industry machinery manufacturing 12 627 1 366 600 2 959 693 -13 934 65.8 108.2 -1.1 -0.005

33329 Other industrial machinery manufacturing 93 660 10 666 774 22 991 436 -1 689 804 76.8 113.9 -18.0 -0.072

333295 Semiconductor machinery manufacturing 19 362 1 731 996 5 704 230 -2 389 732 104.7 89.5 -123.4 -0.311

33329N Other machinery manufacturing 74 297 8 934 778 17 287 206 699 929 69.6 120.3 9.4 0.045

3333 Commercial & service industry machinery mfg 75 385 11 039 940 20 930 670 2 693 144 67.7 146.4 35.7 0.153

33331 Commercial and service industry machinery manufacturing 75 385 11 039 940 20 930 670 2 693 144 67.7 146.4 35.7 0.153

333313 Office machinery manufacturing 5 333 988 941 1 659 541 457 775 70.1 185.4 85.8 0.395

333314 Optical instrument and lens manufacturing 16 348 2 384 283 4 673 039 217 089 82.2 145.8 13.3 0.051

333315 Photographic and photocopying equipment manufacturing 5 503 1 096 295 1 975 217 482 483 66.1 199.2 87.7 0.335

33331N All other commercial and service industry machinery mfg 48 201 6 570 422 12 622 873 1 535 796 62.7 136.3 31.9 0.143

3334 Ventilation, heating, AC, & commercial refrigeration equip mfg 126 063 15 970 899 34 646 153 4 485 617 55.6 126.7 35.6 0.153

33341 HVAC and commercial refrigeration equipment manufacturing 126 063 15 970 899 34 646 153 4 485 617 55.6 126.7 35.6 0.153

333414 Heating equipment (except warm air furnaces) manufacturing 16 539 1 951 684 3 786 626 -183 262 59.7 118.0 -11.1 -0.048

333415 AC, forced air heating, and refrigeration equipment mfg 86 454 11 641 118 26 308 906 4 222 576 55.8 134.7 48.8 0.197

33341N Ventilation equipment manufacturing 23 070 2 378 097 4 550 622 446 303 51.9 103.1 19.3 0.113

3335 Metalworking machinery mfg 129 596 11 970 310 20 604 679 -639 099 62.9 92.4 -4.9 -0.032

33351 Metalworking machinery manufacturing 129 596 11 970 310 20 604 679 -639 099 62.9 92.4 -4.9 -0.032

333511 Industrial mold manufacturing 30 488 2 807 137 4 221 870 -152 699 60.8 92.1 -5.0 -0.037

333512 Machine tool (metal cutting types) manufacturing 15 652 1 732 273 3 473 464 -300 061 72.8 110.7 -19.2 -0.084

333513 Machine tool (metal forming types) manufacturing 6 223 620 475 1 217 675 20 517 64.6 99.7 3.3 0.018

333514 Special die and tool, die set, jig, and fixture manufacturing 40 528 3 496 247 5 745 328 -236 893 61.9 86.3 -5.8 -0.042

333515 Cutting tool and machine tool accessory manufacturing 26 469 2 208 315 3 502 270 28 929 55.4 83.4 1.1 0.009

333516 Rolling mill machinery and equipment manufacturing 3 068 394 536 789 668 80 055 73.1 128.6 26.1 0.109

333518 Other metalworking machinery manufacturing 7 168 711 328 1 654 404 -78 949 77.9 99.2 -11.0 -0.048

3336 Engine, turbine, & power transmission equipment mfg 89 434 12 546 873 35 462 893 899 134 68.3 140.3 10.1 0.027

33361 Engine, turbine, and power transmission equipment mfg 89 434 12 546 873 35 462 893 899 134 68.3 140.3 10.1 0.027

333611 Turbine and turbine generator set unit manufacturing 26 200 4 126 854 11 873 050 686 358 77.6 157.5 26.2 0.063

333612 Speed changer, industrial high-speed drive, and gear mfg 12 100 1 481 069 2 787 931 115 969 61.1 122.4 9.6 0.047

333613 Mechanical power transmission equipment manufacturing 13 718 1 796 014 3 300 479 378 400 62.8 130.9 27.6 0.137

333618 Other engine equipment manufacturing 37 416 5 142 936 17 501 433 -281 594 66.2 137.5 -7.5 -0.017
95

Number of 

Employees

Value Added 

($1000)

Total Value of 

Shipments 

($1000)

Net Income 

($1000)

Compensation 

per Employee 

($1000)

Value Added 

per Employee 

($1000)

Net Income 

per Employee 

($1000)

Net Income 

per 

Expenditure 

Dollar ($1000)

3339 Other general purpose machinery mfg 251 250 37 589 382 73 685 863 9 254 154 67.9 149.6 36.8 0.147

33391 Pump and compressor manufacturing 55 175 11 400 046 20 927 621 4 186 622 76.2 206.6 75.9 0.249

333911 Pump and pumping equipment manufacturing 31 108 6 167 791 11 461 531 1 965 195 77.7 198.3 63.2 0.214

333912 Air and gas compressor manufacturing 19 866 4 558 489 8 375 152 2 057 085 75.9 229.5 103.5 0.308

333913 Measuring and dispensing pump manufacturing 4 201 673 766 1 090 937 164 343 66.6 160.4 39.1 0.179

33392 Material handling equipment manufacturing 73 853 10 950 707 23 479 360 3 314 426 61.0 148.3 44.9 0.167

33392M Material handling equipment manufacturing 73 853 10 950 707 23 479 360 3 314 426 61.0 148.3 44.9 0.167

33399 All other general purpose machinery manufacturing 122 223 15 238 628 29 278 883 1 753 107 68.3 124.7 14.3 0.066

333991 Power-driven hand tool manufacturing 5 032 822 091 1 563 263 369 862 56.6 163.4 73.5 0.337

333993 Packaging machinery manufacturing 17 451 2 052 170 4 127 960 95 187 74.6 117.6 5.5 0.024

333994 Industrial process furnace and oven manufacturing 9 766 1 116 524 2 071 558 154 303 65.4 114.3 15.8 0.083

33399N Fluid power equipment manufacturing 29 148 3 449 954 6 965 101 171 745 71.2 118.4 5.9 0.027

33399P All other miscellaneous general purpose machinery mfg 60 826 7 797 889 14 551 000 962 011 66.5 128.2 15.8 0.073

334 Computer & electronic product mfg 908 299 193 242 334 327 991 364 51 326 615 84.5 212.8 56.5 0.194

3341 Computer & peripheral equipment mfg 90 407 25 973 603 52 530 237 11 156 089 72.6 287.3 123.4 0.277

33411 Computer and peripheral equipment manufacturing 90 407 25 973 603 52 530 237 11 156 089 72.6 287.3 123.4 0.277

334111 Electronic computer manufacturing 39 640 18 163 961 36 155 504 10 003 285 82.1 458.2 252.4 0.390

334112 Computer storage device manufacturing 13 683 3 195 160 6 321 021 753 694 67.8 233.5 55.1 0.141

334113 Computer terminal manufacturing 1 678 217 110 467 003 21 272 89.2 129.4 12.7 0.048

334119 Other computer peripheral equipment manufacturing 35 406 4 397 372 9 586 709 377 839 63.1 124.2 10.7 0.043

3342 Communications equipment mfg 115 293 24 940 758 45 164 081 6 546 738 89.3 216.3 56.8 0.172

33421 Telephone apparatus manufacturing 23 938 3 637 637 8 551 513 548 649 77.4 152.0 22.9 0.070

334210 Telephone apparatus manufacturing 23 938 3 637 637 8 551 513 548 649 77.4 152.0 22.9 0.070

33422 Broadcasting and wireless communications equipment mfg 76 502 19 002 222 32 610 694 5 415 116 95.9 248.4 70.8 0.202

334220 Broadcasting and wireless communications equipment mfg 76 502 19 002 222 32 610 694 5 415 116 95.9 248.4 70.8 0.202

33429 Other communications equipment manufacturing 14 853 2 300 898 4 001 873 582 974 74.2 154.9 39.2 0.173

334290 Other communications equipment manufacturing 14 853 2 300 898 4 001 873 582 974 74.2 154.9 39.2 0.173

3343 Audio & video equipment mfg 10 283 1 463 934 3 275 474 -269 072 61.0 142.4 -26.2 -0.081

33431 Audio and video equipment manufacturing 10 283 1 463 934 3 275 474 -269 072 61.0 142.4 -26.2 -0.081

334310 Audio and video equipment manufacturing 10 283 1 463 934 3 275 474 -269 072 61.0 142.4 -26.2 -0.081

3344 Semiconductor & other electronic component mfg 293 537 58 360 636 96 459 857 13 056 896 71.9 198.8 44.5 0.173

33441 Semiconductor and other electronic component manufacturing 293 537 58 360 636 96 459 857 13 056 896 71.9 198.8 44.5 0.173
96

Number of 

Employees

Value Added 

($1000)

Total Value of 

Shipments 

($1000)

Net Income 

($1000)

Compensation 

per Employee 

($1000)

Value Added 

per Employee 

($1000)

Net Income 

per Employee 

($1000)

Net Income 

per 

Expenditure 

Dollar ($1000)

334411 Electron tube manufacturing 4 992 591 801 1 106 990 -24 634 70.8 118.5 -4.9 -0.023

334412 Bare printed circuit board manufacturing 24 772 2 101 606 3 749 722 102 827 50.9 84.8 4.2 0.029

334413 Semiconductor and related device manufacturing 120 257 41 433 504 59 240 375 11 930 457 92.3 344.5 99.2 0.292

334414 Electronic capacitor manufacturing 6 108 499 912 824 102 25 809 48.7 81.8 4.2 0.035

334415 Electronic resistor manufacturing 3 876 339 677 548 694 -11 329 54.7 87.6 -2.9 -0.022

334416 Electronic coil, transformer, and other inductor manufacturing 10 029 773 421 1 687 131 7 979 51.2 77.1 0.8 0.005

334417 Electronic connector manufacturing 19 424 2 575 532 3 987 346 652 273 61.7 132.6 33.6 0.208

334418 Printed circuit assembly (electronic assembly) manufacturing 59 171 5 455 307 17 332 394 388 101 58.1 92.2 6.6 0.024

334419 Other electronic component manufacturing 44 910 4 589 874 7 983 103 -1 471 60.5 102.2 0.0 0.000

3345 Navigational, measuring, medical, & control instruments mfg 375 344 79 359 432 125 081 153 20 331 363 97.9 211.4 54.2 0.198

33451 Navigational, measuring, medical, and control instruments mfg 375 344 79 359 432 125 081 153 20 331 363 97.9 211.4 54.2 0.198

334510 Electromedical and electrotherapeutic apparatus manufacturing 63 926 16 469 553 24 913 089 5 157 889 98.7 257.6 80.7 0.267

334511 Search, detection, and navigation system and instrument mfg 142 920 33 399 152 50 552 170 10 000 996 111.4 233.7 70.0 0.249

334512 Automatic environmental control manufacturing 10 646 1 476 840 2 474 232 378 049 68.2 138.7 35.5 0.184

334513 Industrial process variable instruments 32 563 4 772 189 7 688 300 685 862 73.8 146.6 21.1 0.101

334514 Totalizing fluid meter and counting device manufacturing 12 384 2 323 936 4 961 859 813 849 74.2 187.7 65.7 0.197

334515 Electricity and signal testing instrument manufacturing 31 163 5 233 149 7 987 445 167 041 93.9 167.9 5.4 0.022

334516 Analytical laboratory instrument manufacturing 36 827 7 687 180 12 177 335 1 244 580 95.3 208.7 33.8 0.116

334517 Irradiation apparatus manufacturing 14 361 2 989 021 6 036 626 703 942 107.4 208.1 49.0 0.133

334518 Watch, clock, and parts manufacturing 1 678 186 132 330 417 - 59.7 110.9 - -

334519 Other measuring and controlling device manufacturing 28 876 4 822 280 7 959 681 1 154 040 83.1 167.0 40.0 0.176

3346 Mfg & reproducing magnetic & optical media 23 436 3 143 970 5 480 561 504 596 62.2 134.2 21.5 0.108

33461 Manufacturing and reproducing magnetic and optical media 23 436 3 143 970 5 480 561 504 596 62.2 134.2 21.5 0.108

334611 Software reproducing 2 498 355 831 624 192 - 60.7 142.4 - -

334612 Audio and video media reproducing 14 973 2 047 940 2 811 913 638 754 50.4 136.8 42.7 0.320

334613 Magnetic and optical recording media manufacturing 5 965 740 199 2 044 456 - 92.5 124.1 - -

335 Electrical equipment, appliance, & component mfg 352 940 50 498 178 106 650 713 13 768 428 61.8 143.1 39.0 0.155

3351 Electric lighting equipment mfg 47 784 5 814 469 11 540 560 739 537 58.5 121.7 15.5 0.071

33511 Electric lamp bulb and parts manufacturing 7 719 957 935 1 941 446 -56 916 73.3 124.1 -7.4 -0.030

335110 Electric lamp bulb and parts manufacturing 7 719 957 935 1 941 446 -56 916 73.3 124.1 -7.4 -0.030

33512 Lighting fixture manufacturing 40 065 4 856 534 9 599 114 796 454 55.7 121.2 19.9 0.094

33512M Lighting fixture manufacturing 40 065 4 856 534 9 599 114 796 454 55.7 121.2 19.9 0.094
97

Number of 

Employees

Value Added 

($1000)

Total Value of 

Shipments 

($1000)

Net Income 

($1000)

Compensation 

per Employee 

($1000)

Value Added 

per Employee 

($1000)

Net Income 

per Employee 

($1000)

Net Income 

per 

Expenditure 

Dollar ($1000)

3352 Household appliance mfg 48 581 8 451 085 18 707 942 3 289 821 55.6 174.0 67.7 0.227

33521 Small electrical appliance manufacturing 10 676 1 883 992 3 875 919 549 109 52.0 176.5 51.4 0.189

33521M Small electrical appliance manufacturing 10 676 1 883 992 3 875 919 549 109 52.0 176.5 51.4 0.189

33522 Major appliance manufacturing 37 905 6 567 093 14 832 023 2 740 713 56.6 173.3 72.3 0.237

335221 Household cooking appliance manufacturing 10 014 1 438 911 3 835 185 540 600 47.6 143.7 54.0 0.176

335222 Household refrigerator and home freezer manufacturing 10 449 1 707 879 3 649 074 704 189 62.4 163.4 67.4 0.247

335224 Household laundry equipment manufacturing 7 927 1 295 279 3 357 541 - 57.3 163.4 - -

335228 Other major household appliance manufacturing 9 516 2 125 024 3 990 223 - 59.1 223.3 - -

3353 Electrical equipment mfg 124 722 17 929 414 36 420 717 5 816 333 62.5 143.8 46.6 0.198

33531 Electrical equipment manufacturing 124 722 17 929 414 36 420 717 5 816 333 62.5 143.8 46.6 0.198

335311 Power, distribution, and specialty transformer manufacturing 19 185 2 891 941 5 989 002 837 196 60.3 150.7 43.6 0.169

335312 Motor and generator manufacturing 37 640 5 098 260 10 855 168 1 851 752 55.3 135.4 49.2 0.217

335313 Switchgear and switchboard apparatus manufacturing 33 917 5 289 214 10 598 214 1 689 870 68.2 155.9 49.8 0.195

335314 Relay and industrial control manufacturing 33 980 4 649 998 8 978 333 1 437 516 66.2 136.8 42.3 0.199

3359 Other electrical equipment & component mfg 131 852 18 303 209 39 981 495 3 922 735 64.5 138.8 29.8 0.114

33591 Battery manufacturing 25 666 4 187 587 9 220 680 1 693 654 61.7 163.2 66.0 0.236

335911 Storage battery manufacturing 18 430 2 379 930 5 508 397 577 409 59.6 129.1 31.3 0.124

335912 Primary battery manufacturing 7 235 1 807 657 3 712 283 1 116 249 66.9 249.8 154.3 0.442

33592 Communication and energy wire and cable manufacturing 29 566 3 969 359 11 404 357 966 411 60.7 134.3 32.7 0.095

33592M Communication and energy wire and cable manufacturing 29 566 3 969 359 11 404 357 966 411 60.7 134.3 32.7 0.095

33593 Wiring device manufacturing 39 558 5 490 955 9 901 061 1 595 780 58.8 138.8 40.3 0.204

33593M Wiring device manufacturing 39 558 5 490 955 9 901 061 1 595 780 58.8 138.8 40.3 0.204

33599 All other electrical equipment and component manufacturing 37 063 4 655 309 9 455 398 -333 112 75.5 125.6 -9.0 -0.036

335991 Carbon and graphite product manufacturing 7 790 874 379 1 982 585 -186 283 62.2 112.2 -23.9 -0.093

335999 All other miscellaneous electrical equipment mfg 29 273 3 780 930 7 472 813 -146 827 79.1 129.2 -5.0 -0.020

336 Transportation equipment mfg 1 240 320 229 642 082 545 018 370 65 962 476 78.9 185.1 53.2 0.141

3361 Motor vehicle mfg 123 484 41 968 097 149 900 446 19 353 433 93.6 339.9 156.7 0.154

33611 Automobile and light duty motor vehicle manufacturing 101 510 38 798 362 134 129 035 18 707 916 98.0 382.2 184.3 0.168

336111 Automobile manufacturing 51 440 13 338 967 53 724 061 3 335 421 95.8 259.3 64.8 0.069

336112 Light truck and utility vehicle manufacturing 50 070 25 459 395 80 404 974 15 372 495 100.1 508.5 307.0 0.245

33612 Heavy duty truck manufacturing 21 974 3 169 734 15 771 411 645 516 73.7 144.2 29.4 0.044

336120 Heavy duty truck manufacturing 21 974 3 169 734 15 771 411 645 516 73.7 144.2 29.4 0.044
98

Number of 

Employees

Value Added 

($1000)

Total Value of 

Shipments 

($1000)

Net Income 

($1000)

Compensation 

per Employee 

($1000)

Value Added 

per Employee 

($1000)

Net Income 

per Employee 

($1000)

Net Income 

per 

Expenditure 

Dollar ($1000)

3362 Motor vehicle body & trailer mfg 89 012 6 877 283 21 289 121 5 190 49.9 77.3 0.1 0.000

33621 Motor vehicle body and trailer manufacturing 89 012 6 877 283 21 289 121 5 190 49.9 77.3 0.1 0.000

336211 Motor vehicle body manufacturing 37 561 3 099 055 9 571 235 -111 467 54.0 82.5 -3.0 -0.012

336212 Truck trailer manufacturing 17 781 1 341 215 4 094 631 68 530 47.1 75.4 3.9 0.018

336213 Motor home manufacturing 6 889 454 220 1 715 710 -37 815 47.9 65.9 -5.5 -0.023

336214 Travel trailer and camper manufacturing 26 781 1 982 792 5 907 545 85 943 46.6 74.0 3.2 0.015

3363 Motor vehicle parts mfg 403 660 51 569 867 130 520 776 5 401 701 62.5 127.8 13.4 0.046

33631 Motor vehicle gasoline engine and engine parts manufacturing 43 338 6 673 109 16 122 589 983 186 70.1 154.0 22.7 0.070

33631M Motor vehicle gasoline engine and engine parts manufacturing 43 338 6 673 109 16 122 589 983 186 70.1 154.0 22.7 0.070

33632 Motor vehicle electrical and electronic equipment mfg 51 816 6 250 356 13 796 310 483 295 65.1 120.6 9.3 0.038

33632M Motor vehicle electrical and electronic equipment mfg 51 816 6 250 356 13 796 310 483 295 65.1 120.6 9.3 0.038

33633 Motor vehicle steering and suspension component mfg 33 338 3 032 241 8 092 743 -83 538 54.7 91.0 -2.5 -0.011

336330 Motor vehicle steering and suspension component mfg 33 338 3 032 241 8 092 743 -83 538 54.7 91.0 -2.5 -0.011

33634 Motor vehicle brake system manufacturing 20 021 2 994 044 7 541 072 890 961 55.7 149.5 44.5 0.142

336340 Motor vehicle brake system manufacturing 20 021 2 994 044 7 541 072 890 961 55.7 149.5 44.5 0.142

33635 Motor vehicle transmission and power train parts mfg 46 946 9 417 340 21 046 860 1 385 509 85.1 200.6 29.5 0.076

336350 Motor vehicle transmission and power train parts mfg 46 946 9 417 340 21 046 860 1 385 509 85.1 200.6 29.5 0.076

33636 Motor vehicle seating and interior trim manufacturing 37 555 3 906 049 12 941 768 283 320 56.3 104.0 7.5 0.023

336360 Motor vehicle seating and interior trim manufacturing 37 555 3 906 049 12 941 768 283 320 56.3 104.0 7.5 0.023

33637 Motor vehicle metal stamping 65 146 7 562 837 17 738 909 383 861 63.8 116.1 5.9 0.024

336370 Motor vehicle metal stamping 65 146 7 562 837 17 738 909 383 861 63.8 116.1 5.9 0.024

33639 Other motor vehicle parts manufacturing 105 501 11 733 891 33 240 525 1 075 104 53.1 111.2 10.2 0.035

336391 Motor vehicle air-conditioning manufacturing 11 201 903 056 3 539 306 -317 057 56.8 80.6 -28.3 -0.087

336399 All other miscellaneous motor vehicle parts manufacturing 94 300 10 830 835 29 701 219 1 392 161 52.7 114.9 14.8 0.052

3364 Aerospace product & parts mfg 429 777 99 173 054 178 924 241 35 161 491 99.3 230.8 81.8 0.238

33641 Aerospace product and parts manufacturing 429 777 99 173 054 178 924 241 35 161 491 99.3 230.8 81.8 0.238

336411 Aircraft manufacturing 182 045 49 349 285 95 409 243 19 771 945 104.7 271.1 108.6 0.248

336412 Aircraft engine and engine parts manufacturing 63 393 14 726 478 29 573 759 5 755 190 88.3 232.3 90.8 0.252

336413 Other aircraft parts and auxiliary equipment manufacturing 110 853 21 622 751 32 050 688 8 248 127 84.1 195.1 74.4 0.341

336414 Guided missile and space vehicle manufacturing 50 338 9 646 809 16 141 661 758 293 128.9 191.6 15.1 0.047

336415 Space vehicle propulsion unit and propulsion unit parts mfg 15 486 3 076 885 4 521 328 773 901 103.1 198.7 50.0 0.216

336419 Other guided missile and space vehicle parts manufacturing 7 662 750 847 1 227 563 -145 963 79.4 98.0 -19.1 -0.111
99

Number of 

Employees

Value Added 

($1000)

Total Value of 

Shipments 

($1000)

Net Income 

($1000)

Compensation 

per Employee 

($1000)

Value Added 

per Employee 

($1000)

Net Income 

per Employee 

($1000)

Net Income 

per 

Expenditure 

Dollar ($1000)

3365 Railroad rolling stock mfg 25 078 4 352 692 12 019 211 1 055 417 77.0 173.6 42.1 0.098

33651 Railroad rolling stock manufacturing 25 078 4 352 692 12 019 211 1 055 417 77.0 173.6 42.1 0.098

336510 Railroad rolling stock manufacturing 25 078 4 352 692 12 019 211 1 055 417 77.0 173.6 42.1 0.098

3366 Ship & boat building 126 824 16 322 216 27 247 521 1 021 226 69.8 128.7 8.1 0.040

33661 Ship and boat building 126 824 16 322 216 27 247 521 1 021 226 69.8 128.7 8.1 0.040

336611 Ship building and repairing 100 372 14 125 452 21 801 484 1 468 171 75.7 140.7 14.6 0.074

336612 Boat building 26 453 2 196 764 5 446 037 -446 947 47.5 83.0 -16.9 -0.082

3369 Other transportation equipment mfg 42 485 9 378 874 25 117 054 3 964 019 75.9 220.8 93.3 0.192

33699 Other transportation equipment manufacturing 42 485 9 378 874 25 117 054 3 964 019 75.9 220.8 93.3 0.192

336991 Motorcycle, bicycle, and parts manufacturing 10 506 2 456 478 5 097 019 924 983 63.7 233.8 88.0 0.236

336992 Military armored vehicle, tank, and tank component mfg 20 285 5 222 991 14 807 987 2 807 727 87.4 257.5 138.4 0.237

336999 All other transportation equipment manufacturing 11 695 1 699 406 5 212 048 231 308 66.9 145.3 19.8 0.048
100
101

Appendix D: Schematic Data Map (ASM)

The Annual Survey of Manufactures (ASM) is conducted every year except for years 

ending in 2 or 7 when the Economic Census is conducted. The ASM provides statistics 

on employment, payroll, supplemental labor costs, cost of materials consumed, operating 

expenses, value of shipments, value added, fuels and energy used, and inventories. It uses 

a sample survey of approximately 50 000 establishments with new samples selected at 5-

year intervals. The ASM data allows the examination of multiple factors (value added, 

payroll, energy use, and more) of manufacturing at a detailed subsector level. The 

Economic Census, used for years ending in 2 or 7, is a survey of all employer 

establishments in the U.S. that has been taken as an integrated program at 5-year intervals 

since 1967. Both the ASM and the Economic Census use NAICS classification; however, 

prior to NAICS the Standard Industrial Classification system was used.

Table D.1 contains items from the Annual Survey of Manufactures. The color scheme 

matches that of the color scheme in the manufacturing supply chains in Tables D.2 

through D.7 indicating that the items in the table were used to calculate the items in the 

schematic. For example, the items labeled in green in Table D.1 are used to calculate the 

items in green in Table D.2. Table D.2 contains the entirety of the manufacturing industry 

while D.3 through D.7 are a selection of sectors. The sectors were chosen based on being 

related to the medium- and high-technology manufacturing industry.
102

Table D.1: Supply Chain Components

ASM Data Item Schematic name

Number of employees Payroll, Benefits, and employment

Annual payroll Payroll, Benefits, and employment

Total fringe benefits Payroll, Benefits, and employment

Employer's cost for health insurance 

Employer's cost for defined benefit pension plans 

Employer's cost for defined contribution plans 

Employer's cost for other fringe benefits 

Production workers avg per year

Production workers hours (1,000)

Production workers wages 

Total cost of materials 

Materials, parts, containers, packaging, etc. used Materials, parts, containers, packaging, etc used

Cost of resales Contract work and resales

Contract work Contract work and resales

Cost of purchased fuels Purchased fuels and electricity

Purchased electricity Purchased fuels and electricity

Quantity of electricity purchased

Quantity of generated electricity 

Quantity of electricity sold or transferred 

Total value of shipments Shipments

Value of products shipments 

Total miscellaneous receipts 

Value of resales 

Contract receipts 

Other miscellaneous receipts 

Value of interplant transfers 

Value added Value added

Total EOY inventories 

Finished goods inventories, EOY Net Inventories Shipped

Work-in-process inventories, EOY Net Inventories Shipped

Materials and supplies inventories, EOY 

Total BOY inventories 

Finished goods inventories, BOY Net Inventories Shipped

Work-in-process inventories, BOY Net Inventories Shipped

Materials and supplies inventories, BOY 

Total capital expenditures (new and used) 

Capital expenditures: buildings & other structures (new and used) Capital expenditures: buildings and other structures (new and used)

Capital expenditures: machinery and equipment (new and used) 

Capital expenditures: autos, trucks, etc. for highway use Capital expenditures: machinery and equipment (new and used)

Capital expenditures: computer and data processing equipment Computer hardware, software, and other equipment

Capital expenditures: all other machinery and equipment Capital expenditures: machinery and equipment (new and used)

Total depreciation Depreciation

Total rental payments 

Buildings rentals Capital expenditures: buildings and other structures (new and used): Rental

Machinery rentals Capital expenditures: machinery and equipment (new and used): Rental

Total other expenses 

Temporary staff and leased employee expenses Other costs

Expensed computer hardware and other equipment Computer hardware, software, and other equipment

Expensed purchases of software Computer hardware, software, and other equipment

Data processing and other purchased computer services Professional, technical, and data services

Communication services Communication services

Repair and maintenance services of buildings and/or machinery Maintenance and repair

Refuse removal (including hazardous waste) services Refuse removal

Advertising and promotional services Other costs

Purchased professional and technical services Professional, technical, and data services

Taxes and license fees Other costs

All other expenses Other costs

Volume of Production=total costs (blue plus orange plus red plus green plus gold)

Net Inventories Shipped=sum of EOY finished goods and work-in-process inventories less the sum of BOY finished goods and work-in-process inventories
103

Table D.2: Manufacturing Supply Chain
104

Table D.3: Manufacturing Supply Chain, NAICS 325: Chemical Manufacturing
105

Table D.4: Manufacturing Supply Chain, NAICS 333: Machinery Manufacturing
106

Table D.5: Manufacturing Supply Chain, NAICS 334: Computer and Electronic Product Manufacturing
107

Table D.6: Manufacturing Supply Chain, NAICS 335: Electrical Equipment, Appliance, and Component Manufacturing
108

Table D.7: Manufacturing Supply Chain, NAICS 336: Transportation Equipment Manufacturing
109

Appendix E: Glossary of Terms

Each dataset used in this report contains a set of terms to describe the boundaries of the 

data. A single term does not fully describe what the dataset includes and different 

organizations may define terms differently. Data from the Bureau of Economic Analysis, 

for example, defines value added differently than the Annual Survey of Manufactures. In 

order to understand these datasets completely, the terms describing them must be defined. 

Some datasets contain a significant number of inter-related variables, each being 

described with unique terms. The manufacturing supply chain in Table D.1, for instance, 

contains data from the Annual Survey of Manufactures. This dataset contains numerous 

terms, which need to be defined so the reader can understand the inter-relationships of the 

data and the meaning of the data. This section provides definitions for the various terms 

used in this report and in doing so outlines many of the inter-relationships in various 

datasets. Definitions of terms used by specific organizations are taken verbatim from the 

source and have the organization or data source name in parentheses. Terms specific to 

this report have the location in the report where they are used. The sources for definitions 

include the following:

Annual Survey of Manufactures (ASM). 

<http://www.census.gov/manufacturing/asm/index.html>

Bureau of Economic Analysis (BEA). Horowitz, Karen J. and Mark A. Planting. (2009) 

Concepts and Methods of the U.S. Input-Output Accounts. Bureau of Economic 

Analysis. <http://www.bea.gov/papers/pdf/IOmanual_092906.pdf>

Organization for Economic Co-operation and Development (OECD). “StatExtracts.” 

<http://stats.oecd.org/Index.aspx>

United Nations Statistics Division (UNSD). “National Accounts Main Aggregates 

Database.” <http://unstats.un.org/unsd/snaama/Introduction.asp>

U.S. Census Bureau. “Manufacturers’ Shipments, Inventories, and Orders.” 

<http://www.census.gov/manufacturing/m3/>

Advertising and promotional services (ASM): Included in the cost of selected 

advertising and promotional services are payments made to other companies for 

these services which were paid directly by the establishment. These include 

payments for printing, media coverage, and other services and materials. Excluded 

are the salaries paid to employees of this establishment for these services.

All other expenses (ASM): Included in the cost of all other expenses are payments 

made to other companies for services other than those listed elsewhere. These 

include, but are not limited to, items such as insurance, travel, training, 

transportation and office supplies.
110

Annual payroll (ASM): This item includes the gross earnings of all employees on 

the payrolls of operating manufacturing establishments paid in the calendar year. 

Respondents are told they could follow the definition of payrolls used for calculating 

the federal withholding tax. It includes all forms of compensation, such as salaries, 

wages, commissions, dismissal pay, bonuses, vacation and sick leave pay, and 

compensation in kind, prior to such deductions as employees' social security 

contributions, withholding taxes, group insurance, union dues, and savings bonds. 

The total includes salaries of officers of corporations; it excludes payments to 

proprietors or partners of unincorporated concerns. Also excluded are payments to 

members of Armed Forces and pensioners carried on the active payrolls of 

manufacturing establishments.

The census definition of payrolls is identical to that recommended to all federal 

statistical agencies by the Office of Management and Budget. It should be noted that 

this definition does not include employers' social security contributions or other 

nonpayroll labor costs, such as employees' pension plans, group insurance 

premiums, and workers' compensation.

Note: Beginning with the 2006 ASM, for employment and related fields (payroll, 

production hours, benefits), respondents were asked to report only those full- and 

part-time employees whose payroll was reported on the IRS Form 941 filing for the 

Employer Identification Number (EIN) used by that manufacturing establishment. 

Other temporary workers and workers whose payroll was reported under a different 

company's EIN were reported elsewhere on the form. In 2002, these data constituted 

between 1 and 1 1/2% of the total for these fields. Comparisons with data prior to 

2006 should be used with caution.

Buildings rentals (ASM): This item includes rental payments for the use of all 

items for which depreciation reserves would be maintained if they were owned by 

the establishment, e.g., structures and buildings, and production, office, and 

transportation equipment. Excluded are royalties and other payments for the use of 

intangibles and depletable assets and land rents where separable.

When an establishment of a multiestablishment company was charged rent by 

another part of the same company for the use of assets owned by the company, it 

was instructed to exclude that cost from rental payments.

If there were assets at an establishment rented from another company and the rents 

were paid centrally by the head office of the establishment, the company was 

instructed to report these rental payments as if they were paid directly by the 

establishment.

Capital expenditures: all other machinery and equipment (ASM): Represents 

the total new and used capital expenditures reported by establishments in operation 

and any known plants under construction.
111

These data include expenditures for:

1. Permanent additions and major alterations to manufacturing and mining 

establishments.

2. New and used machinery and equipment used for replacement and additions to 

plant capacity, if they are of the type for which depreciation, depletion, or (for 

mining establishments) Office of Minerals Exploration accounts are ordinarily 

maintained. In addition, for mining establishments, these data include 

expenditures made during the year for development and exploration of mineral 

properties. For manufacturing establishments, these data are broken down into 

three types: 

a. Automobiles, trucks, etc. for highway use. These include vehicles 

acquired under a lease-purchase agreement and exclude vehicles leased or 

normally designed to transport materials, property, or equipment on 

mining, construction, petroleum development, and similar projects. These 

vehicles are of such size or weight as to be normally restricted by state 

laws or regulations from operating on public highways. Also excluded are 

vehicles that are purchased by a company for highway use. 

b. Computers and peripheral data processing equipment. This item includes 

all purchases of computers and related equipment. 

c. All other expenditures for machinery and equipment excluding 

automobiles and computer equipment. 

Capital expenditures include work done by contract, as well as by the 

establishment's own workforce.

These data exclude expenditures for land and mineral rights and cost of maintenance 

and repairs charged as current operating expenses.

Capital expenditures: autos, trucks, etc. for highway use (ASM): Represents the 

total new and used capital expenditures reported by establishments in operation and 

any known plants under construction.

These data include expenditures for:

1. Permanent additions and major alterations to manufacturing and mining 

establishments.

2. New and used machinery and equipment used for replacement and additions to 

plant capacity, if they are of the type for which depreciation, depletion, or (for 

mining establishments) Office of Minerals Exploration accounts are ordinarily 

maintained. In addition, for mining establishments, these data include 

expenditures made during the year for development and exploration of mineral 

properties. For manufacturing establishments, these data are broken down into 

three types: 

a. Automobiles, trucks, etc. for highway use. These include vehicles 

acquired under a lease-purchase agreement and exclude vehicles leased or 
112

normally designed to transport materials, property, or equipment on 

mining, construction, petroleum development, and similar projects. These 

vehicles are of such size or weight as to be normally restricted by state 

laws or regulations from operating on public highways. Also excluded are 

vehicles that are purchased by a company for highway use. 

b. Computers and peripheral data processing equipment. This item includes 

all purchases of computers and related equipment. 

c. All other expenditures for machinery and equipment excluding 

automobiles and computer equipment. 

Capital expenditures include work done by contract, as well as by the 

establishment's own workforce.

These data exclude expenditures for land and mineral rights and cost of maintenance 

and repairs charged as current operating expenses.

Capital expenditures: buildings and other structures (new and used) (ASM): 

Represents the total new and used capital expenditures reported by establishments in 

operation and any known plants under construction.

These data include expenditures for:

1. Permanent additions and major alterations to manufacturing and mining 

establishments.

2. New and used machinery and equipment used for replacement and additions to 

plant capacity, if they are of the type for which depreciation, depletion, or (for 

mining establishments) Office of Minerals Exploration accounts are ordinarily 

maintained. In addition, for mining establishments, these data include 

expenditures made during the year for development and exploration of mineral 

properties. For manufacturing establishments, these data are broken down into 

three types: 

a. Automobiles, trucks, etc. for highway use. These include vehicles 

acquired under a lease-purchase agreement and exclude vehicles leased or 

normally designed to transport materials, property, or equipment on 

mining, construction, petroleum development, and similar projects. These 

vehicles are of such size or weight as to be normally restricted by state 

laws or regulations from operating on public highways. Also excluded are 

vehicles that are purchased by a company for highway use. 

b. Computers and peripheral data processing equipment. This item includes 

all purchases of computers and related equipment. 

c. All other expenditures for machinery and equipment excluding 

automobiles and computer equipment. 

Capital expenditures include work done by contract, as well as by the 

establishment's own workforce.
113

These data exclude expenditures for land and mineral rights and cost of maintenance 

and repairs charged as current operating expenses.

Capital expenditures: buildings and other structures (new and used) (Figure 

4.5): This item is the sum of capital expenditures: buildings and other structures 

(new and used) and buildings rentals from the ASM.

Capital expenditures: computer and data processing equipment (ASM): 

Represents the total new and used capital expenditures reported by establishments in 

operation and any known plants under construction.

These data include expenditures for:

1. Permanent additions and major alterations to manufacturing and mining 

establishments.

2. New and used machinery and equipment used for replacement and additions to 

plant capacity, if they are of the type for which depreciation, depletion, or (for 

mining establishments) Office of Minerals Exploration accounts are ordinarily 

maintained. In addition, for mining establishments, these data include 

expenditures made during the year for development and exploration of mineral 

properties. For manufacturing establishments, these data are broken down into 

three types: 

a. Automobiles, trucks, etc. for highway use. These include vehicles 

acquired under a lease-purchase agreement and exclude vehicles leased or 

normally designed to transport materials, property, or equipment on 

mining, construction, petroleum development, and similar projects. These 

vehicles are of such size or weight as to be normally restricted by state 

laws or regulations from operating on public highways. Also excluded are 

vehicles that are purchased by a company for highway use. 

b. Computers and peripheral data processing equipment. This item includes 

all purchases of computers and related equipment. 

c. All other expenditures for machinery and equipment excluding 

automobiles and computer equipment. 

Capital expenditures include work done by contract, as well as by the 

establishment's own workforce.

These data exclude expenditures for land and mineral rights and cost of maintenance 

and repairs charged as current operating expenses.

Capital expenditures: machinery and equipment (new and used) (ASM):

Represents the total new and used capital expenditures reported by establishments in 

operation and any known plants under construction.

These data include expenditures for:
114

1. Permanent additions and major alterations to manufacturing and mining 

establishments.

2. New and used machinery and equipment used for replacement and additions to 

plant capacity, if they are of the type for which depreciation, depletion, or (for 

mining establishments) Office of Minerals Exploration accounts are ordinarily 

maintained. In addition, for mining establishments, these data include 

expenditures made during the year for development and exploration of mineral 

properties. For manufacturing establishments, these data are broken down into 

three types: 

a. Automobiles, trucks, etc. for highway use. These include vehicles 

acquired under a lease-purchase agreement and exclude vehicles leased or 

normally designed to transport materials, property, or equipment on 

mining, construction, petroleum development, and similar projects. These 

vehicles are of such size or weight as to be normally restricted by state 

laws or regulations from operating on public highways. Also excluded are 

vehicles that are purchased by a company for highway use. 

b. Computers and peripheral data processing equipment. This item includes 

all purchases of computers and related equipment. 

c. All other expenditures for machinery and equipment excluding 

automobiles and computer equipment. 

Capital expenditures include work done by contract, as well as by the 

establishment's own workforce.

These data exclude expenditures for land and mineral rights and cost of maintenance 

and repairs charged as current operating expenses.

Capital expenditures: machinery and equipment (Figure 4.5): This item is the 

sum of the following items from the ASM: capital expenditures: autos, trucks, etc. 

for highway use, capital expenditures: all other machinery and equipment, and 

machinery rentals. 

Capital Gains (Table 2.1): An increase in the value of a capital asset

Capital Goods (Table 2.1): Human made goods used in the production of other 

goods.

Commodity (BEA): A commodity is a product or service. It may be produced by 

one or by many industries. Commodity output represents the total output of the 

product or service, regardless of the industry that produced it.

If an industry and the commodity produced by the industry have the same name, the 

commodity is considered to be the primary product of that industry. Any other 

commodity produced by that industry is a secondary product of that industry.
115

Communication services (ASM): Included in the cost of selected purchased 

services for communication are the actual expenses incurred or payable during the 

year for any type of communication. Such types of communication include 

telephone, data transmission, telegraph, Internet connectivity, fax, telex, photo 

transmission, paging, cellular telephone, online access and related services, etc.

Computer hardware, software, and other equipment (Figure 4.5): This item is 

the sum of Expensed computer hardware and other equipment, expensed purchases 

of software, and capital expenditures: computer and data processing equipment from 

the ASM.

Contract receipts (ASM): Miscellaneous receipts represent receipts from activities 

of the establishment other than the manufacturing of products from its own 

materials. Service activities such as installation, repair, and training are 

miscellaneous receipts. Assembly of products from materials owned by others and 

the sale of products bought and resold without further value added are other 

examples of miscellaneous receipts. Miscellaneous receipts are collected using the 

following categories:

1. Reported contract work - receipts for work or services that a plant performed for 

others on their materials. 

2. Value of resales - sales of products bought and sold without further manufacture, 

processing, or assembly. 

3. Other miscellaneous receipts - such as repair work, installation, sales of scrap, etc.

Contract work (ASM): This term refers to direct charges actually paid or payable 

for items consumed or put into production during the year, including freight charges 

and other direct charges incurred by the establishment in acquiring these materials. 

It includes the cost of materials or fuel consumed, whether purchased by the 

individual establishment from other companies, transferred to it from other 

establishments of the same company, or withdrawn from inventory during the year.

Included in this item are:

1. Cost of parts, components, containers, etc. Includes all raw materials, 

semifinished goods, parts, containers, scrap, and supplies put into production or 

used as operating supplies and for repair and maintenance during the year. 

2. Cost of products bought and sold in the same condition. 

3. Cost of fuels consumed for heat and power. Includes the cost of materials or fuel 

consumed, whether purchased by the individual establishment from other 

companies, transferred to it from other establishments of the same company, or 

withdrawn from inventory during the year. 

4. Cost of purchased electricity. The cost of purchased electric energy represents the 

amount actually used during the year for heat and power. In addition, information 

was collected on the quantity of electric energy generated by the establishment 
116

and the quantity of electric energy sold or transferred to other plants of the same 

company. 

5. Cost of contract work. This term applies to work done by others on materials 

furnished by the manufacturing establishment. The actual cost of the material is to 

be reported on the cost of materials, parts, and containers line of this item. The 

term "contract work" refers to the fee a company pays to another company to 

perform a service.

Contract work and resales (Figure 4.5): This item is the sum of the cost of resales 

and contract work from the ASM.

Cost of purchased fuels (ASM): This term refers to direct charges actually paid or 

payable for items consumed or put into production during the year, including freight 

charges and other direct charges incurred by the establishment in acquiring these 

materials. It includes the cost of materials or fuel consumed, whether purchased by 

the individual establishment from other companies, transferred to it from other 

establishments of the same company, or withdrawn from inventory during the year.

Included in this item are:

1. Cost of parts, components, containers, etc. Includes all raw materials, 

semifinished goods, parts, containers, scrap, and supplies put into production or 

used as operating supplies and for repair and maintenance during the year. 

2. Cost of products bought and sold in the same condition. 

3. Cost of fuels consumed for heat and power. Includes the cost of materials or fuel 

consumed, whether purchased by the individual establishment from other 

companies, transferred to it from other establishments of the same company, or 

withdrawn from inventory during the year. 

4. Cost of purchased electricity. The cost of purchased electric energy represents the 

amount actually used during the year for heat and power. In addition, information 

was collected on the quantity of electric energy generated by the establishment 

and the quantity of electric energy sold or transferred to other plants of the same 

company. 

5. Cost of contract work. This term applies to work done by others on materials 

furnished by the manufacturing establishment. The actual cost of the material is to 

be reported on the cost of materials, parts, and containers line of this item. The 

term "contract work" refers to the fee a company pays to another company to 

perform a service.

Cost of resales (ASM): This term refers to direct charges actually paid or payable 

for items consumed or put into production during the year, including freight charges 

and other direct charges incurred by the establishment in acquiring these materials. 

It includes the cost of materials or fuel consumed, whether purchased by the 

individual establishment from other companies, transferred to it from other 

establishments of the same company, or withdrawn from inventory during the year.
117

Included in this item are:

1. Cost of parts, components, containers, etc. Includes all raw materials, 

semifinished goods, parts, containers, scrap, and supplies put into production or 

used as operating supplies and for repair and maintenance during the year. 

2. Cost of products bought and sold in the same condition. 

3. Cost of fuels consumed for heat and power. Includes the cost of materials or fuel 

consumed, whether purchased by the individual establishment from other 

companies, transferred to it from other establishments of the same company, or 

withdrawn from inventory during the year. 

4. Cost of purchased electricity. The cost of purchased electric energy represents the 

amount actually used during the year for heat and power. In addition, information 

was collected on the quantity of electric energy generated by the establishment 

and the quantity of electric energy sold or transferred to other plants of the same 

company. 

5. Cost of contract work. This term applies to work done by others on materials 

furnished by the manufacturing establishment. The actual cost of the material is to 

be reported on the cost of materials, parts, and containers line of this item. The 

term "contract work" refers to the fee a company pays to another company to 

perform a service.

Data processing and other purchased computer services (ASM): Included in the 

cost of selected data processing and other purchased computer services are 

purchases of computer facilities management services, computer input preparation, 

data storage, computer time rental, optical scanning services, and other computerrelated advice and services, including training. Excluded are services such as 

expensed integrated systems, repair and maintenance of computer equipment, 

payroll processing and credit card transaction fees, and expenses for 

telecommunication services (e.g., Internet connectivity, telephone).

Economic Success (Table 2.1): A constant and suitable magnitude of production 

resulting in competitive benefits (profits, capital gains, income, and product 

utilization) for an industry’s stakeholders.

Employer’s cost for health insurance (ASM): This item is the employer's costs for 

social security tax, unemployment tax, workers' compensation insurance, state 

disability insurance pension plans, stock purchase plans, union-negotiated benefits, 

life insurance premiums, and insurance premiums on hospital and medical plans for 

employees. Also included are the employer's costs for benefits to individual 

employees such as stock purchase plans, deferred profit-sharing plans, and defined 

benefit and defined contribution retirement plans. They exclude such items as 

company-operated cafeterias, in-plant medical services, free parking lots, discounts 

on employee purchases, and uniforms and work clothing for employees.

These figures represent the total amount of employer-paid benefits for all categories 

shown, and are inclusive of payments made on behalf of individuals that may not be 
118

included in the current payroll values . Consequently, for some manufacturing 

industries, payroll and benefits values may not move in tandem when compared to 

prior year tabulation totals.

Note: Beginning with the 2006 ASM, for employment and related fields (payroll, 

production hours, benefits), respondents were asked to report only those full- and 

part-time employees whose payroll was reported on the IRS Form 941 filing for the 

Employer Identification Number (EIN) used by that manufacturing establishment. 

Other temporary workers and workers whose payroll was reported under a different 

company's EIN were reported elsewhere on the form. In 2002, these data constituted 

between 1 and 1 1/2% of the total for these fields. Comparisons with data prior to 

2006 should be used with caution.

Employer’s cost for defined benefit pension plans (ASM): This item is the 

employer's costs for social security tax, unemployment tax, workers' compensation 

insurance, state disability insurance pension plans, stock purchase plans, unionnegotiated benefits, life insurance premiums, and insurance premiums on hospital 

and medical plans for employees. Also included are the employer's costs for benefits 

to individual employees such as stock purchase plans, deferred profit-sharing plans, 

and defined benefit and defined contribution retirement plans. They exclude such 

items as company-operated cafeterias, in-plant medical services, free parking lots, 

discounts on employee purchases, and uniforms and work clothing for employees.

These figures represent the total amount of employer-paid benefits for all categories 

shown, and are inclusive of payments made on behalf of individuals that may not be 

included in the current payroll values . Consequently, for some manufacturing 

industries, payroll and benefits values may not move in tandem when compared to 

prior year tabulation totals.

Note: Beginning with the 2006 ASM, for employment and related fields (payroll, 

production hours, benefits), respondents were asked to report only those full- and 

part-time employees whose payroll was reported on the IRS Form 941 filing for the 

Employer Identification Number (EIN) used by that manufacturing establishment. 

Other temporary workers and workers whose payroll was reported under a different 

company's EIN were reported elsewhere on the form. In 2002, these data constituted 

between 1 and 1 1/2% of the total for these fields. Comparisons with data prior to 

2006 should be used with caution.

Employer’s cost for defined contribution plans (ASM): This item is the 

employer's costs for social security tax, unemployment tax, workers' compensation 

insurance, state disability insurance pension plans, stock purchase plans, unionnegotiated benefits, life insurance premiums, and insurance premiums on hospital 

and medical plans for employees. Also included are the employer's costs for benefits 

to individual employees such as stock purchase plans, deferred profit-sharing plans, 

and defined benefit and defined contribution retirement plans. They exclude such 
119

items as company-operated cafeterias, in-plant medical services, free parking lots, 

discounts on employee purchases, and uniforms and work clothing for employees.

These figures represent the total amount of employer-paid benefits for all categories 

shown, and are inclusive of payments made on behalf of individuals that may not be 

included in the current payroll values . Consequently, for some manufacturing 

industries, payroll and benefits values may not move in tandem when compared to 

prior year tabulation totals.

Note: Beginning with the 2006 ASM, for employment and related fields (payroll, 

production hours, benefits), respondents were asked to report only those full- and 

part-time employees whose payroll was reported on the IRS Form 941 filing for the 

Employer Identification Number (EIN) used by that manufacturing establishment. 

Other temporary workers and workers whose payroll was reported under a different 

company's EIN were reported elsewhere on the form. In 2002, these data constituted 

between 1 and 1 1/2% of the total for these fields. Comparisons with data prior to 

2006 should be used with caution.

Employer’s cost for other fringe benefits (ASM): This item is the employer's 

costs for social security tax, unemployment tax, workers' compensation insurance, 

state disability insurance pension plans, stock purchase plans, union-negotiated 

benefits, life insurance premiums, and insurance premiums on hospital and medical 

plans for employees. Also included are the employer's costs for benefits to 

individual employees such as stock purchase plans, deferred profit-sharing plans, 

and defined benefit and defined contribution retirement plans. They exclude such 

items as company-operated cafeterias, in-plant medical services, free parking lots, 

discounts on employee purchases, and uniforms and work clothing for employees.

These figures represent the total amount of employer-paid benefits for all categories 

shown, and are inclusive of payments made on behalf of individuals that may not be 

included in the current payroll values . Consequently, for some manufacturing 

industries, payroll and benefits values may not move in tandem when compared to 

prior year tabulation totals.

Note: Beginning with the 2006 ASM, for employment and related fields (payroll, 

production hours, benefits), respondents were asked to report only those full- and 

part-time employees whose payroll was reported on the IRS Form 941 filing for the 

Employer Identification Number (EIN) used by that manufacturing establishment. 

Other temporary workers and workers whose payroll was reported under a different 

company's EIN were reported elsewhere on the form. In 2002, these data constituted 

between 1 and 1 1/2% of the total for these fields. Comparisons with data prior to 

2006 should be used with caution.

Establishment (BEA): An economic unit—business or industrial—at a single 

physical location where business is conducted or where services or industrial 

operations are performed. Examples include a factory, mill, store, hotel, movie 
120

theater, mine, farm, ranch, bank, railroad depot, airline terminal, sales office, 

warehouse, or central administrative office. One or more establishments make up an 

enterprise or a company. However, a single establishment may be comprised of 

subunits, departments, or divisions. In the industry classification systems—SIC and 

NAICS— the establishment is the basic unit for collecting many types of economic 

information.

Expensed computer hardware and other equipment (ASM): Included in the cost 

of selected expensed computer hardware and other equipment are actual expenses 

incurred or payable during the year for this item. Purchases of copiers, fax machines, 

telephones, shop and lab equipment, CPUs, and monitors are all included. Excluded 

are services provided by other establishments of the same company (such as 

software and data processing services).

Expensed purchases of software (ASM): Included in the cost of selected expensed 

purchases of software are actual expenses incurred or payable during the year for 

this item. Purchases of software developed or customized by others, web-design 

services and purchases, licensing agreements, upgrades of software, and 

maintenance fees related to software upgrades and alterations are all included.

Financial Capital (Table 2.1): Funds provided by investors to purchase real capital 

equipment for production.

Final Product Utilization (Table 2.1): The utility gained from the end user of a 

product.

Finished goods inventories, BOY (ASM): Respondents were asked to report their 

beginning of year and end of year inventories at cost or market. Effective with the 

1982 Economic Census, this change to a uniform instruction for reporting 

inventories was introduced for all sector reports. Prior to 1982, respondents were 

permitted to value inventories using any generally accepted accounting method 

(FIFO, LIFO, or market, to name a few). Beginning in 1982, LIFO users were asked 

to first report inventory values prior to the LIFO adjustment and then to report the 

LIFO reserve and the LIFO value after adjustment for the reserve.

Inventory data by stage of fabrication

Total inventories and three detailed components were collected:

1. Finished goods

2. Work-in-process 

3. Materials, supplies, fuels, etc. 

Materials inventories refer to goods that are raw inputs to the manufacturing 

process, and that will be substantially altered to produce an establishment's output. 

Work-in-process inventories refer to goods that have been substantially transformed 
121

in the manufacturing process, but that are not yet the final output of the 

establishment. Finished goods are goods that represent the final output of the 

establishment, but that are still within ownership of the establishment.

When using inventory data by stage of fabrication for "all industries" and at the 

three-digit subsector level, it should be noted that an item treated as a finished 

product by an establishment in one industry may be reported as a raw material by an 

establishment in a different industry. For example, the finished product inventories 

of a steel mill would be reported as raw materials by a stamping plant. Such 

differences are present in the inventory figures by stage of fabrication shown for all 

publication levels.

Finished goods inventories, EOY (ASM): Respondents were asked to report their 

beginning of year and end of year inventories at cost or market. Effective with the 

1982 Economic Census, this change to a uniform instruction for reporting

inventories was introduced for all sector reports. Prior to 1982, respondents were 

permitted to value inventories using any generally accepted accounting method 

(FIFO, LIFO, or market, to name a few). Beginning in 1982, LIFO users were asked 

to first report inventory values prior to the LIFO adjustment and then to report the 

LIFO reserve and the LIFO value after adjustment for the reserve.

Inventory data by stage of fabrication 

Total inventories and three detailed components were collected:

1. Finished goods

2. Work-in-process 

3. Materials, supplies, fuels, etc. 

Materials inventories refer to goods that are raw inputs to the manufacturing 

process, and that will be substantially altered to produce an establishment's output. 

Work-in-process inventories refer to goods that have been substantially transformed 

in the manufacturing process, but that are not yet the final output of the 

establishment. Finished goods are goods that represent the final output of the 

establishment, but that are still within ownership of the establishment.

When using inventory data by stage of fabrication for "all industries" and at the threedigit subsector level, it should be noted that an item treated as a finished product by an 

establishment in one industry may be reported as a raw material by an establishment in a 

different industry. For example, the finished product inventories of a steel mill would be 

reported as raw materials by a stamping plant. Such differences are present in the 

inventory figures by stage of fabrication shown for all publication levels.

Final use (BEA): The consumption of the goods and services that are produced and 

distributed in the economy. In the I-O accounts, final-use transactions consist of the 

transactions that make up the final-expenditure components of GDP: Personal 
122

consumption expenditures; private fixed investment; change in private inventories; 

exports of goods and services; imports of goods and services; and Federal, state, and local 

government consumption expenditures and gross investment (including investment by 

government enterprises).

Gross Domestic Product (BEA): The market value of the goods and services produced 

by labor and property located within the borders of the United States. In 1991, GDP 

replaced gross national product (GNP) as the featured measure of U.S. production.

Gross operating surplus (Table 3.5 and Table 3.10): Gross output less a subset of costs 

(i.e., intermediate expenditures, compensation, and taxes less subsidies). It is similar to 

profit with the exception that it does not take into account the depreciation of capital.

Gross operating surplus (BEA): It is a profits-like measure that includes proprietors’ 

income, corporate profits, net interest, business transfer payments, etc. GOS can be 

calculated as gross output less (1) intermediate inputs, (2) employee compensation, and 

(3) “taxes on production and imports less subsidies.”

Intermediate Inputs (BEA): Purchases of goods and services—such as energy, 

materials, and purchased services—that are used for the production of other goods and 

services rather than for final consumption. These inputs are sometimes referred to as 

current-account expenditures. They do not include any capital-account purchases nor do 

they include the inputs from the primary factors of production (capital and labor) that are 

components of value added.

Labor (Table 2.1): Human effort used in production, which includes technical and 

marketing expertise.

Land (Table 2.1):Naturally-occurring goods such as water, air, soil, mineral, and flora 

used in the formation of products.

Machinery rentals (ASM): This item includes rental payments for the use of all 

items for which depreciation reserves would be maintained if they were owned by 

the establishment, e.g., structures and buildings, and production, office, and 

transportation equipment. Excluded are royalties and other payments for the use of 

intangibles and depletable assets and land rents where separable.

When an establishment of a multiestablishment company was charged rent by 

another part of the same company for the use of assets owned by the company, it 

was instructed to exclude that cost from rental payments.

If there were assets at an establishment rented from another company and the rents 

were paid centrally by the head office of the establishment, the company was 

instructed to report these rental payments as if they were paid directly by the 

establishment.
123

Maintenance and repair (Figure 4.5): See repair and maintenance services of 

buildings and/or machinery

Make table (BEA): Matrix that shows the value in producers' prices of each 

commodity produced by each industry. The entries in a row represent the dollar 

value of commodities produced by the industry at the beginning of the row. The 

entries in a column represent the dollar value of production by each industry of the 

commodity at the top of the column. It is one of the two primary tables in the I-O 

accounts. The make table, together with the use table, is used to derive the I-O total 

requirements tables.

Materials and supplies inventories, EOY (ASM): Respondents were asked to 

report their beginning of year and end of year inventories at cost or market. 

Effective with the 1982 Economic Census, this change to a uniform instruction for 

reporting inventories was introduced for all sector reports. Prior to 1982, 

respondents were permitted to value inventories using any generally accepted 

accounting method (FIFO, LIFO, or market, to name a few). Beginning in 1982, 

LIFO users were asked to first report inventory values prior to the LIFO adjustment 

and then to report the LIFO reserve and the LIFO value after adjustment for the 

reserve.

Inventory data by stage of fabrication 

Total inventories and three detailed components were collected:

1. Finished goods 

2. Work-in-process 

3. Materials, supplies, fuels, etc. 

Materials inventories refer to goods that are raw inputs to the manufacturing 

process, and that will be substantially altered to produce an establishment's output. 

Work-in-process inventories refer to goods that have been substantially transformed 

in the manufacturing process, but that are not yet the final output of the 

establishment. Finished goods are goods that represent the final output of the 

establishment, but that are still within ownership of the establishment.

When using inventory data by stage of fabrication for "all industries" and at the 

three-digit subsector level, it should be noted that an item treated as a finished 

product by an establishment in one industry may be reported as a raw material by an 

establishment in a different industry. For example, the finished product inventories 

of a steel mill would be reported as raw materials by a stamping plant. Such 

differences are present in the inventory figures by stage of fabrication shown for all 

publication levels.

Materials and supplies inventories, BOY (ASM): Respondents were asked to 

report their beginning of year and end of year inventories at cost or market. 
124

Effective with the 1982 Economic Census, this change to a uniform instruction for 

reporting inventories was introduced for all sector reports. Prior to 1982, 

respondents were permitted to value inventories using any generally accepted 

accounting method (FIFO, LIFO, or market, to name a few). Beginning in 1982, 

LIFO users were asked to first report inventory values prior to the LIFO adjustment 

and then to report the LIFO reserve and the LIFO value after adjustment for the 

reserve.

Inventory data by stage of fabrication 

Total inventories and three detailed components were collected:

1. Finished goods 

2. Work-in-process 

3. Materials, supplies, fuels, etc. 

Materials inventories refer to goods that are raw inputs to the manufacturing 

process, and that will be substantially altered to produce an establishment's output. 

Work-in-process inventories refer to goods that have been substantially transformed 

in the manufacturing process, but that are not yet the final output of the 

establishment. Finished goods are goods that represent the final output of the 

establishment, but that are still within ownership of the establishment.

When using inventory data by stage of fabrication for "all industries" and at the 

three-digit subsector level, it should be noted that an item treated as a finished 

product by an establishment in one industry may be reported as a raw material by an 

establishment in a different industry. For example, the finished product inventories 

of a steel mill would be reported as raw materials by a stamping plant. Such 

differences are present in the inventory figures by stage of fabrication shown for all 

publication levels.

Materials, parts, containers, packaging, etc. used (ASM): This term refers to 

direct charges actually paid or payable for items consumed or put into production 

during the year, including freight charges and other direct charges incurred by the 

establishment in acquiring these materials. It includes the cost of materials or fuel 

consumed, whether purchased by the individual establishment from other 

companies, transferred to it from other establishments of the same company, or 

withdrawn from inventory during the year.

Included in this item are:

1. Cost of parts, components, containers, etc. Includes all raw materials, 

semifinished goods, parts, containers, scrap, and supplies put into production or 

used as operating supplies and for repair and maintenance during the year. 

2. Cost of products bought and sold in the same condition. 
125

3. Cost of fuels consumed for heat and power. Includes the cost of materials or fuel 

consumed, whether purchased by the individual establishment from other 

companies, transferred to it from other establishments of the same company, or 

withdrawn from inventory during the year. 

4. Cost of purchased electricity. The cost of purchased electric energy represents the 

amount actually used during the year for heat and power. In addition, information 

was collected on the quantity of electric energy generated by the establishment 

and the quantity of electric energy sold or transferred to other plants of the same 

company. 

5. Cost of contract work. This term applies to work done by others on materials 

furnished by the manufacturing establishment. The actual cost of the material is to 

be reported on the cost of materials, parts, and containers line of this item. The 

term "contract work" refers to the fee a company pays to another company to 

perform a service.

Net Income (Manufacturing Supply Chain and Table 4.1): The total value of 

shipments less all costs (communication services; other costs; refuse removal; 

computer hardware, software, and other equipment; professional, technical, and data 

services, payroll and benefits; capital expenditures; materials, parts, containers, 

packaging, etc used; contract work and resales; purchased fuels and electicity; and 

maintenance and repair) and depreciation.

Net Inventories Shipped (Manufacturing Supply Chain and Table 4.1): The 

total beginning of year (BOY) inventories (finished goods and work-in-process 

inventories) less the total end of year (EOY) inventories (finished goods and workin-process inventories).

Other Costs (Figure 4.5): The sum of Taxes and license fees, advertising and 

promotional services, temporary staff and leased employee expenses, and all other 

expenses from the ASM.

Other misc. receipts (ASM): Miscellaneous receipts represent receipts from 

activities of the establishment other than the manufacturing of products from its own 

materials. Service activities such as installation, repair, and training are 

miscellaneous receipts. Assembly of products from materials owned by others and 

the sale of products bought and resold without further value added are other 

examples of miscellaneous receipts. Miscellaneous receipts are collected using the 

following categories:

1. Reported contract work - receipts for work or services that a plant performed for 

others on their materials.

2. Value of resales - sales of products bought and sold without further manufacture, 

processing, or assembly. 

3. Other miscellaneous receipts - such as repair work, installation, sales of scrap, etc.
126

Payroll, Benefits, and Employment (Figure 4.5): This is the sum of annual payroll 

and total fringe benefits from the ASM shown with the number of employees.

Production workers wages (ASM): "Production workers" refers to workers up 

through the line-supervisor level engaged in fabricating, processing, assembling, 

inspecting, receiving, packing, warehoursing, shipping (but not delivering) 

maintenance, repair, janitorial, guard services, product development, auxiliary 

production for the plant's own use (e.g., power plant workers), recordkeeping, and 

other closely associated services (including truck drivers delivering ready-mixed 

concrete).

"Payroll" includes the gross earnings of all employees on the payrolls of operating 

manufacturing establishments paid in the calendar year. Respondents were told they 

could follow the definition of payrolls used for calculating the federal withholding 

tax. It includes all forms of compensation, such as salaries, wages, commissions, 

dismissal pay, bonuses, vacation and sick leave pay, and compensation in kind, prior 

to such deductions as employees' social security contributions, withholding taxes, 

group insurance, union dues, and savings bonds. The total includes salaries of 

officers of corporations; it excludes payments to proprietors or partners of 

unincorporated concerns. Also excluded are payments to members of Armed Forces 

and pensioners carried on the active payrolls of manufacturing establishments.

The census definition of payrolls is identical to that recommended to all federal 

statistical agencies by the Office of Management and Budget. It should be noted that 

this definition does not include employers' social security contributions or other 

nonpayroll labor costs, such as employees' pension plans, group insurance 

premiums, and workers' compensation.

Note: Beginning with the 2006 ASM, for employment and related fields (payroll, 

production hours, benefits), respondents were asked to report only those full- and parttime employees whose payroll was reported on the IRS Form 941 filing for the Employer 

Identification Number (EIN) used by that manufacturing establishment. Other temporary 

workers and workers whose payroll was reported under a different company's EIN were 

reported elsewhere on the form. In 2002, these data constituted between 1 and 1 1/2% of 

the total for these fields. Comparisons with data prior to 2006 should be used with 

caution.

Professional, Technical, and Data Services (Figure 4.5): This is the sum of data 

processing and other purchased computer services and purchased professional and 

technical services from the ASM.

Profit from Fees (Table 2.1): The financial benefit realized when revenues exceed costs 

and taxes for a service.

Profit from Markup (Table 2.1): The difference between the cost of a good and its 

selling price.
127

Profit from Sales (Table 2.1): The financial benefit realized when revenues exceed 

costs and taxes for a product.

Purchased electricity (ASM): This term refers to direct charges actually paid or 

payable for items consumed or put into production during the year, including freight 

charges and other direct charges incurred by the establishment in acquiring these 

materials. It includes the cost of materials or fuel consumed, whether purchased by 

the individual establishment from other companies, transferred to it from other 

establishments of the same company, or withdrawn from inventory during the year.

Included in this item are:

1. Cost of parts, components, containers, etc. Includes all raw materials, 

semifinished goods, parts, containers, scrap, and supplies put into production or 

used as operating supplies and for repair and maintenance during the year. 

2. Cost of products bought and sold in the same condition. 

3. Cost of fuels consumed for heat and power. Includes the cost of materials or fuel 

consumed, whether purchased by the individual establishment from other 

companies, transferred to it from other establishments of the same company, or 

withdrawn from inventory during the year. 

4. Cost of purchased electricity. The cost of purchased electric energy represents the 

amount actually used during the year for heat and power. In addition, information 

was collected on the quantity of electric energy generated by the establishment 

and the quantity of electric energy sold or transferred to other plants of the same 

company. 

5. Cost of contract work. This term applies to work done by others on materials 

furnished by the manufacturing establishment. The actual cost of the material is to 

be reported on the cost of materials, parts, and containers line of this item. The 

term "contract work" refers to the fee a company pays to another company to 

perform a service.

Purchased fuels and electricity (Figure 4.5): This item is the sum of the cost of 

purchased fuels and purchased electricity from the ASM.

Purchased professional and technical services (ASM): Included in the cost of 

selected purchased professional and technical services are payments made to other 

companies for these services which were paid directly by the establishment. These 

include payments for management consulting, accounting, auditing, bookkeeping, 

legal, actuarial, payroll processing, architectural, engineering, and other professional 

services. Excluded are the salaries paid to employees of this establishment for these 

services.

Purchasing Price (Table 2.1): Market value of goods sold
128

Redefinition (BEA): Redefinitions, one of the three methods for handling 

secondary products, are made as part of the preparation of the supplementary I-O 

make and use tables.

Redefinitions are made when an industry’s production of a secondary product has 

very different inputs (“recipe”) than those for the production of its primary product. 

In such a case, the secondary product (output and inputs) is moved (“redefined”) 

from the industry in which the output occurs to the industry in which the product is 

primary. For example, the output and associated inputs for restaurants located in 

hotels are moved from the hotels and lodging places industry to the eating and 

drinking places industry.

Redefinitions do not affect the definition of the commodity or the measurement of 

commodity output, which consists of all of the output of that commodity wherever 

it’s produced. However, redefinitions do affect industry output.

Refuse removal (including hazardous waste) services (ASM): Included in the 

cost of selected purchased refuse removal services are payments made to other 

companies for these services which were paid directly by the establishment, 

including costs for hazardous waste removal or treatment. Excluded are all costs 

included in rental payments or as capital expenditures and the salaries paid to 

employees of the establishment for these services.

Repair and maintenance services of buildings and/or machinery (ASM): 

Included in the cost of selected purchased services for the repair and maintenance 

services of buildings and/or machinery are payments made for all maintenance and 

repair work on buildings and equipment. Payments made to other establishments of 

the same company and for repair and maintenance of any leased property also are 

included. Excluded from this item are extensive repairs or reconstruction that was 

capitalized, which is considered capital expenditures; costs incurred directly by the 

establishment in using its own work force to perform repairs and maintenance work; 

and repairs and maintenance provided by the building or machinery owner as part of 

the rental contract.

Requirements table (BEA): There are four I-O requirements tables: Commodityby-industry direct requirements, commodity-by-commodity total requirements, 

industry-by-commodity total requirements, and industry-by-industry total 

requirements.

Secondary product (BEA): A good or service that is produced by an industry in 

addition to its primary product. Secondary products are the primary product of 

another industry. Secondary products in the I-O accounts are termed redefinitions, 

reclassifications, and other secondary products.

Shipments (Manufacturers’ Shipments, Inventories, and Orders Survey): 

Manufacturers’ shipments measure the dollar value of products sold by 
129

manufacturing establishments and are based on net selling values, f.o.b. (free on 

board) plant, after discounts and allowances are excluded. Freight charges and 

excise taxes are excluded. Where the products of an industry are customarily 

delivered to distributors or consumers by the manufacturing establishment (such as 

in certain foods industries – fluid milk, bakery, soft drinks), the value is based on 

delivered price rather than f.o.b. plant price. Multi-industry companies report value 

information for each industry category as if it were a separate economic unit. Thus, 

products transferred from one plant to another are valued at their full economic 

value.

Standard make and use tables (BEA): The featured tables in the 1997 benchmark 

I-O, these tables are based on NAICS. They are constructed before the redefinitions 

of selected secondary products. (In the 1992 I-O accounts, these make and use tables 

were referred to as “alternative” tables.)

Supplementary make and use tables (BEA): A second set of tables in the 1997 

benchmark I-O, these tables are derived from the standard make and use tables. The 

estimates in the supplementary make and use tables are after the redefinitions of 

selected secondary products. (In the 1992 I-O accounts, these make and use tables 

and the requirements tables were referred to as “traditional” tables, and the NIPA 

bridge tables were referred to as “supplementary” tables.)

Taxes and license fees (ASM): Includes payments made to government agencies 

for business and property taxes and licensing fees. Income taxes are excluded from 

this item.

Temporary staff and leased employee expenses (ASM): Included in the cost of 

selected temporary staff and leased employee expenses are total costs which were 

paid directly by the establishment to Professional Employer Organizations (PEOs) 

and staffing agencies for personnel. These include all charges for payroll, benefits, 

and services.

Total BOY inventories (ASM): Respondents were asked to report their beginning 

of year and end of year inventories at cost or market. Effective with the 1982 

Economic Census, this change to a uniform instruction for reporting inventories was 

introduced for all sector reports. Prior to 1982, respondents were permitted to value 

inventories using any generally accepted accounting method (FIFO, LIFO, or 

market, to name a few). Beginning in 1982, LIFO users were asked to first report 

inventory values prior to the LIFO adjustment and then to report the LIFO reserve 

and the LIFO value after adjustment for the reserve.

Inventory data by stage of fabrication

Total inventories and three detailed components were collected:

1. Finished goods 
130

2. Work-in-process 

3. Materials, supplies, fuels, etc. 

Materials inventories refer to goods that are raw inputs to the manufacturing 

process, and that will be substantially altered to produce an establishment's output. 

Work-in-process inventories refer to goods that have been substantially transformed 

in the manufacturing process, but that are not yet the final output of the 

establishment. Finished goods are goods that represent the final output of the 

establishment, but that are still within ownership of the establishment.

When using inventory data by stage of fabrication for "all industries" and at the 

three-digit subsector level, it should be noted that an item treated as a finished 

product by an establishment in one industry may be reported as a raw material by an 

establishment in a different industry. For example, the finished product inventories 

of a steel mill would be reported as raw materials by a stamping plant. Such 

differences are present in the inventory figures by stage of fabrication shown for all 

publication levels.

Total capital expenditures (new and used) (ASM): Represents the total new and 

used capital expenditures reported by establishments in operation and any known 

plants under construction.

These data include expenditures for:

1. Permanent additions and major alterations to manufacturing and mining 

establishments.

2. New and used machinery and equipment used for replacement and additions to 

plant capacity, if they are of the type for which depreciation, depletion, or (for 

mining establishments) Office of Minerals Exploration accounts are ordinarily 

maintained. In addition, for mining establishments, these data include 

expenditures made during the year for development and exploration of mineral 

properties. For manufacturing establishments, these data are broken down into 

three types: 

a. Automobiles, trucks, etc. for highway use. These include vehicles 

acquired under a lease-purchase agreement and exclude vehicles leased or

normally designed to transport materials, property, or equipment on 

mining, construction, petroleum development, and similar projects. These 

vehicles are of such size or weight as to be normally restricted by state 

laws or regulations from operating on public highways. Also excluded are 

vehicles that are purchased by a company for highway use. 

b. Computers and peripheral data processing equipment. This item includes 

all purchases of computers and related equipment. 

c. All other expenditures for machinery and equipment excluding 

automobiles and computer equipment. 
131

Capital expenditures include work done by contract, as well as by the 

establishment's own workforce.

These data exclude expenditures for land and mineral rights and cost of maintenance 

and repairs charged as current operating expenses.

Total cost of materials (ASM): This term refers to direct charges actually paid or 

payable for items consumed or put into production during the year, including freight 

charges and other direct charges incurred by the establishment in acquiring these 

materials. It includes the cost of materials or fuel consumed, whether purchased by 

the individual establishment from other companies, transferred to it from other 

establishments of the same company, or withdrawn from inventory during the year.

Included in this item are:

1. Cost of parts, components, containers, etc. Includes all raw materials, 

semifinished goods, parts, containers, scrap, and supplies put into production or 

used as operating supplies and for repair and maintenance during the year. 

2. Cost of products bought and sold in the same condition. 

3. Cost of fuels consumed for heat and power. Includes the cost of materials or fuel 

consumed, whether purchased by the individual establishment from other 

companies, transferred to it from other establishments of the same company, or 

withdrawn from inventory during the year. 

4. Cost of purchased electricity. The cost of purchased electric energy represents the 

amount actually used during the year for heat and power. In addition, information 

was collected on the quantity of electric energy generated by the establishment 

and the quantity of electric energy sold or transferred to other plants of the same 

company. 

5. Cost of contract work. This term applies to work done by others on materials

furnished by the manufacturing establishment. The actual cost of the material is to 

be reported on the cost of materials, parts, and containers line of this item. The 

term "contract work" refers to the fee a company pays to another company to 

perform a service.

Aggregate of total cost of materials and total value of shipments includes extensive 

duplication, since products of some industries are used as materials of others.

Total depreciation (ASM): This item includes depreciation and amortization 

charged during the year against assets. Depreciation charged against fixed assets 

acquired since the beginning of the year and against assets sold or retired during the 

year are components of this category. Respondents were requested to make certain 

that they did not report accumulated depreciation.

Total EOY inventories (ASM): Respondents were asked to report their beginning 

of year and end of year inventories at cost or market. Effective with the 1982 

Economic Census, this change to a uniform instruction for reporting inventories was 
132

introduced for all sector reports. Prior to 1982, respondents were permitted to value 

inventories using any generally accepted accounting method (FIFO, LIFO, or 

market, to name a few). Beginning in 1982, LIFO users were asked to first report 

inventory values prior to the LIFO adjustment and then to report the LIFO reserve 

and the LIFO value after adjustment for the reserve.

Inventory data by stage of fabrication 

Total inventories and three detailed components were collected:

1. Finished goods 

2. Work-in-process 

3. Materials, supplies, fuels, etc. 

Materials inventories refer to goods that are raw inputs to the manufacturing 

process, and that will be substantially altered to produce an establishment's output. 

Work-in-process inventories refer to goods that have been substantially transformed 

in the manufacturing process, but that are not yet the final output of the 

establishment. Finished goods are goods that represent the final output of the 

establishment, but that are still within ownership of the establishment.

When using inventory data by stage of fabrication for "all industries" and at the 

three-digit subsector level, it should be noted that an item treated as a finished 

product by an establishment in one industry may be reported as a raw material by an 

establishment in a different industry. For example, the finished product inventories 

of a steel mill would be reported as raw materials by a stamping plant. Such 

differences are present in the inventory figures by stage of fabrication shown for all 

publication levels.

Total Fringe Benefits (ASM): This item is the employer's costs for social security 

tax, unemployment tax, workers' compensation insurance, state disability insurance 

pension plans, stock purchase plans, union-negotiated benefits, life insurance 

premiums, and insurance premiums on hospital and medical plans for employees. 

Also included are the employer's costs for benefits to individual employees such as 

stock purchase plans, deferred profit-sharing plans, and defined benefit and defined 

contribution retirement plans. They exclude such items as company-operated 

cafeterias, in-plant medical services, free parking lots, discounts on employee 

purchases, and uniforms and work clothing for employees.

These figures represent the total amount of employer-paid benefits for all categories 

shown, and are inclusive of payments made on behalf of individuals that may not be 

included in the current payroll values . Consequently, for some manufacturing 

industries, payroll and benefits values may not move in tandem when compared to 

prior year tabulation totals.
133

Note: Beginning with the 2006 ASM, for employment and related fields (payroll, 

production hours, benefits), respondents were asked to report only those full- and 

part-time employees whose payroll was reported on the IRS Form 941 filing for the 

Employer Identification Number (EIN) used by that manufacturing establishment. 

Other temporary workers and workers whose payroll was reported under a different 

company's EIN were reported elsewhere on the form. In 2002, these data constituted 

between 1 and 1 1/2% of the total for these fields. Comparisons with data prior to 

2006 should be used with caution.

Total misc. receipts (ASM): Miscellaneous receipts represent receipts from 

activities of the establishment other than the manufacturing of products from its own 

materials. Service activities such as installation, repair, and training are 

miscellaneous receipts. Assembly of products from materials owned by others and 

the sale of products bought and resold without further value added are other 

examples of miscellaneous receipts. Miscellaneous receipts are collected using the 

following categories:

1. Reported contract work - receipts for work or services that a plant performed for 

others on their materials. 

2. Value of resales - sales of products bought and sold without further manufacture, 

processing, or assembly. 

3. Other miscellaneous receipts - such as repair work, installation, sales of scrap, etc.

Total other expenses (ASM): Included in the total cost of other expenses are the 

totals for the following:

 Temporary staff and leased employee expenses 

 Expensed computer hardware and other equipment 

 Expensed purchases of software 

 Data processing and other purchased computer services 

 Communication services 

 Repair and maintenance services of buildings and or machinery 

 Refuse removal (including hazardous waste) services 

 Advertising and promotional services 

 Purchased professional and technical services 

 Taxes and license fees 

 All other expenses 

Total rental payments (ASM): This item includes rental payments for the use of all 

items for which depreciation reserves would be maintained if they were owned by 

the establishment, e.g., structures and buildings, and production, office, and 

transportation equipment. Excluded are royalties and other payments for the use of 

intangibles and depletable assets and land rents where separable.
134

When an establishment of a multiestablishment company was charged rent by 

another part of the same company for the use of assets owned by the company, it 

was instructed to exclude that cost from rental payments.

If there were assets at an establishment rented from another company and the rents 

were paid centrally by the head office of the establishment, the company was 

instructed to report these rental payments as if they were paid directly by the 

establishment.

Total requirements tables (BEA): Three I-O tables showing the output required to 

meet a given level of final use. The three tables are the commodity-by-commodity 

total requirements table, the industry-by-commodity total requirements table, and 

the industry-by-industry total requirements table. All three tables are calculated from 

the supplementary make and use tables.

Total value of shipments (ASM): This item covers the received or receivable net 

selling values, f.o.b. plant (exclusive of freight and taxes), of all products shipped as 

well as all miscellaneous receipts, such as receipts for contract work performed for 

others, installation and repair, sales of scrap, and sales of products bought and sold 

without further processing. Included are all items made by or for the establishments 

from material owned by it, whether sold, transferred to other plants of the same 

company, or shipped on consignment. The net selling value of products made in one 

plant on a contract basis from materials owned by another was reported by the plant 

providing the materials.

In the case of multiunit companies, the manufacturer was requested to report the 

value of products transferred to other establishments of the same company at full 

economic or commercial value, including not only the direct cost of production but 

also a reasonable proportion of "all other costs" (including company overhead) and 

profit.

Data represent total value of shipments for most industries. For industries 311411, 

311412, 311421, 311422, 311711, 311712, 311941, 311999, 312140, 312210, 

312221, and 312229, value of production is shown. For industry 336611, value of 

work done is shown.

In addition to the value for NAICS-defined products, aggregates of the following 

categories of miscellaneous receipts are reported as part of a total establishment's 

value of products shipments:

1. Reported contract work - receipts for work or services that a plant performed for 

others on their materials; 

2. Value of resales - sales of products bought and sold without further manufacture, 

processing, or assembly; and 

3. Other miscellaneous receipts - includes repair work, installation, sales of scrap, 

etc. 
135

Use table (BEA): Matrix that shows the consumption of commodities by each 

industry or final user. The entries in a row represent the dollar value of the 

commodity consumed by each industry or final user. The total output of each 

commodity is the sum of all intermediate uses of the commodity by industries and 

all sales to final users, or the sum of the row entries. The entries in a column 

represent the dollar value of each commodity and value-added component used by 

the industry. The total output of each industry is the sum of all intermediate uses of 

all commodities and value added, or the sum of the column entries. For the economy 

as a whole, the total of all final uses of commodities equals the sum of all value 

added by all industries, or GDP. Use tables are produced for industries both before 

redefinitions and after redefinitions. It is one of the two primary tables in the I-O 

accounts. The use table, together with the make table, is used to derive the I-O total 

requirements tables.

Value added (ASM): This measure of manufacturing activity is derived by 

subtracting the cost of materials, supplies, containers, fuel, purchased electricity, and 

contract work from the value of shipments (products manufactured plus receipts for 

services rendered). The result of this calculation is adjusted by the addition of value 

added by merchandising operations (i.e., the difference between the sales value and 

the cost of merchandise sold without further manufacture, processing, or assembly) 

plus the net change in finished goods and work-in-process between the beginning 

and end of year inventories.

For those industries where value of production is collected instead of value of 

shipments, value added is adjusted only for the change in work-in-process 

inventories between the beginning and end of year. For those industries where value 

of work done is collected, the value added does not include an adjustment for the 

change in finished goods or work-in-process inventories.

This item avoids the duplication in the figure for value of shipments that results 

from the use of products of some establishments as materials by others. Value added 

is considered to be the best value measure available for comparing the relative 

economic importance of manufacturing among industries and geographic areas.

Value added (BEA): The difference between an industry’s or an establishment's 

total output and the cost of its intermediate inputs. It equals gross output (sales or 

receipts and other operating income, plus inventory change) minus intermediate 

inputs (consumption of goods and services purchased from other industries or 

imported). Value added consists of compensation of employees, taxes on production 

and imports less subsidies (formerly indirect business taxes and nontax payments), 

and gross operating surplus (formerly “other value added”).
136

Value added (OECD): The value added used by the OECD is stated to be 

consistent with that described in the 1993 System of National Accounts.92

Value added (UNSD): Gross value added is the value of output less the value of 

intermediate consumption; it is a measure of the contribution to GDP made by an 

individual producer, industry or sector; gross value added is the source from which 

the primary incomes of the System of National Accounts (SNA) are generated and is 

therefore carried forward into the primary distribution of income account.

Value of interplant transfers (ASM): In the case of multiunit companies, the 

manufacturer was requested to report the value of products transferred to other 

establishments of the same company at full economic or commercial value, 

including not only the direct cost of production but also a reasonable proportion of 

"all other costs" (including company overhead) and profit.

Value of products shipments (ASM): This item covers the received or receivable 

net selling values, f.o.b. plant (exclusive of freight and taxes), of all products 

shipped. Miscellaneous receipts, such as receipts for contract work performed for 

others, installation and repair, sales of scrap, and sales of products bought and sold 

without further processing are excluded from this item. Included are all items made 

by or for the establishments from material owned by it, whether sold, transferred to 

other plants of the same company, or shipped on consignment. The net selling value 

of products made in one plant on a contract basis from materials owned by another 

was reported by the plant providing the materials.

In the case of multiunit companies, the manufacturer was requested to report the 

value of products transferred to other establishments of the same company at full 

economic or commercial value, including not only the direct cost of production but 

also a reasonable proportion of "all other costs" (including company overhead) and 

profit.

Data represent total value of shipments for most industries. For industries 311411, 

311412, 311421, 311422, 311711, 311712, 311941, 311999, 312140, 312210, 

312221, and 312229, value of production is shown. For industry 336611, value of 

work done is shown.

Value of resales (ASM): Miscellaneous receipts represent receipts from activities of 

the establishment other than the manufacturing of products from its own materials. 

Service activities such as installation, repair, and training are miscellaneous receipts. 

Assembly of products from materials owned by others and the sale of products 

bought and resold without further value added are other examples of miscellaneous 

receipts. Miscellaneous receipts are collected using the following categories:

 

92 Yamano, Norihiko and Nadim Ahmad. (2006) “The OECD Input-Output Database: 2006 Edition.” STI 

Working Paper 2006/8. Organisation for Economic Co-operation and Development. October 20, 2006. 

<http://www.oecd.org/dataoecd/46/54/37585924.pdf>
137

1. Reported contract work - receipts for work or services that a plant performed for 

others on their materials. 

2. Value of resales - sales of products bought and sold without further manufacture, 

processing, or assembly. 

3. Other miscellaneous receipts - such as repair work, installation, sales of scrap, etc.

Volume of Production (Figure 4.5): This item is the sum of all expenditures shown 

in Figure 4.5, including communication services; other costs; refuse removal; 

computer hardware, software, and other equipment; professional, technical, and data 

services; payroll and benefits; capital expenditures: Buildings and other structures; 

capital expenditures: machinery and equipment; materials, parts, containers, 

packaging, etc. used; contract work and resales; and purchased fuels and electricity.

Work-in- process inventories, BOY (ASM): Respondents were asked to report 

their beginning of year and end of year inventories at cost or market. Effective with 

the 1982 Economic Census, this change to a uniform instruction for reporting 

inventories was introduced for all sector reports. Prior to 1982, respondents were 

permitted to value inventories using any generally accepted accounting method 

(FIFO, LIFO, or market, to name a few). Beginning in 1982, LIFO users were asked 

to first report inventory values prior to the LIFO adjustment and then to report the 

LIFO reserve and the LIFO value after adjustment for the reserve.

Inventory data by stage of fabrication 

Total inventories and three detailed components were collected:

1. Finished goods 

2. Work-in-process 

3. Materials, supplies, fuels, etc. 

Materials inventories refer to goods that are raw inputs to the manufacturing 

process, and that will be substantially altered to produce an establishment's output. 

Work-in-process inventories refer to goods that have been substantially transformed 

in the manufacturing process, but that are not yet the final output of the 

establishment. Finished goods are goods that represent the final output of the 

establishment, but that are still within ownership of the establishment.

When using inventory data by stage of fabrication for "all industries" and at the 

three-digit subsector level, it should be noted that an item treated as a finished 

product by an establishment in one industry may be reported as a raw material by an 

establishment in a different industry. For example, the finished product inventories 

of a steel mill would be reported as raw materials by a stamping plant. Such 

differences are present in the inventory figures by stage of fabrication shown for all 

publication levels.
138

Work-in- process inventories, EOY (ASM): Respondents were asked to report 

their beginning of year and end of year inventories at cost or market. Effective with 

the 1982 Economic Census, this change to a uniform instruction for reporting 

inventories was introduced for all sector reports. Prior to 1982, respondents were 

permitted to value inventories using any generally accepted accounting method 

(FIFO, LIFO, or market, to name a few). Beginning in 1982, LIFO users were asked 

to first report inventory values prior to the LIFO adjustment and then to report the 

LIFO reserve and the LIFO value after adjustment for the reserve.

Inventory data by stage of fabrication 

Total inventories and three detailed components were collected:

1. Finished goods 

2. Work-in-process 

3. Materials, supplies, fuels, etc. 

Materials inventories refer to goods that are raw inputs to the manufacturing 

process, and that will be substantially altered to produce an establishment's output. 

Work-in-process inventories refer to goods that have been substantially transformed 

in the manufacturing process, but that are not yet the final output of the 

establishment. Finished goods are goods that represent the final output of the 

establishment, but that are still within ownership of the establishment.

When using inventory data by stage of fabrication for "all industries" and at the 

three-digit subsector level, it should be noted that an item treated as a finished 

product by an establishment in one industry may be reported as a raw material by an 

establishment in a different industry. For example, the finished product inventories 

of a steel mill would be reported as raw materials by a stamping plant. Such 

differences are present in the inventory figures by stage of fabrication shown for all 

publication levels.