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    New Blog Address: management.curiouscatblog.net

    Sunday, April 02, 2006

    US Manufacturing Plant Construction

    Topic: ,

    Breaking Ground by Jeff Moad:

    Last year, according to figures from the U.S. Department of Commerce, investment in new manufacturing plant construction increased 25%. That compares to a decline of 6.5% in 2003 and an increase in 2004 of 9.7%

    As we have noted earlier, the United States is by far the leading manufacturer in the world: Global Manufacturing Data by Country and Manufacturing and the Economy (Japan is second and China third and growing rapidly).

    The mini-revival in new-plant development has been enough to slow what until recently had been a prolonged decline in the number of manufacturing plants operating in the U.S. Between 1997 and 2004, according to the U.S. Department of Labor (DOL), the number of plants operating in the U.S. dropped by 10%. In 2005, however, according to DOL figures, the number of plants stabilized at around 336,000.

    Even though the US manufacturing output has continued to increase those gains have come largely from improved efficiency as fewer workers (and fewer plants) are producing the increased output. The decrease in employment is a worldwide phenomonon: Manufacturing Job Losses: USA 2 million, China 15 million.


    Blogger ChinaLawBlog said...

    So are you saying that most of the manufacturing jobs lost in the U.S. are due to increased efficiency, rather than our losing out to China? Productivity in
    China is on the increase as well.

    China Law

    10:50 AM  
    Blogger curiouscat said...

    Yes that is what I am saying. Given that China has lost more than 7 times as many manufacturing jobs as the US it makes little sense to say the economic force is jobs moving to China, in my opinion. China has lost many more jobs than the US.

    Also the China's share of worldwide manufacturing has come more from the rest of the world than from the US.

    The primary worldwide force is increased productivity that is drastically reducing manufacturing employment (everywhere).

    There is also some effect as production is moved from one country to another (say the US to China) but that is not the primary cause of decreased manufacturing employment. That can be seen by the fact that the US manufactures more today than ever (if the primary reason for job loss was was the US losing manufacturing to China then manufacturing output in the US should have declined).

    Yes there are many examples of manufacturing that was done by a plant in the US 5 years ago and now that manufacturing is done in China. But still after everything the USA is still manufacturing more than anyone else and more than it ever has.

    12:32 PM  

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