While Detroit may be on the edge of bankruptcy and stories of gloom and doom abound about the downfall of the auto industry in the state, it now appears the state has achieved a ‘Mark Twain” as reports of its demise are not quite true.
When Mark Twain’s death was reported in a newspaper, the author replied, “the reports of my death have been greatly exaggerated.” In July, the news for America’s manufacturing sector likewise seems to have revealed that the reports of the death of American manufacturing may have been premature as well. Last month the sector grew for the second month in a row, placing it in line with longer term trends, according to the Institute for Supply Management.
However, this does not necessarily mean a revival of the industry is just around the corner. Manufacturing has been lagging in the economy for years with the country losing nearly 2.5 million jobs over the last 10 years. The primary reason has been a high corporate tax and stringent and burdensome regulations that competitors overseas do not have to deal with. These factors have provided incentives for companies to move their operations overseas to a less hostile environment.
Despite these factors, last year the manufacturing sector produced 12% of the nation’s total economic output. In Indiana, which contributed the most manufacturing output, the number was 28.2% of the total economic output.
When 24/7 Wall Street reviewed the 10 states where manufacturing represents the largest share of the state’s economies some amazing information was revealed.
First, it appears that the states with the biggest manufacturing economies do so because they specialize in different industries. For instance, in Oregon almost $38 billion of the state’s $50 billion manufacturing sector came from the production of computer and electronic product manufacturing. By comparison, in Louisiana, over 10% of the state’s entire economic output in 2011 came from manufacturing petroleum and coal based products.
What may shock many is that Michigan is still in the top 10 states for manufacturing where auto manufacturing accounts for nearly a third of the entire manufacturing output for the state in 2011.
While many states’ manufacturing jobs plummeted during the Obama recession, in recent years the numbers have begun to rebound. In Michigan, the state lost nearly 125,000 manufacturing jobs between January 2008 and 2009. However, in the period from 2009 through the end of 2011 the state has had the fastest pace of manufacturing growth in the nation.
With manufacturing being a key factor in the long term economic health and stability of any country the figures show America appears to have weathered the economic storm better than the rest of the world.
For comments and suggestions, leave a message in the comments section below. Like and Follow our Facebook page for more stories and to stay up-to-date with the latest happenings.