Those of us in the manufacturing industry have always known that this industry is driven by innovation and creates the opportunity that’s made the American economy the envy of the world.
Those of us in the manufacturing industry have always known that this industry is driven by innovation and creates the opportunity that’s made the American economy the envy of the world.
Manufacturing is a key component of a modern society, enabling people to build the goods and products they need to eat, live, entertain and protect themselves. The business of making things with utility and adding value to raw materials is the essence of manufacturing. In fact, if you look around you, nearly everything is manufactured. Without manufacturing, the modern conveniences we enjoy would not exist.
Some people say, however, that manufacturing doesn’t matter. It isn’t that big of a deal and we “make” everything oversees anyway right? This assumption couldn’t be more wrong. From rockets to airplanes, from diapers to doughnuts, tables to breakfast cereal or medical devices to climbing equipment — all of these things are “Made in Utah.”
Manufacturing is one of Utah’s basic industries and one that creates tremendous value in the economy. It is a creator of new wealth. For every $1 spent in manufacturing, another $1.81 is added to the economy. That is the highest multiplier effect of any economic sector. In addition, for every one worker in manufacturing, there are another four employees hired elsewhere.
Many people think that manufacturing consists only of large companies. However, the vast majority of manufacturing firms in the United States are quite small. In the most recent data, there were 251,857 firms in the manufacturing sector in 2013, with all but 3,702 firms considered to be small (e.g., having fewer than 500 employees). In Utah the vast majority of manufacturing firms have fewer than 100 employees.
Manufacturing jobs pay really, really well. In 2014, the average manufacturing worker in the United States earned $79,553 annually, including pay and benefits. The average worker in all industries earned $64,204. Looking specifically at wages, the average manufacturing worker earned nearly $26 per hour, according to the latest figures, not including benefits. In Utah, manufacturing jobs pay more than 28 percent more than the average wage.
Nationally, manufacturing output has increased 18 percent since the end of the recession in 2009. Last year, manufacturers contributed a record $2 trillion to our economy. Our manufacturing sector alone is larger than the entire economies of all but seven countries and manufacturing exports have reached an all-time high.
Locally, manufacturing accounts for $17.47 billion in economic output and 12.4 percent of the gross state product. Manufacturing is the No. 1 exporter in the state. In fact, manufacturing accounts for 95 percent of the state’s exports. Also, the amount of manufacturing exports has risen from just over $5 billion in 2005 to more than $12.5 billion in 2014. The industry in Utah employs more than 125,000 people with an average wage of $63,500.
So, today, I’m pleased to report to you that manufacturing in America is making a comeback. That’s a tribute to the hard-working men and women who produce the goods and generate the ideas that power the U.S. economy as well as the global economy.
Manufacturing is the lifeblood of the U.S. economy. That’s why the current administrations, both nationally and in our state, regularly talk about the importance of manufacturing and our industry has supporters across the political spectrum.
Today, manufacturing is a lot different than it was in your grandparents’ day, but it still allows more than 12 million men and women to provide a good life for their families.
Over the next decade, nearly 3.5 million manufacturing jobs will likely be needed, and 2 million are expected to go unfilled due to the skills gap.
According to a recent report, 80 percent of manufacturers report a moderate or serious shortage of qualified applicants for skilled and highly skilled production positions.
To address the skills gap, manufacturers not only have to find workers with the skills required to meet today’s and tomorrow’s advanced manufacturing requirements, they must also develop and engage their existing workforces. Seven out of 10 executives reported shortages of workers with adequate technology, computer and technical training skills. The executives see developing their workforces as the most effective way to remedy the problem, with 94 percent agreeing internal employee training and development programs are among the most effective skilled production workforce development strategies, and 72 percent agreeing involvement with local schools and community colleges is effective. This reflects an understanding of the multidimensional nature of the skills gap as manufacturers see the need to develop the talent pipeline both in their companies and communities.
The “Public Perception of Manufacturing” series, conducted over the past six years by the Manufacturing Institute and Deloitte, consistently reveals that while Americans consider manufacturing among one of the most important domestic industries for maintaining a strong national economy, they rank it low as a career choice for themselves. Moreover, only 37 percent of respondents in the 2015 study indicated they would encourage their children to pursue a manufacturing career. Interestingly, however, those with high industry familiarity tend to have more favorable perceptions and they are twice as likely as those with no familiarity to encourage their children to pursue a manufacturing career. Thus, manufacturers need to engage people through community, educational and government programs in order to improve the perception of the U.S. manufacturing industry.
It is apparent that manufacturers have great opportunities to impart their knowledge and love for an industry that produces the public’s quality of life. It is a great chance to encourage an entirely new generation to tackle the challenges facing tomorrow’s manufacturing industry — to innovate, invent and advance an already highly technological industry. The slate is clean and the canvas is yours. Become a part of a fabulous industry advancing at an alarming rate.
Manufacturing produces your quality of life — from your good night’s sleep, to breakfast or the vehicle that carries you safely to your place of employment. Today’s manufacturer makes these modern conveniences possible. I personally want to thank the manufacturing community for what they do. Thank you for your contributions to your local, state and national economies and for producing my “quality of life.” Thank you for being a manufacturer.
Todd R. Bingham is the president and CEO of the 112-year-old Utah Manufacturers Association. He has more 20 years’ experience in the association business and as
a registered lobbyist representing business and industry in the areas of public policy, governmental affairs and economic development. He also serves on the Utah Labor Commission, Occupational Safety and Health Employer Advisory Board, Rocky Mountain Center for Occupational and Environmental Health, Economic Development Task Force, Governor’s Economic Council, Governor's Rural Partnership Board, Division of Workforce Services Employers Advisory Council, Workers Compensation Advisory Board and Utah Employers Council.