Manufacturing is still alive in the USA

A recent news item I heard on the radio announced that China will surpass the U. S. as the largest manufacturing nation in the world some time next year. If the general broadcast media are your primary source of news, you’re probably surprised that the U. S. hasn’t already been surpassed by Japan, Korea, India, and most other industrialized nations.

Alan Hitchcox
Alan Hitchcox
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There’s no denying that manufacturing in North America has shrunk in the last several decades. But manufacturing certainly is not dead. In fact, according to an economic report by Daniel J. Meckstroth, Chief Economist at The Manufacturers Alliance, Arlington, Va., ([email protected]), manufacturing grew at a 6% annual rate in the three months ending in January 2010 and grew at a 7% annual rate in the three months ending in April 2010.

Meckstroth reports, “A recovery is clearly well underway. Monthly data for manufacturing production indicate that the recession, which started in January 2008, ended in June 2009. Manufacturing production fell 17% from December 2007 to June 2009. In the 10 months from June 2009 to April 2010, manufacturing production has rebounded about 7%.

“The industrial recovery is stronger than the recovery in the general economy. The pace of the manufacturing rebound has been so strong that, fortunately, employment is starting to grow. Since the beginning of the year, manufacturing has added about 100,000 jobs.”

So, manufacturing is not dead. But it has become downsized, more automated, and a bit more specialized. The U. S. can’t compete with cheap labor from overseas, but what we can do is automate manufacturing to eliminate the need for manual labor. This is where high-speed pneumatics can help keep existing manufacturing in North America. Another opportunity lies with making specialized machines that would be difficult to reverse engineer and manufacture overseas. The wide variety of specialized agricultural machines serves as a prime example, and hydraulics technology is an integral part of this innovative equipment.

Perhaps a greater threat to the U. S. economy is our continuing shift to a service economy. For one thing, most firms seem to have pretty low standards when it comes to customer service. Moreover, many customer service jobs have been replaced by software or overseas personnel. So what will happen as we shift more and more to a service economy where jobs in the service sector continue to disappear?