We live in an on-demand economy. If we want something, and can generally afford it, it can probably be purchased and used very quickly. Three functional parts of the economy need to work together to make our everyday purchases possible. First, the primary industries of mining, farming, and raw material extraction and refinement need to take place. The second function is manufacturing, in essence, taking the raw materials and processing them into something useful for consumers and other business processes. Finally, tertiary industries move the raw materials and finished goods to market and account for the sales, marketing and management of it all.
In recent history, because of internet technologies and great supply chain innovations, there has been an enormous focus on supply chain innovation and new ways to sell and deliver products. Perhaps overshadowed are great innovations in the primary industries (shale fracking technologies and agri-bioscience come to mind). Oh – and then there is manufacturing. We take for granted the constant and profound innovations that come from making both complex and everyday items better and less expensive.
There are nearly 1,800 manufacturing companies in the 11-county Columbus Region, and over 80,000 people are directly employed by this sector of the economy. This sector experienced a 43% increase in productivity (output per worker) in the first decade of this century. Names like Honda, Anchor Hocking, DuPont, Rolls Royce, Worthington Industries, and Abbott Nutrition are among some of the brands that make products that are delivered around the world from Central Ohio. However, hundreds of companies quietly make the components and machinery within the supply chains of the automotive, aerospace, food and consumer products industries.
According to the National Association of Manufacturers;
- The United States is the world’s largest manufacturing economy, producing 21 percent of global manufactured products. China is second at 15 percent and Japan is third at 12 percent.
- U.S. manufacturing produces $1.7 trillion of value each year, or 11.7 percent of U.S. GDP. For every $1.00 spent in manufacturing, another $1.35 is added to the economy.
- Manufacturing supports an estimated 17 million jobs in the U.S.—about one in six private-sector jobs. Nearly 12 million Americans (or 9 percent of the workforce) are employed directly in manufacturing.
- In 2010, the average U.S. manufacturing worker earned $77,186 annually, including pay and benefits. The average non-manufacturing worker earned $56,436 annually.
- U.S. manufacturers are the most productive workers in the world—far surpassing the worker productivity of any other major manufacturing economy, leading to higher wages and living standards.
- U.S. manufacturers perform two-thirds of all R&D in the nation, driving more innovation than any other sector.
- Taken alone, U.S. Manufacturing would be the 9th largest economy in the world.
This week the 2020 Board of Directors meets to discuss the initiative’s progress and get an update on the regional economy. Our team is returning from the International Plastics Showcase held in Orlando, where we met with regional, national and international companies about doing business – or more business within Central Ohio.