Is US Manufacturing Finally Getting Back to Work? « EMSI | Economic Modeling Specialists Intl.

• 
• 
• About
• Contact
• login

From time to time we like to blog about the manufacturing sector (see here, here, and here). This is because manufacturing has a huge impact on job and income formation and, due to very high multiplier effects, tends to be a significant player when we talk local economic development.

Just last week, several sources wrote about how U.S. manufacturing is actually performing quite well when compared to China and Europe. You can read those articles here and here.

To get a better handle on the bright spots, we looked deep into our most recent dataset to see what stands out. We used all the manufacturing sub-sectors (as classified by four-digit NAICS) and filtered for those sectors with the most job growth and total new jobs since 2009. The industries that rose to the top were motor vehicle parts manufacturing (NAICS 3363), machine shops (NAICS 3327), and agriculture, construction, and mining machinery manufacturing (NAICS 3331), as you can see below:

NAICS Code	Description	2009 Jobs	2012 Jobs	% Change	2012 Avg. Annual Wage
3363	Motor Vehicle Parts Manufacturing	417,346	471,798	13%	$73,036
3327	Machine Shops; Turned Product; and Screw, Nut, and Bolt Manufacturing	319,353	364,502	14%	$60,253
3331	Agriculture, Construction, and Mining Machinery Manufacturing	208,263	238,270	14%	$89,449
	Total	944,962	1,074,570	14%	$72,340

1. Motor vehicle parts manufacturing, with nearly half a million jobs, is the largest employer. Not surprisingly, many of these jobs are centered in the Great Lakes region. From 2009 to 2012, motor vehicle parts grew by 55,000 new jobs (13% growth), which is impressive given the beating (32% decline) it took from 2007-2009. Employment in this industry hasn’t recovered to pre-recession levels, but it’s good to see some jobs returning.

2. The machine shops industry is second on the list. From 2009-2012, it grew by 45,000 jobs (14%). The most striking thing is that those 45,000 jobs are a huge percentage of the 52,000 jobs it lost from 2007-2009. Machine shops seem to be gaining back what the recession snatched.

3. The third setor of note is agriculture, construction, and mining machinery manufacturing, which gained 30,000 jobs (also 14% growth) since 2009. It’s worth noting that this industry lost a mere 20,000 jobs from 2007-2009. So it hasn’t simply regained its footing; it appears to be shrugging off the recession like last year’s leaves.

Agriculture, construction, and mining machinery manufacturing is the smallest employment sector of the three, but has the highest average annual wage (nearly $90,000). Illinois, Iowa, and Texas have the highest concentration of workers in this industry.

Altogether these three sub-sectors added 130,000 new jobs in three years. Not spectacular growth, but decent all things considered. Areas where these industries are highly concentrated must be feeling some sort of relief as a result. Here is a graphical overview of all three industries.

One more quick comment: an estimated 50% of the workforce in these three industries over the age of 45, which means that now and in the coming years these industries could have a fair bit of turnover. Even if the sectors do not continue to produce a lot of new jobs, there could be decent demand for younger workers as a result of retirements.

Top States

Below we have listed employment by state for these three industries. Here are some observations:

• Michigan, Texas, Ohio, Illinois, and Indiana employ the most workers. Michigan is the clear leader with over 130,000 jobs in 2012. It is also interesting to note the relative growth percentages for each state — 24% growth in MI, 22% growth in TX, 8% growth in OH, 14% growth in IL, 20% growth in IN.

• The states with the highest concentration of employment in these industries are Michigan (3.84, which means that the state has nearly 4 times the concentration of these jobs when compared to a typical region), Indiana (2.99), Iowa (2.8), Ohio (2.30), and Kentucky (2.24). All of these states have concentrations at least twice the national average for these industries, and can therefore be thought of as specialized areas for these jobs.

• Only eight states actually lost jobs in these industries from 2009-2012. California and Missouri were the biggest losers. Again, it’s a really good sign that 42 states showed job growth for these valuable manufacturing sectors. Note: Washington, D.C. has zero jobs in any of these industries.

State Name	2009 Jobs	2012 Jobs	Change	% Change	2012 Avg. Annual Wage	2009 National Location Quotient
Michigan	104,810	130,363	25,553	24%	$86,064	3.84
Texas	82,831	100,883	18,052	22%	$88,609	1.1
Ohio	81,985	88,562	6,577	8%	$69,854	2.3
Illinois	66,791	76,032	9,241	14%	$93,497	1.68
Indiana	58,535	70,300	11,765	20%	$68,511	2.99
California	60,214	59,411	-803	-1%	$65,330	0.55
Pennsylvania	36,274	42,229	5,955	16%	$65,761	0.92
Tennessee	33,432	41,419	7,987	24%	$62,414	1.76
Wisconsin	33,800	37,601	3,801	11%	$71,635	1.77
Iowa	29,766	36,625	6,859	23%	$77,180	2.8
Kentucky	28,594	32,236	3,642	13%	$59,175	2.24
New York	27,357	28,672	1,315	5%	$70,567	0.45
North Carolina	23,925	25,814	1,889	8%	$66,651	0.84
Alabama	21,065	24,889	3,824	18%	$60,253	1.56
Minnesota	20,886	24,050	3,164	15%	$65,508	1.11
South Carolina	20,136	22,244	2,108	10%	$62,824	1.54
Oklahoma	16,445	20,084	3,639	22%	$63,483	1.46
Georgia	18,066	19,736	1,670	9%	$61,195	0.64
Louisiana	14,542	16,365	1,823	13%	$75,929	1.07
Nebraska	10,988	12,236	1,248	11%	$65,495	1.64
Missouri	13,811	11,980	-1,831	-13%	$53,584	0.72
Massachusetts	10,718	11,856	1,138	11%	$73,336	0.47
Connecticut	11,086	11,759	673	6%	$72,967	0.95
Virginia	10,606	11,505	899	8%	$60,178	0.4
Arkansas	9,587	11,379	1,792	19%	$48,567	1.14
Kansas	10,839	11,047	208	2%	$60,760	1.1
Florida	10,630	10,966	336	3%	$55,646	0.2
Washington	6,936	8,318	1,382	20%	$59,540	0.33
Arizona	7,371	7,716	345	5%	$64,791	0.42
Oregon	6,462	7,279	817	13%	$60,130	0.54
Utah	6,386	7,216	830	13%	$63,610	0.75
Colorado	6,204	6,919	715	12%	$59,542	0.38
Mississippi	5,730	6,486	756	13%	$52,561	0.71
New Jersey	5,777	5,761	-16	0%	$68,973	0.21
North Dakota	5,180	5,657	477	9%	$59,169	1.95
West Virginia	5,028	5,275	247	5%	$69,287	1
South Dakota	3,066	3,866	800	26%	$52,258	1.03
New Hampshire	3,378	3,574	196	6%	$65,375	0.75
Maryland	3,279	3,098	-181	-6%	$67,953	0.18
Maine	2,558	2,935	377	15%	$62,766	0.58
Idaho	2,133	2,237	104	5%	$51,201	0.46
Nevada	1,742	1,823	81	5%	$54,168	0.22
New Mexico	1,217	1,292	75	6%	$53,175	0.21
Vermont	1,261	1,234	-27	-2%	$57,219	0.56
Rhode Island	1,243	1,225	-18	-1%	$54,235	0.38
Wyoming	909	906	-3	0%	$73,911	0.44
Montana	652	713	61	9%	$46,653	0.2
Delaware	411	492	81	20%	$67,660	0.14
Alaska	243	246	3	1%	$100,175	0.1
Hawaii	79	56	-23	-29%	$57,890	0.02
District of Columbia	0	0	0	0%	$0	0
Total	944,962	1,074,570	129,608	14%	$72,340

Conclusion

So, when we talk about these sectors, what jobs are we actually talking about? If someone were interested in pursuing one of these industries, what would they need to do? To help, we pulled a list of the top occupations that actually staff these three industries.

Not surprisingly, machinists and team assemblers sit at the top. Currently, there are over 240,000 of these workers across the three sectors and they make up 22% of total employment. Both of these jobs only require on-the-job training and the pay is fairly low.

In fact, a vast majority of the occupations on the list (11 out of 14) are related to production and only require work experience or on-the-job training. One occupation is related to transportation and the other two are engineering occupations (mechanical and industrial engineers).

Industrial engineers and computer controlled machine tool operators are the fastest-growing occupations. Both grew by 20%. Also note, all of these occupations experienced some sort of growth since 2009. Again, a pretty good sign for manufacturing in the U.S.

SOC Code	Occupation	Employed in Industry Group (2009)	Employed in Industry Group (2012)	Change	% Change	% of the Total Jobs in Industry Group (2012)	Median Hourly Earnings	Education Level
51-4041	Machinists	115,019	132,136	17,117	15%	12.30%	$18.14	Long-term on-the-job training
51-2092	Team Assemblers	96,511	110,156	13,645	14%	10.30%	$12.94	Moderate-term on-the-job training
51-4011	Computer-Controlled Machine Tool Operators, Metal and Plastic	37,599	45,048	7,449	20%	4.20%	$16.65	Moderate-term on-the-job training
51-4121	Welders, Cutters, Solderers, and Brazers	38,360	44,203	5,843	15%	4.10%	$16.67	Postsecondary vocational award
51-1011	First-Line Supervisors/Managers of Production and Operating Workers	36,502	41,673	5,171	14%	3.90%	$24.93	Work experience in a related occupation
51-9061	Inspectors, Testers, Sorters, Samplers, and Weighers	28,194	32,086	3,892	14%	3.00%	$15.96	Moderate-term on-the-job training
51-4031	Cutting, Punching, and Press Machine Setters, Operators, and Tenders, Metal and Plastic	27,402	30,288	2,886	11%	2.80%	$14.02	Moderate-term on-the-job training
51-2099	Assemblers and Fabricators, All Other	21,777	24,934	3,157	14%	2.30%	$14.14	Moderate-term on-the-job training
51-4034	Lathe and Turning Machine Tool Setters, Operators, and Tenders, Metal and Plastic	21,105	22,882	1,777	8%	2.10%	$16.29	Moderate-term on-the-job training
51-9198	Helpers--Production Workers	16,465	18,740	2,275	14%	1.70%	$10.74	Short-term on-the-job training
17-2112	Industrial Engineers	15,151	18,194	3,043	20%	1.70%	$36.21	Bachelor's degree
53-7062	Laborers and Freight, Stock, and Material Movers, Hand	15,594	17,210	1,616	10%	1.60%	$11.19	Short-term on-the-job training
51-4111	Tool and Die Makers	15,054	17,202	2,148	14%	1.60%	$22.84	Long-term on-the-job training
17-2141	Mechanical Engineers	14,198	16,572	2,374	17%	1.50%	$37.25	Bachelor's degree

Data and analysis from this report came from Analyst, EMSI’s web-based labor market tool. Please contact Rob Sentz (rob@economicmodeling.com) if you have questions. Follow us @desktopecon.

10:46 am on August 29th, 2012
Categories: Careers, Data & Analysis, Front Page, Industries, Occupations.
Tags: analyst, emsi data, growth, machine shops, machinery, Manufacturing, motor vehicles, team assemblers.