U.S. Manufacturing: Exports and the Middle Class

Posted: 1st August 2013 by brednane1981 in Super Tool

types of transport of transporting are loads.Since the founding of our country, hard work and innovation has been a cornerstone of the United States labor force. For over 200 years, U.S. manufacturing has been a global leader in technological innovation. As stated in an ABC News article, “Through much of the 20th century…The country rose to its place as a global economic superpower as customers clamored for the latest American-made products.” From iron plows, cars, and refrigerators, to railways and airplanes, America has made its mark in the world as a country that can lead the way to newer and better products. From the industrial revolution to the postwar boom in the 1940s and ‘50s, American exports have been in high demand all over the world and have flooded out of U.S. industrial plants and into foreign homes. Middle class America lived (literally) off of manufacturing and assembly plants. The U.S. economy was an industrial machine that built American products, pumped money into American homes, and manufactured the American middle class.

As is normal with a growing economy, there comes a turning point on the timeline when the job market shifts from being dominated by durable goods manufacturing to a service driven economy, reducing manufacturing exports. America is no exception to this trend. But it is important to remember that a strong manufacturing sector remains and even though it may not be foremost sector for jobs, it is still a major component of a stable economy and a good source of income. According to the National Association of Manufactures (NAM), manufacturing in 2012 accounted for $1.87 trillion, about 11.9 percent, of GDP.

With the rise of the American service industry, manufacturing has lost some the light that used to shine on it. However, in recent times, American manufacturing seems to be regaining some of the attention that it used to have, and rightly so. Manufacturing has provided a stable backbone on which the economy can rely to hold things together when times get tough. Currently, U.S. manufacturing is responsible for about 12 million jobs, about 9 percent of the current labor force (NAM). For over 110 years the U.S. was the world’s leader in manufactured good, and even though today that post is held by China, the U.S. still ranks number 2 (about 18% of the world total manufactured goods). Adding in the fact that China is seeing rising labor costs and the slow trickle of reshoring projects, manufacturing growth seems to be on the rise.

Rising exports can help to turn the import/export trade ratio around and even it out. Demand is still high for goods with that little “Made in America” stamp because people know that America can make high quality products. Reported by NAM, manufactures in the U.S. are the most productive in the world. So even though the boom of the industrial revolution is long over and manufacturing’s dominating presence in the U.S. economy is dwindling, it is still a major player in creating a strong middle class for the economy to grow.

Chadd Brown
Super Tool, Inc.

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  1. Chadd Brown says:

    Just thought that I would add the article below from CNBC. The article and the graph at the bottom of the blog seem to go hand-in-hand nicely. Thanks for reading and please leave us your thoughts!

    http://www.cnbc.com/id/100941780