The importance of manufacturing jobs

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WASHINGTON – The U.S. Commerce Department’s Economics and Statistics Administration recently released a new report titled “The Earnings of New Hires in Manufacturing,” which confirms that manufacturing jobs created in recent years are indeed good jobs.


U.S. Secretary of Commerce Penny Pritzker mentioned the report’s findings during an Aug. 22 speech on the importance of American manufacturing at Wal-mart’s first-ever U.S. Manufacturing Summit in Orlando, Fla.


The report found that new hires in manufacturing had 38 percent greater monthly earnings than new hires in other sectors at the end of 2011 (the latest data available).


The monthly earnings premium for the manufacturing workforce as a whole, including both new hires and incumbents, was 25 percent. This earnings premium results from both greater hourly earnings and from more hours of work per month.


“Today’s ESA report on manufacturing provides important evidence that new manufacturing jobs are, in general, better paying jobs than positions in other sectors,” said Pritzker. “This report provides further validation that we need to continue our strong efforts to spur American manufacturing, which represents a vital part of our nation’s economic growth.”


The new report, which is based on the U.S. Census Bureau’s extensive Quarterly Workforce Indicators data set, shows the following:


• New hires in manufacturing continue to enjoy higher monthly earnings relative to new hires in non-manufacturing industries. This premium peaked during the recession but has returned to near its pre-recession average;


• At the end of 2011, the ratio of new hire earnings to incumbent earnings was about 8 percentage points higher in manufacturing than in other industries;


• For at least the last decade, the earnings of new hires relative to incumbents have been consistently higher in manufacturing; and


• Since the recession began, real average earnings for new hires in manufacturing grew 3.5 percent. Over the same time period, real earnings for hires in other industries were flat.


The complete report can be found at www.esa.doc.gov/Reports/earnings-new-hires-manufacturing.


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