Manufacturing Begins to Recover


by Debra Bultnick

In 1959, manufacturing represented 28 percent of U.S. economic output. By 2008, it represented only 11.5 percent. The results of the Manufacturers Alliance/MAPI Survey on the business outlook suggest that the U.S. manufacturing sector is beginning to recover from the recent economic downtown—especially compared to the sizeable reduction recorded in March 2009.

 

Here in Minnesota, agriculture equipment manufacturer AGCO is investing $50 million in Jackson to produce Massey-Ferguson and Challenger tractors. Currently, these products are imported from their overseas plants for the North American market. The new plant’s full capacity could reach 10,000-12,000 tractors annually in three to five years.

 

Still, some bad news came when Ford Motor Company confirmed that it still intends to close the Ford Ranger plant in St. Paul. The remaining 740 good-paying, middle class jobs (down from almost 1,900 in 2006) will be lost.

 

But that’s not the only story on the newswire. General Electric announced in January that it plans to sign five agreements with Chinese partners, totaling more than $2 billion in revenue for GE. This will generate more than $1 billion in U.S. exports in clean energy, aviation, and rail transportation. It will also create or support jobs in both countries, including more than 4,500 jobs in the United States.

 

Import, Export

President Obama has set a target of doubling U.S. exports by 2015 to bolster the struggling economy. And thanks to slowing imports (particularly oil) and solid demand for U.S. goods, the trade deficit has actually trended downward since June 2010. Over the first 11 months of 2010, the country has been on track to meet the president’s goal with exports rising almost 17 percent from the same period in 2009. By November 2010, exports were only four percent below the record level in July 2008.

 

In January, the United States and China also agreed to export deals worth $45 billion. According to a Washington official, these deals will support 235,000 U.S. manufacturing jobs and be worth $25 billion spread over 70 contracts and 12 states.

 

What This Means for the Unemployed

Trade deficits and exports don’t tell the whole story. Many workers displaced during the Great Recession don’t have the new skill set needed for current openings. Their old job has been upgraded, and employers are not willing to settle for less. By the end of August 2010, Manufacturers advertised nearly 200,000 jobs. That's an almost 40 percent jump from a year ago, according to government data. Despite that, hiring by manufacturers has risen less than six percent over the same time period, evidence that they are having a hard time finding qualified workers.

 

What’s an unemployed machinist, technician, or design engineer to do? Start by visiting a local technical college to learn how to upgrade your skills. Learn more about manufacturing careers in Minnesota. There are also programs to help workers who were part of a large layoff or who lost their job to foreign competition and imports. Do your homework, determine which facts are relevant to your situation, and know your rights.

 

Debra Bultnick is the Industry Liaison for the Minnesota Department of Employment and Economic Development working to achieve the best results in workforce development for all disciplines of the manufacturing industry across Minnesota. She gathers and shares information with manufacturers, educators/trainers, and the state for the benefit of the workforce, the economy, and Minnesota's manufacturing base.

 

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