December Industry Report Out – Manufacturing
Jennifer Nietz - Director of Operations
Manufacturing is an industry that we live and breathe here at COACT. I would say about 90% of clients have prospects in some market segment within manufacturing. It’s a part of who we are here and we work very closely to evaluate the trends in the industry. In a recent article published by IBISWorld, they speak about the manufacturing headlines, and the message is about the decline and demise in the industry. They are stating the industries’ market share of the US economy has fallen from 10.7% to 8.1% however, that is all relative because the service economy has expanded at a faster pace. In reality, many manufacturing industries have continued to expand, and the United States remains one of the largest manufacturers in the world.
The below graph illustrates the current market share of the manufacturing industry by the subcategories within it.
According to IBISWorld, chemical manufacturing is the largest, and one of the most successful, components of manufacturing in the United States; the subsector accounts for about 16.0% of total manufacturing value added in 2015. Chemical manufacturers produce a wide range of primary, intermediate and end products, including everything from plastics and resin to vitamins and explosives. The chemical manufacturing subsector has received its largest boost from the Petrochemical Manufacturing industry, whose value added has grown at an annualized rate of 10.5% between 2010 and 2015 to account for 11.5% of the subsector’s overall IVA.
Another area of success is machinery manufacturing. The machinery manufacturing subsector includes a range of industries that produce capital equipment necessary in construction, semiconductor production, agriculture, food processing, printing, and oil and gas, among others. In the 10 years to 2015, IBISWorld expects the subsector’s industry value-added to grow at an annualized rate of 1.7%.
The last subcategory I would like to highlight is fabricated metal product manufacturing, which is generating the third-fastest value-added growth in manufacturing. Fabricated metal product manufacturers primarily transform metal into intermediate or end products through processes such as forging, stamping, bending, forming and machining. In 2015, the subsector is expected to be the sixth-largest manufacturer in the economy!
We are looking forward to our continued work in the manufacturing sectors with all of our clients. If you have further questions please feel free to reach out for more detailed information on the manufacturing subcategories.
Questions or comments? Please contact Jennifer Nietz at jnietz@teamCOACT.com.