Where Manufacturing Is Thriving In The U.S.

Where Manufacturing Is Thriving In The U.S.

Jun 19, 2017

By Joel Kotkin and Mike Shires, Forbes Throughout the dismal presidential campaign, the plight of America’s manufacturing sector played a central role. Yet despite all the concerns raised about factory jobs leaving the country, all but 18 of the country’s 70 largest metropolitan regions have seen an uptick in industrial employment since 2011. And despite the slowdown in car sales, the job count continues to expand, albeit more slowly. Although the share of industrial jobs has shrunken from 10.5% of all nonfarm employment in 2005 to 8.5% today, manufacturing continues to have an outsized influence on regional economies, as is spelled out in the latest paper from the Center for Opportunity Urbanism. This stems in large part from the industrial sector’s productivity gains since 2001 — almost twice as much as the economy-wide average, according to the Bureau of Labor Statistics — and it has a far higher multiplier effect (the boost it provides to local job and wealth creation) than virtually any other sector. Manufacturing generates $1.40 in economic activity for every dollar put in, according to the U.S. Bureau of Economic Analysis, far greater than the multiplier generated by business services, information, retail trade or finance. To determine the places where manufacturing growth is the strongest, we looked at employment in the sector over time, assessing short-, medium- and long-term trends going back to 2005 and adding in variables for persistence and momentum as well. The results of these trends, based on three-month averages, are normalized and each MSA is assigned a score based on its relative position in each area.  The rankings this year produced some surprising results, as well as some familiar stories. Red States And The Rust Belt Win  Nine of this year’s top 10 regions for manufacturing job growth are in red states, led by top-ranked Louisville-Jefferson County, which straddles the border between Kentucky and Indiana. Since 2011, manufacturing employment in the metropolitan area has expanded 30.2% to a total of 83,300 jobs, led by a resurgent auto industry that accounts for 27,000 jobs in the area. Due to a slowdown in auto sales, the job count may be peaking, but the hub of the Bluegrass State has...

After-Tax U.S. Manufacturing Profits Up 19.9% from Q1 2016…

After-Tax U.S. Manufacturing Profits Up 19.9% from Q1 2016…

Jun 6, 2017

“After-Tax U.S. Manufacturing Profits Up 19.9% from Q1 2016 to Q1 2017” By Terence P. Jeffrey, CNSNews.com The after-tax profits of U.S. manufacturing corporations increased from $118,199,000,000 in the first quarter of 2016 to $141,672,000,000 in the first quarter of 2017, an increase of $23,473,000,000 of about 19.9 percent, according to data released today by the Census Bureau. According to the Census Bureau, this data only counts the after-tax profits on manufacturing done within the United States. It does not count the after-tax profits that a U.S.-based manufacturing corporation may earn from products it makes in foreign countries. After-tax profits of U.S. manufacturing also increased from $131,727,000,000 in the fourth quarter of 2016 to the $141,672,000,000 reported for the first quarter of this year—a climb of $9,945,000,000 or about 7.5 percent from one quarter to the next. “U.S. manufacturing corporations’ first quarter 2017 unadjusted after-tax profits totaled $141.7 billion, up $23.5 billion from the after-tax profits in the first quarter of 2016, and up $9.9 billion from the after-tax profits of $131.7 billion recorded in the fourth quarter of 2016,” the Census Bureau said in the press release for its Quarterly Financial Report on U.S. manufacturing, mining, wholesale trade and selected service industries. In addition to these “unadjusted” numbers, the Census Bureau also publishes “seasonally adjusted” numbers for quarterly manufacturing profits. In the seasonally adjusted numbers, after-tax profits for manufacturing corporations in the first quarter this year were up $24 billion from the first quarter last year, and up $3.5 billion from the fourth quarter of last year. “U.S. manufacturing corporations’ seasonally adjusted after-tax profits in the first quarter of 2017 totaled $146.5 billion, up $3.5 billion from the after-tax profits of $142.9 billion in the fourth quarter of 2016, and up $24.0 billion from the after-tax profits of $122.45 billion recorded in the first quarter of 2016.” Actual sales for U.S. manufacturing corporations were up $94.2 billion from the first quarter of last year, according to the Census—rising from $$1,4881.8 billion in the first quarter of 2016 to $1576.0 billion in the first quarter of 2017....

U.S. Reshored Jobs Rising — But What Will 2017 Bring?

U.S. Reshored Jobs Rising — But What Will 2017 Bring?

Jun 2, 2017

By Taras Berezowsky, Metal Miner Looks like the tide has finally turned. Extending that metaphor is easier now than it’s ever been for us writing on this topic: the reshoring of American manufacturing from abroad — and specifically, the net gains in jobs that we’ve been seeing in 2016 and early 2017 as compared with the trends in the early 2000s. (I envision the emigrating jobs huddled together for warmth on a seaworthy vessel, with Shanghai getting smaller in the distance as the Pacific waves toss the boat ever closer toward Long Beach… if only it were that poetic.) Back to reality. The Reshoring Initiative has just released its 2016 Data Report, and the numbers seem to tell a rosy story. According to the report press release, “in comparison to 2000-2003, when the United States lost, net, about 220,000 manufacturing jobs per year to offshoring, 2016 achieved a net gain of 27,000.” “The numbers demonstrate that reshoring and FDI are important contributing factors to the country’s rebounding manufacturing sector,” the release concluded. But of course, it’s not that easy. Major policy changes will have to be made or improved to continue the reshoring trend (which is still in its early stages), according to Harry Moser, founder of the Reshoring Initiative. In a way, the U.S. should aspire to host conditions like those in Germany, Moser told me, including a supportive government, VAT, low healthcare costs, and an appreciation of the benefit of local sourcing. “Germany has a huge trade surplus and manufacturing at about 20% of employment,” Moser said, “and [the U.S. has] a huge trade deficit and manufacturing at about 10%.” RELATED: We chatted with Moser in a video interview a few years ago when the latest results within the trend were gaining steam (below). The Good News for U.S. Metals Jobs According to the full report, in 2016, fabricated metals had a good showing with the fourth-most reshored jobs by industry category. Also, primary metals moved ahead of non-metallic minerals: Good to see that toys and hobbies industry jobs are coming back… but not nearly as quickly. The “Good/Bad/Who Knows” News for U.S. Metals Jobs One aspect of our new economy that’s...

Manufacturing Growth on Autopilot in May

Manufacturing Growth on Autopilot in May

Jun 1, 2017

By Bill Koenig, AdvancedManufacturing.org Manufacturing economic growth remained on autopilot in May,  the Institute for Supply Management (Tempe, AZ) said today. The institute’s PMI, which measures economic activity in manufacturing, was 54.9% last month, a tick up from April’s 54.8%, according to a monthly report. May was the ninth consecutive month of expansion in manufacturing. New orders, production and employment were all in positive territory last month, the group said. The PMI is “still a very strong number,” Timothy R. Fiore, the new chair of ISM’s Manufacturing Business Survey Committee, said on a conference call. Fifteen of 18 industries reported growth during the month, including machinery, primary metals, miscellaneous manufacturing, transportation equipment, fabricated metal products and petroleum and coal products. Two industries, apparel and textile mills, reported economic contraction. The ISM report is based on a survey of 350 purchasing and supply executives. A reading above 50% indicates expansion and below 50% contraction. The PMI has averaged 53.9% the past 12 months and 56.1% for the first five months of 2017. The index hasn’t been below 50% since August. ‘Turn of a Dime’ The group’s New Orders Index perked up to 59.5% in May from 57.5% the month before. Fourteen of 18 industries reported increases in orders, including primary metals, machinery, fabricated metal products, petroleum and coal products and transportation equipment. Only apparel reported a decline in orders. The institute’s Production Index cooled to 57.1% in May, down from 58.6% in April. Fourteen of 18 industries reported a boost in output, including primary metals, fabricated metal products, miscellaneous manufacturing, machinery and transportation equipment. ISM’s Employment Index advanced to 53.5% last month, up from 52% in April. Eleven of 18 industries reported job growth, including miscellaneous manufacturing, machinery and petroleum and coal products. Five industries reported job cuts, including fabricated metal products and transportation equipment. Fiore said the production and employment results may be tied together. Some manufacturers are have difficulty “finding qualified people on a turn of a dime,” he said. “Our ability to staff up is impacting the production...

Reshoring Exceeded Offshoring in 2016: Policy Changes Needed…

Reshoring Exceeded Offshoring in 2016: Policy Changes Needed…

May 15, 2017

Reshoring Initiative 2016 Data Report Reshoring Exceeded Offshoring in 2016: Policy Changes Needed to Maintain Momentum Kildeer, IL. May 15, 2017 — For the first time in decades, more manufacturing jobs are returning to the United States than are going offshore. The combined reshoring and foreign direct investment (FDI) trends grew by over 10 percent in 2016, adding 77,000 jobs (tying the 2014 record) and exceeding the rate of offshoring by about 27,000 jobs. The 2016 results bring the total number of manufacturing jobs brought back from offshore to more than 338,000 since the manufacturing employment low of February 2010. There are still huge opportunities and challenges to bringing back all the 3 to 4 million manufacturing jobs cumulatively lost to offshoring. The rate of job return announcements doubled in November 2016 and hit an all-time peak monthly record in January 2017. Clearly, government policy changes and expectations of those changes are key to accelerating the trend. Overview The Reshoring Initiative’s 2016 Reshoring Report contains data on U.S. reshoring and FDI by companies that have returned U.S. production or sourcing from offshore. The report includes cumulative data from 2010 through 2016, as well as highlights from the first quarter of 2017. In comparison to 2000-2003, when the United States lost, net, about 220,000 manufacturing jobs per year to offshoring, 2016 achieved a net gain of 27,000. The tide has turned. The numbers demonstrate that reshoring and FDI are important contributing factors to the country’s rebounding manufacturing sector. The overall trend was up from 2015 due to anticipation of potential policy changes that will make the United States more competitive, continued rising wages overseas, and increased use of total cost of ownership for sourcing decisions. “We publish this data annually to show companies that their peers are successfully reshoring and that they should reevaluate their sourcing and siting decisions,” said Harry Moser, founder and president of the Reshoring Initiative. “With 3 to 4 million manufacturing jobs still offshore, as measured by our $500 billion/year trade deficit, there is potential for much more growth. We call on the administration and Congress to enact policy changes to make the United States competitive again. Our Competitiveness Toolkit is...