Manufacturing starts to rally

September 2, 2012
   
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Manufacturing, led by durable goods manufacturing, which produces things like cars and appliances, is enjoying a healthy revival in Ohio. Manufacturing had been falling steadily in Ohio throughout the 2000s and more sharply after the beginning of the 2007 recession – it reached a low in November 2009 when it fell to 609,900 jobs. But the sector has since added 53,600 jobs, a solid 8.8 percent growth over 33 months, led by durable goods, which added 47,600 of those positions, an 11.9 percent growth in this subsector. Compare this to a growth rate in Ohio jobs more generally over this period of just 3.6 percent. By July 2012, the unrevised numbers had overall manufacturing employment at 663,500 and durable goods at 448,900 in Ohio (monthly numbers are often revised but the revised June numbers are similar). This isn’t close to where we once were – in April 1990 more than one million Ohioans worked in the industry and today more than one out of three of those jobs is gone. Nonetheless, manufacturing remains crucial to the Ohio economy – we rank third in the country for manufacturing jobs, behind only Texas and California, much larger states. Continued growth at this pace would go a long way to leading Ohio into a more meaningful recovery. The American Recovery and Reinvestment Act included rebates for energy-efficient appliance purchases. The automobile rescue package was also designed to revitalize this subsector. The growth in this sector suggests that these policies were helpful.

Table 1 provides basic labor force statistics by demographic group for Ohio in 2011, some of which are explained in greater depth in figures below this table. Men make up a larger share of the labor force and are much more likely to be in the labor force, but in this weak economy are more likely to be unemployed than women. Unemployment is extremely high for African Americans, those without a high school degree, and young adults. Further, these high levels of unemployment don’t reflect that labor force participation is low among these groups – meaning that more people in these demographic categories may have become discouraged and stopped seeking employment. If all those who wanted jobs were actually in the labor force, unemployment rates would be much higher. This table also shows the share of the unemployed that has been unemployed for more than half a year – for older workers, more than half of those who are out of work have been jobless for at least 26 weeks, raising concerns about whether re-employment is possible.

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