Yakima County Development Association - Manufacturing Jobs: Impacts Bigger Than Ever Before

Jean Brown

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Jean Brown

Jean publishes a blog called the Enterprise Corner.  It features articles on entrepreneurship, local industry trends, manufacturing news and periodic ‘toolbox’ articles showcasing assistance, incentives and other resources for local businesses.

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Manufacturing Jobs:  Impacts Bigger Than Ever Before

Manufacturing Jobs: Impacts Bigger Than Ever Before

December 09, 2013

New evidence strongly suggests that manufacturing is way more important to our local economy than ever before.  In the article, The Multiplier Effect: There Are More Manufacturing Related Jobs Than You Think," authors Keith D. Nosbusch and John A. Bernaden point out that manufacturing's true impact is understated.  As manufactured products and processes become more complex, they support significant skilled jobs in logistics and transportation, customer service, technical support, regulatory and safety disciplines, and a host of other areas.

alt text"As factories get 'smarter' and more advanced," Nosbusch and Bernaden wrote, "the multiplier increases significantly. In some advanced manufacturing sectors, such as electronic computer manufacturing, the multiplier effect can be as high as 16 to one, or 16x, meaning that every manufacturing job supports 15 other jobs."  Old manufacturing multipliers ranging from 2 to 4 are now giving way to higher numbers as a result of the increasing added value that results from this sector.

Here locally we readily see the impact of our manufacturing sector.  Food processors, aerospace companies, metal fabricators, plastics companies, and machinery makers create enormous value for the Yakima Valley economy.  The region's manufacturing sector employs over 8,000 and generates over $300 million in annual wages.  The average manufacturing employee in Yakima County makes nearly $41,000 per year.  With excellent wages it is no wonder that the sector employs 7.6 percent of our workforce but generates 9.3 percent of our region's total wages.  On top of these good incomes, our manufacturers obviously support lots of jobs in other local sectors.
 
Manufacturing's impacts are growing nationally and the sector has rebounded substantially from a few years ago.   US Manufacturers have added over 500,000 jobs over the past two years and this is not just a short term bump out of the recession.  According to a report from the Boston Consulting Group, it is estimated that increased exports and production work “re-shored” from China could create up to 5 million U.S. manufacturing jobs.  The consulting group adds that cheaper energy in the form of natural gas and cheaper labor costs are reducing manufacturing costs and creating new competitive advantages.  In the years ahead, manufacturing costs in the United States will be 8 percent to 18 percent cheaper than other developed countries.  “The United States is steadily becoming one of the lowest-cost countries for manufacturing in the developed world,” the report said.

While these are all welcome trends the future of manufacturing will not take care of itself.  According to Jerry Jasinowski, former president of the National Association of Manufacturers, "We need sensible policies for attracting capital investment, training a new generation of manufacturing workers and encouraging exports to make it happen. Growth and job creation should be our primary objectives.  A growing economy will enable us to overcome any number of our more vexing challenges, and manufacturing is the key."  Right on point Jerry... and a blueprint for our actions here in Yakima County. 


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"A lot of the leaders here in Yakima are very probusiness and make it easy to do business in Yakima." - Lisa Shields-Long, Co-President, Shields Bag & Printing