US manufacturing turnaround largely a myth, says new think tank report

The
effect of the United States’ “manufacturing renaissance” is mostly hype,
according to a new report by a Washington-based think tank.

The
Myth of America’s Manufacturing Renaissance: The Real State of U.S.
Manufacturing
,
published by the Information Technology and
Innovation Foundation
(frequently described in coverage as a nonpartisan organisation) describes
growth as mainly “cyclical rather structural” and thus temporary.

CNBC
reports
that the research tracks overall growth as modest since 2009 (the
end of the Great Recession).

As cautious
commentators on America’s manufacturing growth have pointed out, manufacturing
employment has grown substantially since the recession’s end (by about 520,000
jobs), but shrunk by more than this during the recession (losing 2.5 million
jobs).

Jobs were
returning to the US from overseas, but other jobs were being offshored at
roughly the same rate.

The Foundation claims that there are several myths surrounding the manufacturing
sector in the US, including around productivity growth, the effect of the shale
gas boom, and how much Chinese wages were growing.

On productivity, the ITIF
claims it
“is not increasing faster than that of other industrialized
countries, and is growing much slower than China and South Korea.”

Misconceptions
were based on ‘“Pollyannaish optimism” and “consultant-driven marketing hype”’
notes The Guardian.

To read The
Myth of America’s Manufacturing Renaissance,
click here.

Image: http://morethanshipping.com