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What is Manufacturing?
Manufacturing – Mechanical, physical, or chemical transformation of materials, substances or components into new products.
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Importance of Manufacturing
• U. S. is the world’s largest manufacturing country, producing approximately 21 % of the world’s manufactured goods. Source: United Nations, 2009.
• Manufacturing comprises 11.7 % of GDP. Source: US Bureau of Economic Analysis.
• Manufacturing comprises 9.0 % of total U.S. employment, directly
employing 10.9 million workers. Source: US Census Bureau
• 70 % of all business Research & Development in the U.S. is done by
manufacturing companies. Source: National Science Foundation
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Types of Manufacturing
• 15% Transportation Equipment – Automobile manufacturers – Aircraft manufacturers
• 7% Machinery – Construction Machinery – Farm Machinery
• 13% Food Products – Grain Milling – Meat, poultry and seafood production
• 14% Petroleum and Coal Products – Petroleum Refineries – Asphalt Plants
.
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Types of Manufactured Goods
• Durable Goods – Hard Goods: Goods that generally last 3 years or longer.
– Examples: Automobiles, jewelry, tractors
• Non-Durable Goods – Soft Goods or consumables: Goods that are used immediately or consumed in less than 3 years.
– Examples: Gasoline, food, beverages.
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Value of Shipments of Manufacturing Industries: January 1996 - August 2012
Source: U.S. Census Bureau, Manufacturers’ Shipments, Inventories, and Orders Survey, 1996-2012
$0
$100
$200
$300
$400
$500
$600
1996 1999 2002 2005 2008 2011
Billions of Dollars, Seasonally Adjusted
$287.0 Billion
$476.9 Billion Total
Manufacturing
Recession
Durable
Goods
Industries
Nondurable
Goods Industries
$156.9 Billion $222.4 Billion
$130.2 Billion
$254.5 Billion
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Shipments and New Orders of Durable Goods: January 1996 - July 2012
Source: U.S. Census Bureau, Manufacturers’ Shipments, Inventories, and Orders Survey, 1996-2012
$0
$50
$100
$150
$200
$250
$300
1996 1999 2002 2005 2008 2011
$230.7 Billion
Billions of Dollars, Seasonally Adjusted
$156.9 Billion
$155.9 Billion
$230.5 Billion Shipments
New Orders
Recession
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Historical Percentage of Shipments of
Select Durable Goods: July 2012
Source: U.S. Census Bureau, Manufacturers’ Shipments, Inventories, and Orders Survey, 1996-2012. July 2012 Historic Timeseries NAICS, July 1958 and July 1975 Historic Timeseries SIC.
2.4%
2.8%
0.5%
3.4%
16.5%
6.3%
8.8%
4.5%
6.1%
4.2%
3.0%
1.2%
Construction Machinery
Electromedical, Measuring, andControl Instruments
Computers
Medical Equipment
1958 1975 2012
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Shipments and New Orders of Transportation Equipment:
January 1996 – July 2012
Source: U.S. Census Bureau, Manufacturers’ Shipments, Inventories, and Orders Survey, 1996-2012
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
$100
1996 1999 2002 2005 2008 2011
$69.8 Billion
Billions of Dollars, Seasonally Adjusted
$40.4 Billion
$43.9 Billion
$80.6 Billion
Shipments
New Orders
Recession
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Shipments and Exports, U.S. Manufacturing:
2000 – 2011
Source: U.S. Census Bureau, Manufacturers’ Shipments, Inventories, and Orders Survey, 1996-2011 U.S. Census Bureau, Foreign Trade Division, U.S. Trade 2000 – 2011.
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Billions of Dollars, Not Seasonally Adjusted
$4208.6
Billion
$5491.4
Billion Total Manufacturing
Recession
Manufactured
Exports
$707.2
Billion
$1276.3
Billion
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Sales, Shipments, and Exports of Motor Vehicle and Parts:
January 1996 - July 2012
Source: U.S. Census Bureau, Manufacturers’ Shipments, Inventories, and Orders Survey, 1996-2012 U.S. Census Bureau, Monthly Retail Trade Survey, 1996 -2012 *U.S. Census Bureau, Foreign Trade Division, U.S. Trade 2000 – 2012. Export data not seasonally adjusted.
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
$100
1996 1999 2002 2005 2008 2011
$49.6 Billion
Billions of Dollars, Seasonally Adjusted
$30.9 Billion
$44.9 Billion $75.5 Billion
Shipments
Retail Sales
Recession
Exports* $9.1 Billion
$4.9 Billion
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Source: U.S. Census Bureau, County Business Patterns, 2010 13
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Source: U.S. Census Bureau, County Business Patterns, 2010 14
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Examples of Machinery
– Construction equipment: Bulldozers, Backhoes, Road Graders
– Industrial Machinery: Used to produce products such as, textiles, semiconductors, plastics, rubber and food processing.
– Material Handing equipment: Elevators, Moving stairways, Conveyors, Stacker Machinery
– Farm Machinery: Tractors, Combines, Plows
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Shipments and New Orders of Machinery:
January 1996 – July 2012
Source: U.S. Census Bureau, Manufacturers’ Shipments, Inventories, and Orders Survey, 1996-2012
$0
$5
$10
$15
$20
$25
$30
$35
$40
1996 1999 2002 2005 2008 2011
$33.0 Billion
Billions of Dollars, Seasonally Adjusted
$20.9 Billion
Shipments
Recession
New Orders
$21.2 Billion
$30.2 Billion
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Shipments and Exports of Machinery:
January 1996 – July 2012
Source: U.S. Census Bureau, Manufacturers’ Shipments, Inventories, and Orders Survey, 1996-2012 U.S. Census Bureau, Monthly Retail Trade Survey, 1996 -2012 *U.S. Census Bureau, Foreign Trade Division, U.S. Trade 2000 – 2012. Export data not seasonally adjusted.
$0
$5
$10
$15
$20
$25
$30
$35
$40
1996 1999 2002 2005 2008 2011
$33.0 Billion
Billions of Dollars, Seasonally Adjusted
$20.9 Billion
Shipments
Recession
Exports*
$6.6 Billion
$13.6 Billion
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Comparison of Shipments and Exports of Construction
Machinery to Shipments of Industrial Machinery:
January 1996 – July 2012
Source: U.S. Census Bureau, Manufacturers’ Shipments, Inventories, and Orders Survey, 1996-2012 U.S. Census Bureau, Monthly Retail Trade Survey, 1996 -2012 *U.S. Census Bureau, Foreign Trade Division, U.S. Trade 2000 – 2012. Export data not seasonally adjusted.
$0
$1
$2
$3
$4
$5
$6
1996 1999 2002 2005 2008 2011
$3.4 Billion
Billions of Dollars, Seasonally Adjusted
$3.2 Billion
$1.6 Billion
$5.5 Billion
Industrial
Machinery
Construction
Machinery
Recession
$2.2 Billion
$0.7 Billion Construction
Machinery Export*
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Why are Primary Metals
Important to the Economy?
Source: U.S. Census Bureau, Manufacturers’ Shipments, Inventories, and Orders Survey, 1996-2012
• Base manufacturing industry
• Feeds into other sectors of the economy, from the manufacturing of automobiles to fabricated structural steel for construction projects like bridges or new office buildings.
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Shipments of Primary Metals and Transportation
Equipment: January 1996 – July 2012
Source: U.S. Census Bureau, Manufacturers’ Shipments, Inventories, and Orders Survey, 1996-2012
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
1996 1999 2002 2005 2008 2011
$28.3 Billion
Billions of Dollars, Seasonally Adjusted
$12.7 Billion
$40.4 Billion
$69.8 Billion
Primary
Metals
Transportation
Equipment
Recession
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Shipments of Food products, Petroleum and Coal Products,
and Chemical Products: January 1996 – July 2012
Source: U.S. Census Bureau, Manufacturers’ Shipments, Inventories, and Orders Survey, 1996-2012
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
$100
1996 1999 2002 2005 2008 2011
$60.7 Billion
Billions of Dollars, Seasonally Adjusted
$33.3 Billion
$13.3 Billion
$68.6 Billion
Food
Products
Petroleum and
coal products
Recession
Chemical
Products
$30.8 Billion
$62.1 Billion
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Shipments of Chemical Products and Pharmaceuticals
and Medicines: January 1996 – July 2012
Source: U.S. Census Bureau, Manufacturers’ Shipments, Inventories, and Orders Survey, 1996-2012
$0
$10
$20
$30
$40
$50
$60
$70
$80
1996 1999 2002 2005 2008 2011
$62.1 Billion
Billions of Dollars, Seasonally Adjusted
$30.8 Billion
$6.8 Billion $14.3 Billion
Chemical
Products
Pharmaceutical
and Medicines
Recession
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Capacity Utilization Rates of U.S. Manufacturing:
2008-2012
50
55
60
65
70
75
80
2008 2009 2010 2011 2012
FU
LL
CA
PA
CIT
Y U
TIL
IZA
TIO
N R
AT
ES
(P
erc
en
t)
QUARTER
Q1
Q2
Q3
Q4
Note: These data are not adjusted for seasonal variation, holidays, or trading-day differences. Source: U.S. Census Bureau, Quarterly Survey of Plant Capacity Utilization, 2008-2011 23
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Manufacturing companies account for majority
of US R&D performance
24
Since 2004, Manufacturing companies have accounted for about 70% of total domestic
R&D performance annually.
Source: National Science Foundation and U.S. Census Bureau, Survey of Industrial Research and Development 2004 – 2007; Business R&D and Innovation Survey 2008 - 2009
0
50
100
150
200
250
300
2005 2006 2007 2008 2009
Billions US dollars
Manufacturing
Non-Manufacturing
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Total Capital Expenditures for Selected U.S. Industry Sectors: 1996 to
2010
0
50
100
150
200
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Bill
ion
s o
f D
olla
rs
Recession
Mining
Manufacturing
Information
Finance
Note: Prior to 1998 data for the Information sector was included in Manufacturing Source: U.S. Census Bureau, Annual Capital Expenditures Survey 25
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Percentage of U.S. Manufacturing Total Capital Expenditures for Selected
Subsectors: 1996 to 2010
Note: Prior to 1998 data for semiconductors was included in communications
equipment and electronic components and equipment manufacturing.
Source: U.S. Census Bureau, Annual Capital Expenditures Survey
0
2
4
6
8
10
12
14
16
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Pe
rce
nt Recession
Motor Vehicles
Semiconductors
Petroleum
Food
26
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*SIC Classification Basis 1996-2000 NAICS Classification Basis 2001 – Present Source: U.S. Census Bureau, Quarterly Financial Report, 1996 – 2011
(100)
(75)
(50)
(25)
0
25
50
75
100
125
150
175
200
1996 1999 2002 2005 2008 2011
U.S. Manufacturers - Net Income After Tax Billions of Dollars, Not Seasonally Adjusted*
Recession
TotalManufacturing
NondurableManufacturing
DurableManufacturing
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*SIC Classification Basis 1996-2000 NAICS Classification Basis 2001 – Present
Source: U.S. Census Bureau, Quarterly Financial Report, 1996 – 2011
(30)
(20)
(10)
0
10
20
30
40
50
1996 1999 2002 2005 2008 2011
U.S. Nondurable Manufacturers - Net Income After Tax Billions of Dollars, Not Seasonally Adjusted*
Recession
Beverage andTobaccoProducts(Included inFood until 4thQuarter 2000)
Petroleum andCoal Products
Chemicals
28
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*SIC Classification Basis 1996-2000 NAICS Classification Basis 2001 – Present Source: U.S. Census Bureau, Quarterly Financial Report, 1996 – 2011
(50)
(40)
(30)
(20)
(10)
0
10
20
30
40
50
1996 1999 2002 2005 2008 2011
U.S. Durable Manufacturers - Net Income After Tax Billions of Dollars, Not Seasonally Adjusted*
Recession
Machinery
Computer andElectronicProducts(Included inMachinery until4th Quarter 2000)
TransportationEquipment
29