We found The Wall Street Journal’s recent piece on the Top 10 Dying Industries, via IBISWorld, pretty interesting. As the WSJ describes it, some industries didn’t just see temporary decline during the recession – some won’t recover and will slowly (or quickly) disappear. IBISWorld’s data format is a little different than ours, and its categories are somewhat obscure, but we thought it would be interesting to pull together a similar table with the associated job data.
With one major exception, all of these industries have seen some shakeup. But loss by itself doesn’t tell the full story. Wired telecommunications carriers lost the most jobs, but are tied with newspaper publishing for the second smallest percentage change on the list. This is probably because they’re entrenched industries and will take longer to become totally obsolete. Contrast those industries with photofinishing. Photofinishing has been a smaller industry all along, but their percent loss is at 68%. Consider the last time you looked at snapshots that weren’t digital, and then say a little prayer for the photofinishing industry.[table "66" not found /]
The one industry on this list that is not like the others is video postproduction services. As we mentioned earlier, there’s not an exact relationship between our industry groups and those used in this study, so where they’ve found overall decline we’ve found slight growth. The interesting thing is that this industry goes to one more digit of detail and splits in half to become teleproduction and other postproduction services and then other motion picture and video Industries. The teleproduction industry is growing by 2,573 jobs and then the other motion picture industry is losing 2,352 jobs. There’s pretty much an inverse relationship between these two industries, and that’s where that slight gain comes from. In the report from IBISWorld that the Wall Street Journal article references, IBIS points out that digital postproduction is a very important, but that most groups simply don’t farm that work out and do it in house. This might mean that what we’re seeing in this data is some of that shift, especially since the job gain and loss is so directly proportional.
Is There Life in Manufacturing?
Before we get to the better news, let’s look at a quick reminder about what manufacturing has been doing over the past 10 years. From 2001 to 2010 the manufacturing sector lost 4.7 million jobs nationally. Pretty dismal. However, there are industries in the sector that show growth. If we look from 2001-2010 the top 10 industries look like this:[table "67" not found /]
This still isn’t the good news. As the table demonstrates, most of the industries showing high growth from 2001 to 2010 have slackened considerably from 2009 to 2010, and many of them have declined. We would hope to be seeing some hint of recovery in these industries, but instead we’re seeing loss.
To zero in on industries showing current growth in the manufacturing sector, we’ll look at the top 10 industries showing the most growth from 2009 to 2010.[table "68" not found /]
As you run over this list you’ll probably get the take away pretty quick. The lesson of this table is that the federal auto manufacturing bailout had an immediate positive effect. In an already declining industry sector the bailout has enabled auto manufacturing to recover, very slightly, after a long period of decline.
Of the three industries on this list not directly related to auto manufacturing (all other plastics mfg., wet corn milling, and iron and steel mills) only wet corn milling showed growth from 2001 to 2009. This means that nine of the top 10 manufacturing industries that have grown from 2009 to 2010 are industries showing a sudden turn-around, without a growth trend in place. Because these correlations are so close, we took a quick look at the relationship between auto manufacturing and iron and steel milling in our input-output model and did not find a strong industry tie. The same was true for auto manufacturing and all other plastics mfg.
Life vs. Death
First we looked at dying industries. Then we looked at industries within a dying industry sector that are recovering because of massive infusions of money from the government. Is it all really that depressing out there?
Of course, this isn’t a comprehensive look at industry growth. Everyone knows that the health sector is growing, and we’re starting to spot other reasons for hope. But the truth is that the US economy recently underwent a major shakeup, and hasn’t totally bounced back yet. As far as manufacturing goes, there’s not a ton of good news right now. But we’re going to keep tabs on it and let you know what we find.