Manufacturing Picks Up in the Midwest

As the US economy slowly recovers from recession, reports indicating that the manufacturing industry is starting to make a comeback have become a hot topic. While some people are still skeptical, recent reports show that the Midwest is seeing an increase in the availability of manufacturing jobs. Could this be a sign that US manufacturing will make a full recovery?

According to the Business Journal, hiring activity in the manufacturing industry is picking up throughout the Midwest, and domestic manufacturing professionals are beginning to develop an optimistic outlook on the state of the economy. A survey conducted by tax and consulting firm McGladrey Wisconsin indicated that 77 percent of the industry executives interviewed were optimistic about their companies expanding over the next year, and 71 percent intended to create new manufacturing jobs.

Increases in production are trending throughout the Midwest, and, despite recent headlines about Detroit's bankruptcy, the Bureau of Labor Statistics' regional and state employment numbers show that Michigan added approximately 7,600 new manufacturing positions in July—more than any other state in the Midwest. Experts also believe that the US auto industry is finally bouncing back, which will have a huge impact on Detroit's economy.

In Ohio, energy production is growing, along with the demand for steel and additional building materials. According to CNN, 2,400 new jobs were added to Ohio's manufacturing industry, and the state is steadily seeing employment and production figures climb. For Ohioans, this is great news, because the manufacturing industry is the state's top sector and is likely to be the driving force behind its recovery.

If you're one of the millions of Americans who lost their manufacturing jobs because of the recession, the fact that the industry is picking up in the Midwest is a great sign. According to the Boston Consulting Group, this trend is predicted to spread throughout the country. Numerous factors have affected these changes in the manufacturing industry, including rising costs of labor and energy in China and stable wages and lower energy costs in the US. While wages in China are still far below those in the US, they did increase by approximately 150 percent between 1999 and 2006, which meant that China's wage growth outpaced its production growth. When this increase in wages is combined with recent rising costs for shipping products from China and the fact that industrial land in the US is cheaper than it is in China's port cities, production within the US becomes a more feasible option.

The American manufacturing industry has been struggling for over a decade. However, its growth throughout the Midwest, the fact that large American companies have started reshoring manufacturing work, and an increase in US exports all indicate that the American manufacturing industry could well be poised to make a comeback.

(Photo courtesy of john kasawa / freedigitalphotos.net)