Conventional wisdom holds that manufacturing's recent job surge is an aberration, that automation and robotics, combined with cost savings from offshore production, will diminish the need for U.S. workers and the importance of manufacturing at the same time.
It's not a trivial conclusion. Jobs matter. People starting a career or business, or developing a city or state economy, want to bet on a sure thing. Is manufacturing growing or not?
The narrative CNBC favors is that it's retreating, citing Bureau of Labor Statistics last month to argue that President Trump's manufacturing-related trade policies are falling short -- but more, to suggest that "national manufacturing appears to have peaked":
It's reasonbable to believe that jobs "have peaked." In the same report, the Bureau of Labor Statistics forecasts more net manufacturing job losses in the future -- from roughly 12.5 million U.S. jobs in 2018 to 12 million in 2028, falling from 8 percent of total U.S. employment to about 7 percent during that time. A decline would lengthen manufacturing's downward trend from 13.4 million jobs in 2008 -- and earlier, pre-Great Recession, when 16 million Americans worked in manufacturing.
Yet both Obama and Trump have presided over a manufacturing employment surge, and as we've chronicled, manufacturing is today a tale of diverse industries and regions. The sector is growing in some states as it retreats in others. For example, Western states, our primary focus, are witnessing the emergence of a new industrial makeup that seems to upset conventional wisdom.
As the New York Times has noted, America's West is a new engine of manufacturing employment, with its counties growing at twice the rate as their Rust Belt counterparts. In the same period that CNBC's graph depicts job losses in Michigan, Ohio, and Pennsylvania -- manufacturing employment in Colorado, Washington, Oregon, California, and Arizona -- bellwether economies in the West -- stayed the same or grew slightly.
We'll dig in deeper to Colorado and California manufacturing employment in the weeks ahead, but the message seems clear enough: Industry mix means everything. In Colorado, we know that food and beverage is the state's fastest growing manufacturing industry. When combined with high-tech clusters across a range of industries like aerospace and bioscience along with construction-related fabrication that shows no signs of slowing, manufacturing here continues to challenge conventional wisdom. So far it's lost on CNBC. They surmise: "It's official: Manufacturing is getting crushed."
In some industries, and in some places, maybe. But here and other pockets across the U.S., it's at the center of innovation and growth in industries expanding along new fault lines, in communities that value local production. Or value like-minded companies that outsource manufacturing in regional or international supply chains. It's the next best thing. Companies like Teton Waters Ranch, featured this week, a manufacturer to be sure but not manufacturing here. Colorado's food and beverage ecosystem is richer for them being here.
In America's new and dynamic manufacturing ecosystem.
Bart Taylor is publisher of CompanyWeek. Email him at email@example.com.