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Overview
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Why manufacturing?
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U.S. manufacturers produce more today than at
any other time in U.S. history.
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The U.S. manufacturing sector is the
eighth-largest economy in the world, nearly equal
to China's entire world economy.
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Manufacturing is one of the primary engines of
wealth generation in America.
-- Pumps out $1.4 trillion in annual output
-- Employs more than 14 million workers
-- Accounts for 12% of the GDP and two-thirds of
exports of goods and services
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For every dollar of manufactured goods
produced, an additional $1.37 of economic activity
is generated.
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The U.S. manufacturing sector leads in
innovation:
-- Accounts for 57% of industrial R&D
-- The new products and processes developed in
manufacturing contribute significantly to U.S.
competitiveness, economic leadership and the
current high standard of living.
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Four out of five manufacturers anticipate
their revenues to increase in 2007 vs. 2006.
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Nearly half of manufacturers anticipate their
level of capital equipment spending will rise in
2007.
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$1.5 billion of containerized shipments pass
through U.S. ports each day.
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The manufacturing sector will increase its
spending on IT services to a total of $455.7
billion by 2009.
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Manufacturing construction is projected to
increase every year, reaching more than $25
billion by 2009.
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Through October 2007, U.S. manufacturing technology consumption is up 6.3% compared with 2006.
Consumption for the first ten months
of the year totaled $393.4 million.
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U.S. ports and waterways handle more than 2
billion tons of domestic and import/export cargo
annually.
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By 2020, forecasts predict that the U.S.
transportation system will handle cargo valued at
more than $28 trillion, of which $4 trillion will
pass through our nation's ports.
Sources:
The Manufacturing Institute, National Association of Manufacturers and
RSM McGladrey Inc., The Future Success of Small and Medium
Manufacturers: Challenges and Policy Issues
IW/MPI 2006 Census of Manufacturers
Gartner, Forecast: Manufacturing IT Spending, Worldwide, 2005-2009
U.S. Census Bureau of Labor Statistics
Manufacturing Construction FMI Corp.
U.S. Machine Tool Consumption: A joint statistical program of AMT and
AMTDA
Council of Supply Chain Management Professionals
American Association of Port Authorities
Manufacturing outlook 2007
Compiled
Nov. 2006
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Spending in the U.S. on
research and development should reach $336 billion
in 2007, up from $329 billion in 2006. Industry-manufacturing
accounts for
about 63 percent of that spending--so we can look forward to lots of
innovations and new products coming out of manufacturers' labs in the
coming years.
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The latest Census Annual Survey of Manufacturers report (issued Nov.
2006)
shows manufacturers in the U.S. shipped goods worth $4.73 trillion in
2005
and spent almost $130 billion on new buildings and equipment--both are
records or near-records.
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Automakers, governments, utilities and oil and gas companies are
pouring
billions into hydrogen research -- more than $10 billion will be spent
on
hydrogen research over the next ten to fifteen years worldwide. This
will
lead to a mass-market set of manufacturing innovations, similar to the
innovations that first launched the modern auto, train, and shipping
industries.
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One trend that will continue in 2007: manufacturing jobs will continue
to
be shipped from large U.S. cities to smaller U.S. cities, like
Wheeling,
W.Va. The reason: these cities can deliver employees with a strong work
ethic, and relatively low wages.
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With advanced manufacturing technology, businesses are able to deliver
on
mass customization. This is part of a broader trend toward faster,
more
specialized manufacturing. The customizing concept, conceived of
decades
ago, is to crank out one-of-a-kind, custom-fit goods at
mass-production
prices.
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Another manufacturing trend we saw in 2006: market customization. One
example, developed by Trek Bicycles, is where the company offers a
commuter
bike designed for the rainy Northwest, and another commuter bike, with
more
urban chic, for New York. The auto and engine industries are also
doing
mass or market customization.
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On November 20, 2006, The Conference Board reported that the Composite Index
of
Leading Economic Indicators increased 0.2% in October, following a
0.4%
increase in September.
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A couple of growth markets for U.S. manufacturers in 2007, as noted by
Frost & Sullivan and other research firms: wind power generation
units,
selected consumer electronics, including portable digital audio and gaming
devices, and food processing that involves nanotech and biotech
components
and processes.
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Some auto brands in the U.S
are thriving. On November 18, 2006, Toyota's San
Antonio, Texas assembly plant started production. The goal: build
200,000
Tundra trucks each year. There's enough space at the site to build a
second production line.
Every other Toyota plant in North America has been doubled, or more, in
output, in the recent past.
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Japan's Mainichi newspaper recently reported that Toyota plans a new plant
in the upper Midwest to build 200,000 Yaris
compact cars. That plant would
start in 2009. The same article reported that Toyota also plans a
North
American SUV plant by 2010.
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In March 2006, Kia
Motors Corp. announced that it would build a $1.2
billion automotive assembly plant in the city of West Point, Ga.,
creating
more than 2,800 jobs at the plant. The business deal includes a commitment
from five supplier companies to locate in Georgia, creating an
additional
2,600 jobs.
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The November 2006 election upheaval could be good for manufacturing.
"We are optimistic that the incoming legislators share our interest in
strengthening the U.S. economy and creating more jobs," said Jay
Timmons,
Senior Vice-President for Policy and Government Relations of the
National
Association of Manufacturers.
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The fact that there were no major storms in the U.S. this past
hurricane
season helped moderate energy prices for manufacturers. Also, the
surging
U.S. stock market shows investors have a lot of confidence in U.S.
manufacturers.
San Diego State University is starting a one-year global MBA program
in
manufacturing-as part of the program, students will spend 12 weeks in
China, attending classes and visiting manufacturing facilities and
corporate offices.
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U.S. manufacturing companies consumed more than $3.5 billion in
manufacturing technology in the first 11 months of 2006, an increase
of 29.4% compared with the same period in 2005.
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It's easy to get the impression that
U.S. manufacturing is dying -- and that China is the culprit. The
numbers, however, tell a different story.
Download this two-page PDF
published by the US-China Business Council, which debunks some of the
most common myths about U.S. and Chinese manufacturing.
Graph: Manufacturing spends more on capital goods
than any other sector of the economy
The manufacturing sector spent $165.2 billion on capital goods in
2005, an increase of 5.5 percent from 2004. Of the total spending by
this sector, $33.7 billion was for structures, and $131.5 billion was
for equipment.
Investment spending by durable goods manufacturers totaled $92.4
billion, an increase of 8.6 percent from the prior year. Of this
total, $14.8 billion, was for structures, while expenditures for
equipment amounted to $77.6 billion. The motor vehicle and parts
industry was the largest durable goods investor, spending $23.5
billion in 2005. The semiconductor industry was the second
largest durable goods investor, at $10.3 billion. Nondurable
goods manufacturers spent $72.8 billion on capital goods in 2005.
Spending for structures was $18.9 billion, and for equipment, $54.0
billion. The food manufacturing industry was the largest spender in
this category in 2005 with $14.3 billion, followed by the petroleum
and coal products industry with spending at $10.3 billion, and the
pharmaceutical and medicine manufacturing industry at $10.1 billion.
Source: 2005 Annual Capital Expenditures Survey, U.S. Census
Bureau, March 2007 report
More resources for manufacturing
data
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here to view graph