Amid economic turmoil, the United States manufacturing industry fared well this year, as shown by its growth and stability.
US factories generated around 467,000 new positions during the past 12 months. Additionally, according to the Federal Reserve, manufacturing production in September reached its highest level in 14 years. The achievement occurred in the middle of the nation’s economic crisis, marked by high-interest rates, increases in the price of oil, and investors’ poor trust in the market. However, the industrial industry kept making automobiles, candy bars, and computers to meet customer demand.
Experts on Wall Street and economists have previously predicted that there would be a global recession. The industrial sector, however, is hardly deterred from development and progress by the current circumstances. Although CEOs are optimistic they can grow production despite rising demand, the industry faces labor shortages and supply interruption challenges.
A see-saw year for manufacturing
Sales of vehicles for manufacture exhibited a back-and-forth trend. And the lack of semiconductors is primarily to blame. But despite these obstacles, there was a 1% increase in output in September, suggesting the industry could exceed forecasts.
“Since we bought them, we’ve grown the company from 33 employees to 53. We’ve invested in new technology, robotic press brakes, and new bathrooms for the employees. It’s an aggressive push to reinvest back into the factory because we’re so enthusiastic and optimistic about the future,” said Drew Greenblatt, a manufacturing company, following its purchase of the Madsen Steel Wire Products factory.
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Shortage of semiconductors
The manufacturing industry continues to struggle with the interruption of the semiconductor supply. For instance, corporations had difficulty locating sufficient supplies of semiconductors during the pandemic, even though semiconductors are required for the production of autos. The condition has, however, considerably improved now that the pandemic has concluded. However, firm administrators believe the situation is still far from average.
“I try to keep enough parts on the shelf. But if I have two on the shelf and I sell two, I can’t sell another one till I get a new one back. And with four or five months’ lead time, I can’t anticipate that far in advance what I’m going to need,” says Betty Jane Parrott, CEO of a family-owned business.
“A lot of the baby boomers retired during COVID, and they were the ones that had years and years of experience. We’ve been looking for qualified welders for probably a year. The skilled people, the trained people, are very, very hard to find,” she added.
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To bounce back
Unexpectedly, factories employed additional people. With an average of 20,000 people hired each month, it is close to the employment levels before the pandemic. In addition, manufacturing companies got 27,000 new hires, making 22,000 more in September.
“Manufacturing is roaring back, the strongest manufacturing job recovery since the 1950s,” said President Joe Biden.
“Every president wants to increase manufacturing. But the future of jobs is in the service sector,” Betsey Stevenson from the University of Michigan said.
“We’ve become so much more productive at making things, and we just only need to spend a small share of our resources — our people, our time, our factories, our equipment — making stuff,” he added.
“We’re just seeing the demand. We want to have the best technology for our people to make it through potentially stormy times,” Greenblatt concluded.
Photo Credit: Charles Mostoller
Source: NPR
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