U.S. Department of Commerce

Economics and Statistics Administration

Manufacturing Since the Great Recession

Executive Summary

 

he U.S. manufacturing sector has turned a corner. For the first time in over 10

 years, output and employment are growing steadily. Manufacturing output has 

grown 38 percent since the end of the recession, and the sector accounts for 19

percent of the rise in real gross domestic product (GDP) since then. Through May, 

the sector has added 646,000 jobs, and manufacturers are actively recruiting to fill 

another 243,000 positions.1

The steady growth across all three of these areas might have seemed like wishful 

thinking just a few years ago when manufacturing was hit especially hard. Yet, 

manufacturing output and exports have surpassed their pre-recession peaks, and 

employment has begun to grow again for the first time since 1998. Analysis by the 

President’s Council of Economic Advisors indicates that this is more than a cyclical 

rebound; the US has gained about four times as many manufacturing jobs since 

2009 as would be expected from cyclical factors alone. Nonetheless, while the 

manufacturing expansion is robust, some industries and U.S. states have fared 

better than others. This report provides an overview of these trends in 

manufacturing, examining production, international trade, and the labor market.

Our analysis shows that:

 Manufacturing has contributed decisively to GDP growth. Since the end of 

the recession in second quarter 2009, real manufacturing value added has 

climbed 18 percent, compared to an 11 percent rise in real U.S. GDP, 

increasing manufacturing’s share of total GDP to 12.5 percent at the end of 

2013.

 The manufacturing sector added 646,000 jobs from February 2010 to May 

2014.

 Average annual weekly hours for production workers in the manufacturing 

sector have climbed to their highest level since the mid 1940s. 

 Although growth has returned across manufacturing, just two industries 

have accounted for nearly half the rise in shipments: transportation 

equipment and petroleum and coal products.

 

1

Openings data from Job Openings and Labor Turnover Survey, Bureau of Labor Statistics.

By 

Jessica R. Nicholson 

and 

Ryan Noonan

ESA Issue Brief

# 02-14

June 10, 2014

T
Page 2 U. S. Department of Commerce, Economics and Statistics Administration 

 Export sales account for more than a quarter of the rebound in shipments since 2009. Exports of 

U.S. manufactured goods totaled $1.2 trillion in 2013. Transportation equipment and refined 

petroleum (and coal) products captured 43 percent of the export gains. 

 Foreign investors also are helping build the U.S. manufacturing sector. As of 2012, total direct 

investment in the U.S. from abroad totaled $2.7 trillion, of which $899 billion (34 percent) was 

placed in the manufacturing sector.

 The number of manufacturing establishments is growing for the first time since 1999. 

 87 percent of the job gains in manufacturing have been in three durable goods industries: 

transportation equipment, fabricated metal products, and machinery.

 Job gains in manufacturing have been widespread throughout the country. More than half of the 

jobs added were in five states: Michigan, Texas, Indiana, Ohio, and Wisconsin. 
U. S. Department of Commerce, Economics and Statistics Administration Page 3

Introduction

The U.S. manufacturing sector has turned a 

corner. For the first time in over 10 years, 

output and employment are growing steadily. 

Manufacturing output has grown 38 percent 

since the end of the recession, and the sector 

accounts for 19 percent of the rise in real gross 

domestic product (GDP) since then. Between 

February 2010 and May 2014, the sector has 

added 646,000 jobs, and manufacturers are 

actively recruiting to fill another 243,000 

positions.2

For many years, as services have become an 

important source of economic activity, 

manufacturing’s share of the overall economy 

has been shrinking. In the late 1940s, 

manufacturing accounted for around a third of 

total nonfarm employment in the United States 

and around a quarter of GDP.

3 Now it accounts 

for just 12 percent of GDP and about one in 

eleven nonfarm jobs. Still, there are many ways 

in which manufacturing is critical for innovation, 

trade, and the middle class. Our nation’s 

manufacturers account for 75 percent of 

research and development spending and 52

percent of exports.4 Over the last four years, 43

percent of foreign direct investment has gone 

to the manufacturing sector.5 Workers earn 16

percent more (in combined wages and benefits)

in a manufacturing job than they would 

 

2

Openings data from Job Openings and Labor Turnover 

Survey, Bureau of Labor Statistics.

3

GDP is measured in nominal dollars for this calculation 

due to the unavailability of historical data. 

Manufacturing’s share of GDP remained close to a quarter 

of GDP until almost 1970, at which point it began to 

steadily decline. Manufacturing’s share of nonfarm 

employment fell to 25 percent by 1970, 16 percent by 

1990, and continued to decline through 2009 when it 

landed at 9 percent, where it remains today. 

4

R&D expenditures data from Bureau of Economic 

Analysis. Export data from Census Bureau.

5

By comparison, about 18 percent of private domestic 

investment between 2009 and 2012 went to the 

manufacturing sector. Data for both FDI and domestic 

investment are from the Bureau of Economic Analysis.

elsewhere.

6 Not surprisingly quit rates are lower 

than any other non-government sector.

7

 

This report provides an overview of the 

renewed expansion in manufacturing, 

examining output, international trade, and the 

labor market. The steady growth across all 

three of these areas might have seemed like 

wishful thinking just a few years ago when 

manufacturing was hit especially hard. Since the 

last recession, however, manufacturing output 

and exports have surpassed their pre-recession 

levels, and employment has begun to grow 

again for the first time since 1998. Nonetheless, 

while the manufacturing expansion is robust, it 

has not been even across manufacturing 

industries and the states. 

Production, Trade, and Foreign 

Direct Investment

Manufacturing is recovering, particularly in 

petroleum refining and transportation

From December 2007 through February 2010, 

the manufacturing sector shed 2.3 million jobs, 

more than a quarter of jobs lost across all 

sectors during those 26 months (see Figure 1). 

During the recession, manufacturing alone 

accounted for half of the total drop in GDP. 

Since the end of the recession, real value added 

in the manufacturing sector has climbed back 

18 percent, compared to an 11 percent rise in

overall GDP. As a result, manufacturing’s share 

of total GDP has risen from a low of 11.8

percent in second quarter 2009 to 12.5 percent

 

6

Update to the analysis performed in ESA’s report, “The 

Benefits of Manufacturing Jobs.” Accessed online: 

http://www.esa.doc.gov/sites/default/files/reports/docu

ments/1thebenefitsofmanufacturingjobsfinal5912.pdf. 

7

Quit rates from Job Openings and Labor Turnover Survey, 

Bureau of Labor Statistics. Analysis on earnings of new 

hires available from ESA: 

http://www.esa.doc.gov/Blog/2014/02/10/earnings-newhires-manufacturing-wage-benefits-continue. 
Page 4 U. S. Department of Commerce, Economics and Statistics Administration

at the end of 2013. 

Total shipments (or sales) of manufactured 

goods, which the Census Bureau measures 

monthly in current dollars, closely track overall

output as well. Between 2009 and 2013, 

shipments increased $1.4 trillion, a gain of more 

than 30 percent. The rebound in nominal sales, 

while steady, has not been as immediate as the 

plunge in output during the recession. In just 

10 months between July 2008 and May 2009, 

monthly factory output was slashed by $133 

billion (27 percent). It took 45 months to climb 

back.8 

 

8

Other data indicate expansion as well. The Federal 

Reserve Board’s industrial production index for 

manufacturing has reached its highest level since 2008, 

and is nearly at its pre-recession peak. In fact, the index for 

production of durable goods reached a record high in 

Within manufacturing, however, the expansion 

has not been uniform. Growth in output has 

been uneven across industries. While the 

increase in shipments of goods has been split 

almost evenly between durable and nondurable 

goods, nearly 50 percent of total growth is 

accounted for by just two industries: 

transportation equipment and petroleum and 

coal products (see Figure 2).9 Over the first 

 

March 2014. The indices for machinery, motor vehicles, 

and aerospace manufacturing have also reached record 

highs in the first part of 2014. The index for computer 

manufacturing has similarly reached a record high, but the 

flat trend in manufacturers’ shipments indicates that the 

apparent growth in production is due to rapidly declining 

prices for computing power, rather than to an increase in 

the output of computers and parts.

9

The petroleum and coal products manufacturing industry 

transforms crude petroleum and coal into usable products. 

The dominant process is petroleum refining, which 

Figure 1. Monthly Change in Manufacturing Shipments and Employment, 

January 2005-May 2014

Note: Red bars indicate recession. At the time of publication, May 2014 manufacturing shipments data were not available. 

Source: Bureau of Economic Analysis and Bureau of Labor Statistics

Change in shipments 

(billions of dollars)

Change in employment 

(thousands of jobs)
U. S. Department of Commerce, Economics and Statistics Administration Page 5

three months of 2014, overall shipments 

continued to trend up, reaching a record level in 

April. Most industries in the manufacturing 

sector have returned or nearly returned to their 

pre-recession peaks. Two notable exceptions 

are apparel and printing, where output 

continues to decline.

Exports spurred growth in transportation, 

chemicals, and machinery, but...

In 2013, $1.2 trillion of manufactured goods 

made in America were shipped to customers 

abroad, and more than a quarter of the 

rebound in manufacturing shipments since 

 

involves the separation of crude petroleum into 

component products through such techniques as cracking 

and distillation. Establishments in this industry also further 

process refined petroleum and coal products to produce

products such as asphalt coatings and petroleum 

lubricating oils. See: 

http://www.bls.gov/iag/tgs/iag324.htm.

2009 is due to export demand. Over the four 

year period from 2009 to 2013, every industry 

of the manufacturing sector has seen growth in 

overall export value. As with output, export 

growth since the recession has been largely 

concentrated in transportation and refined 

petroleum products (and coal). Together, these 

industries were responsible for 43 percent of 

manufacturing export growth. 

In several industries, export growth has driven a 

large portion of overall growth in output. The 

transportation, chemical, and machinery 

manufacturing industries have seen more than 

30 percent of their post-recession growth come 

from exports. 

While manufactured goods exports have 

increased, imports of these goods have risen 

more, resulting in an increase in the 

manufacturing trade deficit of nearly 50 percent 

over the past four years. An alternative 

Printing

Apparel

Leather

Textiles

Textile mills

Furniture

Paper

Nonmetallic minerals

Computers

Beverages & tobacco

Electrical equipment

Wood

Plastics & rubber

Fabricated metals

Food

Machinery

Primary metals

Chemicals

Transportation

Petroleum & coal

-$100 -$50 $0 $50 $100 $150 $200 $250 $300 $350 $400

Source: Census Bureau

Figure 2. Growth of Exports and Shipments, 2009-2013

billions of dollars

Shipments

Exports
Page 6 U. S. Department of Commerce, Economics and Statistics Administration

measure of the trade deficit paints a brighter 

picture, though. The trade deficit in 

manufacturing may be rising, but so is the 

volume of U.S. trade in manufactured goods, 

which is the sum of all exports and imports. The 

manufacturing trade deficit’s share of the U.S. 

manufacturing trade volume has returned to a 

more modest level after reaching a high in 

2005. Over the past 14 years, the 

manufacturing trade deficit accounted for 21 

percent of the overall U.S. manufacturing trade 

volume in 1999, then rose to a high of 32 

percent in 2005, before returning to around 22 

percent in 2013.

Imports fulfilled the growing demand for 

computers and electronic products

Growth in U.S. demand for manufactured goods 

does not necessarily translate into greater U.S. 

production. Increasingly, consumers and 

businesses look to the global marketplace for 

goods. One way to determine how demand has 

changed is to separate domestic purchases of 

goods into shipments (less exports) and imports 

(see Figure 3). Since 2009, two industries that 

have seen large increases in domestic 

demand—transportation equipment and 

petroleum and coal products—highlight the 

contrast. U.S. demand for their products has 

increased by more than $400 billion in just four 

years. However, while imports accounted for 

nearly 35 percent of increased demand for 

transportation equipment, they accounted for 

only 12 percent of the total demand increase 

for petroleum and coal products. Growth in 

demand for computers and electronic products 

has been satisfied almost entirely by imports 

over this time period, with only 13 percent of 

new demand being met by domestic 

production.

As noted earlier, demand for domestic 

consumer goods and business equipment has 

Printing

Textiles

Textile mills

Paper

Leather

Furniture

Apparel

Nonmetallic minerals

Beverages & tobacco

Wood

Electrical equipment

Plastics & rubber

Fabricated metals

Computers

Food

Primary metals

Machinery

Chemicals

Petroleum & coal

Transportation

-10000 0 0 100 000 200 000 300 000 400 000 500 000

-$100 -$50 $0 $50 $100 $150 $200 $250 $300 $350 $400

Source: Census Bureau

Figure 3. Change in Domestic Demand, 2009 - 2013

shipments (less exports) and imports, billions of dollars

Shipments (less exports) Imports
U. S. Department of Commerce, Economics and Statistics Administration Page 7

been a large contributor to recent GDP growth 

after the recession. In particular, real consumer 

spending on motor vehicles and parts in the 

first quarter of 2014 had almost returned to its 

pre-recession level. Business spending on 

transportation equipment is at a record high

and spending on industrial equipment is nearing 

its pre-recession level as well. 

Foreign direct investment plays an important 

role in the manufacturing sector

“Made in America” is a badge of honor that 

numerous foreign investors want to attain. 

Indeed, in AT Kearney’s 2013 Foreign Direct 

Investment (FDI) Confidence Index, 302 

companies representing 28 countries and 

multiple industry sectors rated the United 

States as the country with the best FDI

prospects globally, the first time the U.S. took 

the #1 spot since 2001.10

Foreign direct investment (FDI) has been an 

important factor in U.S. manufacturing (see 

Figure 4).11 As of 2012, total direct investment 

in the U.S. from abroad totaled $2.7 trillion, of 

which $899 billion (34 percent) was placed in 

the manufacturing sector. Within 

manufacturing, the largest recipients of FDI are 

chemicals (26 percent), petroleum and coal (13 

percent), transportation (12 percent), and 

machinery (10 percent). Other manufacturing, 

which includes beverages and tobacco, textiles, 

apparel, leather, paper, printing, and plastics, 

 

10 AT Kearney, Foreign Direct Investment Confidence 

Index, 2013. 

http://www.atkearney.com/documents/10192/1464437/B

ack+to+Business+-+Optimism+Amid+Uncertainty+-

+FDICI+2013.pdf/96039e18-5d34-49ca-9cec-5c1f27dc099d

11 This report discusses FDI on a historical cost, or book 

value, basis.

$0

$50

$100

$150

$200

$250

Chemicals Computers Electrical

equipment

Food Machinery Metals Nonmetallic

minerals

Petroleum &

coal

Transportation Other

Note: Each column represents one year. Red bars indicate recession years.

Source: Bureau of Economic Analysis

Figure 4. Manufacturing FDI in the U.S., 2004-2012

foreign investment position by industry, billions of dollars
Page 8 U. S. Department of Commerce, Economics and Statistics Administration

represents 13 percent of all FDI invested in the 

United States. 12

In addition to stocks of investment, it is also 

important to understand the movement of new 

investment in the economy. Between 2009 and 

2013, inward flows of FDI totaled $770 billion, 

of which $330 billion (43 percent) was invested 

in the manufacturing sector. Within 

manufacturing, chemicals (predominately 

pharmaceuticals) attracted the most new 

investment: 43 percent of all FDI in the sector. 

Additionally, 9 percent of manufacturing FDI 

went to electrical equipment and 8 percent 

went to transportation equipment (mainly 

motor vehicles).

In a similar vein, foreign multinational 

companies (MNCs) have played a large role in 

the recent expansion. As of 2011, foreign MNCs 

employed 2.1 million manufacturing workers in 

the U.S., about 18 percent of total 

manufacturing employment. These firms

contributed to the U.S. economic recovery by

creating 120,000 manufacturing jobs between 

2009 and 2011, the latest available year of data. 

Over this period, MNCs’ job creation was 

concentrated in the transportation equipment, 

primary metals, and food manufacturing

industries.

 

12 Two recently released reports from the White House 

and the Department of Commerce provide even more 

detail about recent growth in foreign investment, and how 

the manufacturing sector has played a starring role.

The Executive Office of the President and the Department 

of Commerce, “Winning Business Investment in the United 

States,” May 2014. Available at: 

http://www.esa.doc.gov/sites/default/files/reports/docu

ments/winningbusinessinvestmentintheunitedstates.pdf

and The Department of Commerce and the President’s 

Council of Economic Advisers, “Foreign Direct Investment 

in the United States,” October 2013. Available at: 

http://www.esa.doc.gov/sites/default/files/reports/docu

ments/fdireport-ceafinalrt.pdf.

Back to Work

The number of manufacturing plants is

increasing for the first time in over ten years

The steady rise in output has begun to reverse 

years of shrinking numbers of manufacturing 

establishments (that is, plants) and jobs. Since 

the end of the most recent recession, the 

number of manufacturing establishments began 

to increase, rising in four of the past five 

quarters (through Q3 2013). Even more 

importantly, the number of manufacturing 

establishments grew on a year-over-year basis 

in the second and third quarters of 2013, 

marking the first such growth since 1999 (see 

Figure 5). 

The expansion is evident in other statistics, as 

well. Hours of production workers at 

manufacturing plants bounced back quickly 

after the recession. After bottoming out at 39.3 

hours in May 2009, average weekly hours 

rebounded in just 11 months to their prerecession level. Since then, hours have climbed 

(albeit at a slower pace) to their highest levels 

since the mid 1940s, reaching 42.1 hours in May 

of this year.13

Less than a year after manufacturers began 

increasing workers’ hours, they also started 

boosting their payrolls for the first time since 

the late 1990s (see Figure 6). Employment 

growth has remained steady; since overall U.S. 

employment began increasing again in March 

2010, the manufacturing sector created a net 

 

13 In the Current Employment Statistics survey, production 

workers include working supervisors and all 

nonsupervisory employees (including group leaders and 

trainees) engaged in fabricating, processing, assembling, 

inspecting, receiving, storing, handling, packing, 

warehousing, shipping, trucking, hauling, maintenance, 

repair, janitorial, guard services, product development, 

auxiliary production for plant's own use (for example, 

power plant), recordkeeping, and other services closely 

associated with the above production operations.
U. S. Department of Commerce, Economics and Statistics Administration Page 9

-3%

-2%

-1%

0%

1%

2%

3%

1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013

Source: Bureau of Labor Statistics

Figure 5. Manufacturing Establishments

year-over-year percent change

38

39

40

41

42

43

10

12

14

16

18

20

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014

Figure 6. Manufacturing Employment and Average Weekly Hours,

January 1990-May 2014

Note: Shaded areas indicate recessions.

Source: Bureau of Labor Statistics

Total number of jobs 

(all employees)

Average weekly hours

(production workers)

millions of jobs hours
Page 10 U. S. Department of Commerce, Economics and Statistics Administration

646,000 jobs (as of May 2014)—7 percent of

the nation’s overall job growth during this 

period.

Job growth has been strongest in 

transportation, fabricated metal, and 

machinery industries

The manufacturing sector comprises industries 

that create a diverse collection of goods. Just as 

with output, the growth in manufacturing 

employment has varied widely by industry (see 

Figure 7). Since manufacturing began adding 

jobs, all of the gains have been in durable goods 

industries. Digging deeper, 87 percent of the job 

gains in manufacturing have been in three 

durable goods industries: transportation 

equipment, fabricated metal products, and 

machinery.14 Together, these three industries 

 

14 Looking at these industries in more detail provides some 

additional insight about the contours of the manufacturing 

composed 34 percent of all manufacturing 

employment as of May 2014, so they have 

contributed more than their share of job 

growth during the post-recession period. 

Overall, nonfarm employment in the United 

States has rebounded and is above its prerecession high. While the same cannot be said 

for the manufacturing sector, where only 28 

percent of lost jobs have been replaced, the top 

three job-gaining industries have all recovered 

 

expansion. Within the transportation equipment industry, 

motor vehicle parts were responsible for 56 percent of the 

overall job growth for the industry. Data for detailed 

manufacturing industries lag one month from aggregated 

data and estimates are calculated through April 2014 in 

this report. Machine shops and threaded product 

manufacturing (NAICS 3327) added 38 percent of the jobs 

in fabricated metal manufacturing, while agriculture, 

construction, and mining machinery contributed 37 

percent within machinery manufacturing. For descriptions

of these industries, see 

http://www.census.gov/eos/www/naics/. 

-100 -50 0 50 100 150 200 250

Printing

Computers

Apparel

Paper

Textiles

Textile mills

Petroleum & coal

Furniture

Chemicals

Nonmetallic minerals

Miscellaneous durables

Electrical equipment

Miscellaneous nondurables

Wood

Food

Primary metals

Plastics & rubber

Machinery

Fabricated metals

Transportation

Figure 7. Total Change in Manufacturing Employment, March 2010-May 2014

thousands of jobs

Source: Bureau of Labor Statistics

Durable goods

Nondurable goods
U. S. Department of Commerce, Economics and Statistics Administration Page 11

more than 60 percent of the jobs lost to the 

recession. Only one manufacturing industry has 

surpassed its pre-recession employment level: 

miscellaneous nondurable goods, due to quickly 

growing employment at breweries, wineries, 

and distilleries.15

The Midwest and Texas have posted the bigget 

employment gains

The jobs data provide timely geographic detail 

not yet available for the output and export data 

cited earlier. While the job gains in 

manufacturing have been widespread 

throughout the country, more than half of the 

jobs added in the sector are located in five 

states: Michigan (96,800); Texas (73,000); 

Indiana (63,500); Ohio (58,000); and Wisconsin 

(42,600) (see Figure 8).16 The geographic 

 

15 Miscellaneous nondurables includes beverages and 

tobacco products and leather and allied products.

16 Manufacturing employment data are not available for 

Alabama and Oklahoma from the Current Employment 

Statistics survey. The job gains are calculated through April 

concentration of the manufacturing 

employment gains are in part due to the

geographic clustering of the expanding 

industries.

Clusters are geographic concentrations of 

interconnected industries and supportive 

organizations that make regions uniquely 

competitive for jobs and private investment.17

The Midwest (including Michigan, Indiana, Ohio, 

Wisconsin, Illinois, and Missouri) and the South 

(Kentucky, Tennessee, North Carolina, South 

Carolina, Alabama and Georgia, where a large 

number of manufacturing jobs have also been 

added) are areas where there is a large 

concentration of transportation equipment

 

2014, the latest data available at the time this report was 

published.

17 The U.S. Economic Development Administration (EDA) 

and the Harvard Business School have teamed up to create 

the U.S. Cluster mapping Project. For more information, 

see: http://www.eda.gov/about/cluster-mapping.htm. 

Figure 8. Manufacturing Job Growth Since the Recession

Change in Employment by State, February 2010-April 2014

Source: Bureau of Labor Statistics
Page 12 U. S. Department of Commerce, Economics and Statistics Administration

manufacturing.18 Over half of the country’s

employment in this industry is located in these 

12 states: the six Midwest states are home to a 

third of the employment in this industry, while 

the six states in the South are responsible for

another 18 percent.19 

Additionally, these areas are also sometimes 

referred to as the “machinery belt,” especially 

in the Midwest, because of the high 

 

18 Susan Helper, Timothy Krueger, and Howard Wial. 

“Locating American Manufacturing: Trends in the 

Geography of Production.” The Brookings Institute. 

Available at: 

http://www.brookings.edu/~/media/research/files/report

s/2012/5/09%20locating%20american%20manufacturing%

20wialh/0509_locating_american_manufacturing_report.p

df.

19 Calculated using Q3 2013 data from the Quarterly 

Census of Employment and Wages, Bureau of Labor 

Statistics. 

employment percentages in machinery, primary 

metals, fabricated metal products, and motor

vehicles and parts. The clustering of these 

industries in these areas allows for common 

access to machines and tools for forming metal

and to skilled workers.

20 Recent research shows 

that industry clusters and supporting industries 

nearby experience higher growth in 

employment, wages, number of establishments, 

and number of patents than non-clustered 

industries. This research undergirds some 

recent policy initiatives in the Department of 

Commerce (see Box 1). 

 

20 Mercedes Delgado, Michael E. Porter, and Scott Stern. 

“Clusters, Convergence, and Economic Performance.” The 

National Bureau of Economic Research. Available at: 

http://www.nber.org/papers/w18250. 

85

90

95

100

105

110

115

120

125

-59 -50 -40 -30 -20 -10 0 10 20 30 40 50 59

months since end of recession

2008-09 Recession

1990-91 Recession

2001 Recession

Source: Bureau of Labor Statistics 

Figure 9. Index of Manufacturing Employment Before and After Recessions

(final month of recession = 100)
U. S. Department of Commerce, Economics and Statistics Administration Page 13

Box 1. Investing in Manufacturing Communities Partnership

On May 28, 2014, U.S. Secretary of Commerce Penny Pritzker announced the first 12 communities 

that will be designated Manufacturing Communities as part of the Investing in Manufacturing 

Communities Partnership (IMCP) initiative. The interagency program, led by the White House and 

the U.S. Department of Commerce, is designed to accelerate the resurgence of manufacturing in 

communities nationwide by supporting the creation of long-term economic development strategies 

that help communities attract and expand private investment in the manufacturing sector and 

increase exports. 

Each of the selected communities represents a cluster of specialized manufacturing. For example, 

the 13-county Southeastern Michigan region represents 22 percent of the motor vehicles made in 

the United States and takes in over 70 percent of the spending on U.S. auto research and 

development. The Washington Puget Sound region is home to the largest aerospace cluster in the 

world with over 132,000 aerospace-related employees and more than 1,350 aerospace-related firms. 

These communities serve as a reminder that manufacturing in the United States is alive and well and 

that “Made in America” continues to be a source of pride. Below is the list of the 12 manufacturing 

community designees and their key, high-level manufacturing industry.

 Southwest Alabama – shipbuilding (transportation equipment)

 Southern California – aerospace (transportation equipment)

 Northwest Georgia – carpet (textiles and textile mills)

 Chicago metro region – metals and machinery (primary metals, fabricated metals, and 

machinery) 

 South Kansas – aerospace (transportation equipment)

 Maine’s Greater Portland region– food (food)

 Southeastern Michigan – automotive (transportation equipment)

 New York’s Finger Lakes region – photonics, optics, and precision machining (machinery, and 

computers and electronics)

 Southwestern Ohio Aerospace region – aerospace (transportation equipment)

 Tennessee Valley – automotive (transportation equipment)

 Washington Puget Sound region – aerospace (transportation equipment)

 Milwaukee 7 region – energy, power and controls; water technologies; and food 

(machinery; computers and electronics; electrical equipment, appliance, and components; 

and food

For more information, visit http://www.eda.gov/challenges/imcp/. 
Page 14 U. S. Department of Commerce, Economics and Statistics Administration

Is There a Renaissance in U.S. Manufacturing?

It may seem reasonable that employment 

would grow during an expansion, but job gains 

in manufacturing have not been immediate or 

guaranteed following the prior two recessions 

(see Figure 9). Even now, the growth makes 

only a modest dent in reversing the cuts that 

occurred during the recession. The 

employment decline associated with the 2008-

09 recession was especially severe compared 

with the two preceding recessions in 1990-91

and 2001. However, the creation of jobs after 

the most recent recession has been faster; just 

nine months after the official end of the

recession, the manufacturing sector began 

adding jobs. After the 2001 recession,

manufacturing employment continued to 

decline over the years until plummeting in 2008

(as shown in Figure 6). And, even though there

were some scattered months of manufacturing 

employment gains after the end of the 1990-91 

recession, persistent job growth took more than 

two years and employment never made it back 

to the pre-recession level.

Employment projections published by the 

Bureau of Labor Statistics (BLS) suggest that 

manufacturing employment will decline by 

about a half million jobs from 2012 to 2022, as 

the industry becomes more highly innovative, 

productive, and globally-oriented. However, the 

decline projected by BLS is considerably smaller

than the decline over the prior 10 years.

21

 BLS 

expects that this relative stabilization in 

manufacturing employment will be driven by an

increase in the sector’s annual output growth 

 

21 Henderson, Richard. Industry employment and output 

projections to 2022. Monthly Labor Review. Bureau of 

Labor Statistics. Accessed online: 

http://www.bls.gov/opub/mlr/2013/article/industryemployment-and-output-projections-to-2022.htm. Labor 

force projections are based largely on econometric 

models, which, by their very nature, project future 

economic behavior on the basis of a continuation of 

economic relationships that held in the past. For more 

information, see: 

http://www.bls.gov/emp/ep_projections_methods.htm.

rate over the next ten years (from 0.2 percent

over the 2002 to 2012 period to a predicted 2.4

percent from 2012 to 2022).

Notwithstanding these projections, the need to 

replace workers will create millions of job 

openings in the coming years. There will always 

be jobs available in manufacturing as current 

workers leave their jobs for retirement and 

other reasons and new workers are hired to 

replace them. BLS does not estimate job 

openings by industry, but it does by occupation, 

and those numbers are telling. From 2012 to 

2022, BLS projects that the number of workers 

in production occupations (which typically are 

in manufacturing) will ratchet up by about 

76,000 to just over 9.0 million. However, once 

turnover is taken into account, the projected 

number of openings will be more than 2.0 

million spread out over the ten-year period.

Conclusion

The manufacturing sector still faces significant 

challenges. The foreign trade deficit is large and 

persistent. A handful of industries and a handful 

of states account for a disproportionate share 

of its rebound. While gains have been made in 

employment, they have been modest compared 

with the total number of jobs lost during the 

great recession. 

However, U.S. manufacturing is expanding, and 

may have turned a corner. While growth in 

manufacturing has usually followed recessions, 

there is evidence that the manufacturing 

rebound this time around—measured in terms 

of employment and output—has exceeded 

what would have been expected given the 

historical cyclical pattern. The White House 

Council of Economic Advisers (CEA) has 

analyzed the sector’s growth since the 

recession while also attempting to account for 

structural changes such as globalization that 
U. S. Department of Commerce, Economics and Statistics Administration Page 15

have affected manufacturing in the last several 

decades.22,23 Their analysis finds that less than 

one quarter of the employment growth in 

manufacturing since 2010 was due to a cyclical 

rebound and that job gains since then are 

roughly half a million above and beyond that. 

Whether or not this constitutes a “renaissance” 

is open to interpretation. Renaissance or not, 

evidence abounds that U.S. manufacturing has 

emerged out of the recession with renewed 

strength. 

 

22 The White House. 2014 Economic Report of the 

President, page 80. Accessed online May 22, 2014: 

http://www.whitehouse.gov/sites/default/files/docs/full_

2014_economic_report_of_the_president.pdf, analysis 

updated June 2014.

23 “The Case for a Manufacturing Renaissance.” Prepared 

remarks by Gene Sperling, Brookings Institution. Accessed 

online: 

http://www.whitehouse.gov/sites/default/files/docs/the_

case_for_a_manufacturing_renaissance_gene_sperling_7-

25-2013_final_p....pdf. 
Page 16 U. S. Department of Commerce, Economics and Statistics Administration

Acknowledgements

The authors would like to thank the following for their contributions to this report:

Sue Helper, Chief Economist

Rob Rubinovitz, Deputy Chief Economist

David Langdon, Senior Economist and Policy Advisor

Jane Callen, Editor

We also appreciate helpful comments we have received from staff in the following agencies and groups:

Economics and Statistics Administration, Office of the Chief Economist and

Bureau of Economic Analysis

Department of Commerce, Office of the Secretary

White House, Council of Economic Advisers

The authors are economists in the Office of the Chief Economist of the U.S. Department of Commerce’s 

Economics and Statistics Administration.

Technical inquiries:

Office of the Chief Economist

(202) 482-3523

Media inquiries:

Office of Communications

(202) 482-3331

U.S. Department of Commerce

Economics and Statistics Administration

1401 Constitution Ave., NW

Washington, DC 20230

www.esa.doc.gov