The United States manufacturing industry has experienced strong growth over the past year. As we discussed in a previous blog post, the industry has experienced positive growth for the fifth consecutive month in July, signaling a healthy manufacturing market.
Even with this positive growth, however, the U.S. manufacturing industry continues to lag behind China. According to the the 2016 Global Manufacturing Competitiveness Index released by Deloitte and the Council on Competitiveness, China ranks as the world’s leading manufacturing economy. The U.S., on the other hand, is ranked second. But that may soon change, as market experts predict the U.S. manufacturing economy will surpass its Chinese counterpart in the near future.
The same 2016 Global Manufacturing Competitiveness Index cited above indicates that the U.S. manufacturing economy will surpass China’s manufacturing economy by 2020, at which point the U.S. will boast the world’s most competitive manufacturing economy.
This begs the question, however: what’s been taking the U.S. manufacturing economy so long to increase its standings on the global manufacturing marketplace? Well, the U.S. manufacturing industry isn’t exactly struggling. As indicated by previous Manufacturing Indexes, it’s steadily growing month after month. However, China has a particularly strong manufacturing industry, due largely in part to its influx of new employment during the 1990s. China experienced a peak during the 1990s, in which it creates hundreds of thousands of new manufacturing jobs. Since then, however, employment in China’s manufacturing industry has been on the decline.
“The results of the 2016 study clearly show the ongoing influence manufacturing has on driving global economies. From its influence on infrastructure development, job creation, and contribution to gross domestic product (GDP) on both an overall and per capita basis, a strong manufacturing sector creates a clear path toward economic prosperity,” wrote the report’s authors.
Of course, there’s really no way to predict the future of the U.S. manufacturing industry — or any country’s manufacturing industry — with 100% accuracy. These reports certainly help by forecasting likely scenarios, but the bottom line is that unforeseen circumstances are bound to happen. And these circumstances may affect different countries’ manufacturing industries. In any case, it’s safe to say that the U.S. manufacturing industry is still growing and growing strong. July marked the fifth consecutive month in which the industry experienced positive growth, signaling a turnaround for the previously crippled industry. Whether or not this trend continues, however, is yet to be seen.