Modern manufacturing involves the processes necessary for the production of specific items and its added components. Before the Industrial Revolution swept across the Western world, this industry required the making of goods by hand. Most families worked from their homes, and agricultural items were the most common form of product available to the consumer. We still use some of the inventions that led to a surge in manufacturing, such as the light bulb and the sewing machine.
In 1908, Charles Sorensen and Henry Ford laid out the vital elements of the modern manufacturing system. This process included the tools, products, people, and machines that were necessary to build the Model T automobile. It would lead to the creation of an assembly line, allowing the company to build 15 million vehicles. Ford also paid his workers enough to afford what they were making, allowing them to become his customers too.
Toyota would be the forerunners of the lean manufacturing movement that started in 1948. By eliminating waste and improving the flow of production, the organization could keep the consumer costs low for their products while improving their profit margins. It wouldn’t be until the 1990s when this concept spread to other segments of the industry.
The future of manufacturing includes robots and artificial intelligence, but these concepts were available in the past as well. The first industrial robot was created in the 1950s, but it was the Televox robot from Westinghouse Electric Company that created useful work for people – and it was invented in 1926.
Important Manufacturing Industry Statistics
#1. Manufacturers contribute over $2.3 trillion to the economy of the United States every quarter. This figure has risen steadily since Q2 2009 when the industry contributed $1.67 trillion to the economy. (Bureau of Economic Analysis)
#2. Between 2009-2018, the value-added output from the manufacturing of durable goods rose from $870 billion to $1.33 trillion in the United States. The contribution from non-durable goods output also rose from $810 billion to $1.06 trillion. (Bureau of Economic Analysis)
#3. The manufacturing industry in the United States accounts for 11.4% of the GDP. (Bureau of Economic Analysis)
#4. For every $1 that gets spent in manufacturing in the United States, another $1.82 gets added to the economy. That figure is the highest multiplier effect of any American economic sector. (National Association of Manufacturers)
#5. For every single employee engaged in full-time work in the manufacturing industry, there are an additional four people hired to work elsewhere. (National Association of Manufacturers)
#6. When the entire manufacturing value chain, plus the supply chains of other industries that are impacted by these activities, are combined, this industry could represent over 30% of the employment opportunities and GDP in the United States. That would create a multiple of $3.60 for every $1 of value-added output. (Manufacturers Alliance for Productivity and Innovation)
#7. There were almost 250,000 firms reportedly active in the manufacturing industry in the United States in 2016. Only 3,837 of them had more than 500 employees. 75% of the firms have fewer than 20 full-time workers. (U.S. Census Bureau)
#8. There are over 12.8 million people employed by the manufacturing industry in the United States today. Since 2009, manufacturers have worked to add 1.37 million jobs to the economy. There are about 8 million people working in the durable goods sector, with the rest employed by the non-durable goods sector. (Bureau of Labor Statistics)
#9. The average salary for a manufacturing worker in the United States is just over $84,000 per year. That figure includes their benefits in addition to their pay. If you take the statistics from all non-farm industries, the average worker earns almost $67,000 per year. That equates to an average wage of $27 per hour. (Bureau of Labor Statistics)
#10. 92% of the employees who work in the manufacturing industry in the United States are eligible for health insurance. This statistic represents one of the highest percentages of workers who are eligible for employer benefits in the country, as 79% is the average for all firms. (Kaiser Family Foundation)
#11. Of the workers who are eligible for health insurance benefits, 82% use an employer plan. The only other industries which have a higher take-up rate in the United States are trade, communications and utilities (85%), state or local government (85%), and wholesale (84%). (Kaiser Family Foundation)
#12. The output per hour for all workers in the manufacturing industry increased by more than 2.25 times since 1987. Productivity is about 1.8 times greater for all non-farm industries as well. The durable goods sector saw even higher outputs, achieving a rate of 2.6 times higher than what was seen 30 years ago. (Bureau of Labor Statistics)
#13. Over the next 10 years, up to 2.4 million jobs are expected to go unfilled in the United States because of a skills gap in the general labor force. Up to 4.6 million manufacturing jobs could be necessary to meet the expected demand. (Deloitte)
#14. Because of the lack of qualified talent in the American economy, there could be a reduction of $454 billion in manufacturing GDP compared to what the maximum contribution could be. Persistent skills shortages over the next 10 years could generate $2.5 trillion in reduce output for the industry. (Deloitte)
#15. In 2014, U.S. manufacturing reached an all-time high for the amount of goods that reached the export industry, bringing in total revenues of $1.403 trillion. Manufacturers nearly equaled that mark in 2018. Since 1990, when the total of exported goods was $329.5 billion, the values have quadrupled. (U.S. Department of Commerce)
#16. Despite the strength of the greenback, lingering trade uncertainties, and slowing economic growth around the world, the exports of American manufactured goods were up 4.7% in 2017 from the year before, and then they rose another 5.6% in 2018. (U.S. Department of Commerce)
#17. Canada and Mexico purchase more manufactured goods from the United States than the next 11 largest trading partners combined for the American economy. The North American counterparts of the U.S. purchased $500.3 billion in manufactured goods in 2018, while the next 11 countries bought a combined $496.5 billion that year. (U.S. Department of Commerce)
#18. The number of American manufactured goods that are headed to China have tripled since 2005, going from $31.9 billion to $98.2 billion in 2018. (U.S. Department of Commerce)
#19. The manufacturing industry in the United States exports almost 50% of its total output. Out of the total exports for manufactured goods, almost half of them were sold to countries where the United States has a free-trade agreement (FTA). Almost $680 billion in goods when to these countries in 2018. (U.S. Department of Commerce)
#20. The global trade in manufactured goods doubled between 2000 to 2017. That means the total value of the industry rose from $4.8 trillion worldwide to $12.2 trillion. The United States currently holds an 8.7% market share, which is up from the 7.6% it held in 2002. (World Trade Organization)
#21. If the manufacturing industry in the United States were taken alone, then it would be the eighth-largest economy in the world today. Only seven other countries, including the U.S., would rank higher than the $2.18 trillion in GDP. The other nations would be China, Japan, India, Germany, France, and the United Kingdom. (Bureau of Economic Analysis)
#22. There was $1.6 trillion in foreign direct investment directed toward the manufacturing industry in the United States in 2017. Over the last ten years, the amount of FDI has more than tripled from the $569.3 billion received in 2006. (Bureau of Economic Analysis)
#23. The American affiliates of foreign multinational firms employ about 2.5 million manufacturing workers in the United States. This statistic represents about 20% of the total employment in this sector. (Bureau of Economic Analysis)
#24. The segments with the most significant levels of employment from foreign nationals include automotive vehicles and parts (407,000), chemicals (364,000), food (301,000), and machinery (228,000). Fabricated and primary metal products, plastics and rubber, and computers/electronics all had more than 150,000 workers as well. (Bureau of Economic Analysis)
#25. Total compensation levels in the manufacturing sectors from the multinational affiliates active in the U.S. manufacturing industry was over $228 billion. Those entities added another $43 billion in research and development activities. (Bureau of Economic Analysis)
#26. The manufacturing industry in the United States performs 64% of the research and development activities that occur in the private sector. (Bureau of Economic Analysis)
#27. Manufacturing research and development rose from $132.5 billion in 2000 to $252 billion in 2017. Pharmaceuticals account for over 30% of the investments in this area, spending over $72 billion annually. Significant contributors include chemicals, electronics, aerospace, and motor vehicles. (Bureau of Economic Analysis)
#28. Over 30% of the energy that the United States consumes every year is due to the activities from the manufacturing industry. When all of the segments are added together, there is 32.3 quadrillion BTU of energy used by this sector. (U.S. Energy Information Administration.
#29. The manufacturing industry in the United States pays almost $20,000 per employee to comply with current government regulations. That’s more than double the average ($9,991) that all agencies pay to stay in compliance across all industries. (National Association of Manufacturers)
#30. Environmental regulations account for 90% of the difference in compliance costs when comparing the average firm from any industry in the United States with the manufacturing industry. (National Association of Manufacturers)
#31. Small manufacturers in the United States with fewer than 50 employees spend 2.5 times more on federal regulations when compared to the expense ratio of larger companies. (National Association of Manufacturers)
#32. The average worker in the United States will put in 44.1 hours per week in the manufacturing to earn their wages. (Data USA)
#33. The average male salary in the U.S. manufacturing industry is $65,894a s of 2019, but it is less than $50,000 per year for women. (Data USA)
#34. Workers in the manufacturing industry are aging rapidly, with the average employee age reaching almost 44 in 2019. (Data USA)
#35. The most common occupation in the manufacturing industry involves miscellaneous production labor, which includes work on semiconductor processors. Assembly, fabrication, first-line supervisors, and freight workers are all common career choices in this field as well. (Data USA)
#36. The share of Americans who are working in factories in the manufacturing industry has fallen from a peak of 30% in 1950 to just 8.5% in 2017. (Forbes)
#37. Despite the decline in overall employment opportunities over the past couple of generations, the manufacturing sector in the United States generates an additional 17.1 million indirect jobs. (Forbes)
#38. The Oakland area, including Berkeley and Hayward, has seen its factory job count jump 22% since 2012 thanks to the surge in the technology sector in the Bay area. Only Orlando, FL, outranks the region by seeing 23.6% growth since 2012, including 7.9% in 2017. Companies like Siemens Energy, Lockheed Martin, and Mitsubishi have brought several advanced manufacturing jobs to the region. (Forbes)
#39. Only 3 metro areas in the United States have more than 200,000 manufacturing jobs in 2017, with Los Angeles leading the way with over 348,000 positions. Despite that status, the area has lost over 20% of its positions over the past ten years. (Forbes)
#40. China is the leading country in terms of manufacturing output for the global industry. It also leads in the percentage of its national output (27%) of $2.01 trillion that is generated by this sector. Poland leads the world with the highest percentage of its labor force employed by the manufacturing industry. (Brookings)
#41. The United States, Japan, and China represent 48% of the world’s current manufacturing output. (Brookings)
Manufacturing Industry Trends and Analysis
The manufacturing industry continues to look for places where automation can reduce costs and improve margins without disrupting the value of the product. Look for firms in this arena to look for ways to incorporate the Internet of Things so that the data can help leaders to identify places of inefficiency.
Predictive maintenance is another trend you will see rising in the next decade. 98% of organizations active in the manufacturing industry say that 60 minutes of downtime will cost them over $100,000. The adoption of tech in this area could reduce maintenance expenses by 20%, cut the number of unplanned outages in half, and extend the life of the machinery by several years.
There will also be more efforts to digitize the supply chains for manufacturing firms. About one-third of the active agencies in this industry have done so already. By 2020, that figure could rise by 75%. By taking these steps, the surge in revenues and exports is expected to continue growing for manufacturers so that they can continue to lead the world in innovation.
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