Voices: Robert Hooper | Manufacturing is key for the US and Nevada

October is National Manufacturing Month in the United States, which highlights the value of manufacturing to the U.S. economy including available, highly-skilled careers. The first Friday of October was National Manufacturing Day, a celebration of modern manufacturing with the hope of inspiring the next generation manufacturers. It was also a celebration in Nevada of the Western Manufacturing Alliance (WMA) launch. This new alliance seeks to help manufacturers throughout the Western U.S. to be successful through next generation manufacturing (NGM) best practices.

Manufacturing is not only a key sector of the U.S. economy, it is a vital one. In 2015, manufacturing contributed $2.17 trillion, accounting for 12.1 percent of gross domestic product (GDP). For each $1 spent on manufacturing, another $1.81 is added to the economy, making it the highest multiplier effect of any economic sector. By itself, U.S. manufacturing would be the ninth-largest economy in the world.

Currently, there are approximately 12.3 million manufacturing workers employed in the US, or about 9 percent of the total workforce. Manufacturing is an important provider of jobs that offer good wages for workers without college degrees. In 2014, the average U.S. manufacturing worker earned $79,553 annually, including pay and benefits. Also, U.S. manufacturers perform over three-quarters of all private sector research and development nationwide, driving more innovation than any other economic sector.

The manufacturing footprint extends beyond the sector. It has a significant “indirect employment multiplier” due to the purchase of domestic goods and services by manufacturers which provides jobs outside of manufacturing. For each worker directly employed in manufacturing, the sector’s output supports over 1.4 jobs elsewhere in the economy, making a substantial contribution to GDP annually. However, GDP data does not completely cover manufacturing’s impact, as there is no accounting for how manufactured goods generate significant demands from other sectors of the economy. These range from energy and natural resources to construction of new factories to services provided by accounting, engineering, software, and temporary employment firms.

Manufacturing is a key industry for Nevada, as it is for the U.S. It continues to grow in both size and importance, with about 56,000 Nevadans employed statewide by over 1,800 manufacturing companies. Printing, publishing and fabrication account for more than 10,000 jobs alone. The industry’s growth is strong, accounting for 3.3 percent of total new jobs in the state. Almost half of the state’s manufacturing jobs are in northern Nevada, with Carson City remaining the state’s largest manufacturing city, per capita.

The sector produces a wide variety of products and serves numerous markets globally. The diversity of its products, include and are not limited to: electronics, furniture and fixtures, chemicals, industrial machinery and equipment, paper products, lumber and wood, textiles and apparel, rubber and plastics, transportation equipment, pharmaceuticals, food processing and nutraceuticals, aerospace, medical devices. ... and much more.

During the next decade, the manufacturing sector projects that close to 3.5 million new manufacturing jobs will be needed, and 2 million of those are expected to go unfilled due to a skills gap. Nationwide, 80 percent of manufacturers have reported a moderate or serious shortage of qualified applicants for skilled and highly-skilled production positions.

The availability of a skilled workforce is a top concern of Nevada manufacturers statewide. Leveraging the workforce education initiatives passed by the Nevada Legislature in 2015, there is ongoing collaboration between the K-12 school districts and the community colleges to train the Nevada workforce with a focus on employer needs, including manufacturing.

In the Sierra Region, the Career and Technical Education Programs of both the K-12 School Districts and Western Nevada College are collaborating with local manufacturers to offer programs and certifications that meet immediate and future workforce requirements. This plus the support by the WMA will enable the profitable growth of this key economic sector.