DECATUR — Manufacturers in Central Illinois are key to the state’s economy, according to a new economic report.
The Illinois Manufacturers’ Association this week released a study on the economic impact of manufacturing on Illinois conducted by independent economists at the University of South Carolina.Â
The study found that manufacturing in Illinois contributes a total economic input of between $580 billion and $611 billion annually, the largest contributor to the state’s gross domestic product of any industry.
“This new economic study confirms what we have long known — that manufacturing is the key pillar of our state's economy, and its success is vital to our state's success,” said Mark Denzler, the associations president and CEO, during an event Wednesday in Decatur.Â
People are also reading…
Denzler spoke at Richland Community College, the first step of what will be a statewide “manufacturing matters” tour of major manufacturing centers. He pointed to Richland as an example of an institution preparing a higher-skilled workforce for the rapidly-developing industry.Â
Greg Webb talks about focus on Illinois food and agriculture during “Manufacturing Matters.”
“At Richland, we strive daily to deliver the advanced technical and essential skills training that provides the workforce necessary to continue Illinois’ strong manufacturing history and contribute to its future,” Cristobal Valdez, Richland's president, said in a statement released after the event.Â
Manufacturing is especially important for Macon County as it contributes 50% of the county’s annual economy. Â
“Illinois is the epicenter of manufacturing in the United States,” Denzler said. “Decatur and Macon County are the epicenter of manufacturing in Illinois.”Â
According to the report, counties across Central Illinois generate billions of dollars both directly and indirectly from the manufacturing industry, in addition to creating thousands of jobs.
In Macon County, manufacturing generates $13.4 billion in total annual economic output and supports over 22,000 jobs.Â
Manufacturing in McLean County generates $2 billion in total annual economic output and supports over 7,000 jobs.Â
Coles County manufacturers generate $1.1 billion in total annual economic output and support 3,489 jobs.Â
“The state of Illinois is blessed with a strong manufacturing base,” said Greg Webb, chair of the IMA Board of Directors and vice president of state government relations for Archer Daniels Midland Co.
ADM is a leading employer in the region and has its North American headquarters in Decatur.Â
Previous studies have underreported the manufacturing sector’s contributions to Illinois’ economy, according to an economist who conducted the IMA study. Â
“An important takeaway from this study is the sheer size of manufacturing’s economic presence in Illinois,” said Joseph C. Von Nessen, research economist at the Darla Moore School of Business at the University of South Carolina. “Every job created by a manufacturer spurs additional hiring and spending across multiple industries in the state.”Â
This so-called “multiplier effect,” Von Nessen said, is significantly higher for manufacturing than it is for other Illinois industries, meaning economic growth in the manufacturing sector could also lead to significant economic growth in other sectors. Â
“The opportunities within the manufacturing sector are great,” Webb said.Â
Denzler suggested some state level policy changes could expand those opportunities.Â
Continuing to advocate for workforce preparation and recruitment is necessary, he said, in addition to taking actions toward lowering energy costs for manufacturers. Â
“Manufacturers are innovators and entrepreneurs, builders and producers, dreamers and leaders for solving our challenges and envisioning the future,” Denzler said. “It's imperative that our elected officials enact policies to continue to allow the manufacturing sector to grow in Illinois.”
U.S. cities where manufacturing is thriving
U.S. Cities Where Manufacturing Is Thriving
Photo Credit: BigPixel Photo / Shutterstock
The health of the manufacturing sector in the U.S. has been a major focus of public attention in recent years. With populist political figures like Donald Trump on the right and Bernie Sanders on the left offering critiques of U.S. trade policy and debating how best to assist American manufacturers and workers, policymakers and economic leaders of all stripes have put new focus on support for manufacturing. From former President Trump’s focus on trade policy and President Biden’s $1.2 trillion bipartisan infrastructure bill to companies “reshoring” plants and consumers expressing preferences for American-made goods, combatting the apparent decline of U.S. manufacturing has become a shared commitment.
Manufacturing is important to the U.S. economy for several reasons. Manufacturing jobs have historically been a pathway to the middle class, offering good pay without requiring high levels of education. Companies that rely on manufacturing invest heavily in research and development, which helps drive innovation. Domestic manufacturing also contributes to more secure and resilient supply chains—a point that has become clear during the COVID-19 pandemic.
But in recent decades, the role of manufacturing in the U.S. economy has been diminished. Many companies began moving factories abroad in search of lower costs and better profit margins. Trade deals like NAFTA reduced the cost of foreign imports, giving U.S. producers more competitors. Technological advances made manufacturing processes more efficient, which reduced the need for many manufacturing jobs.
The effects of these shifts in manufacturing are most apparent in employment, which has decreased over the years as a share of overall employment and in total numbers. After manufacturing peaked near 40% of U.S. jobs at the height of World War II, the sector has seen a steady decline over time, to around 8.4% of employment today. In total employment, manufacturing jobs peaked at 19.5 million in the late 1970s and fell off sharply after 2000 to just 12.6 million today.
Manufacturing accounts for a much smaller share of the US workforce than in decades past
But despite the decrease in manufacturing employment over the past several decades, manufacturing output as a share of real GDP has stayed relatively stable. Since 1997, manufacturing has fluctuated between 11.5% and 13.2% of GDP, after adjusting for inflation. While manufacturing output as a share of nominal GDP has declined over that span (from 16.2% to 10.9%), the change in the nominal figures reflects both growth in other sectors as well as slower price increases for manufactured goods more so than a decline in manufacturing productivity.
Manufacturing output has remained relatively stable as a share of real GDP
But one important piece of the conversation around manufacturing in the U.S. is where manufacturing is thriving. Many Northern states that were major U.S. manufacturing centers historically, including New York and Pennsylvania, have seen lower rates of growth in employment and output from manufacturing in recent years. Instead, many of the states with the highest recent growth in manufacturing—both for employment and GDP—are found in the southern and western U.S.
Nevada has seen nearly 50% growth in both manufacturing employment and GDP from 2010 to 2020, while California has had a 45.6% increase in GDP and Florida saw a manufacturing GDP increase of 35.5%. At the metro level, many of the top locations for manufacturing currently are also found in these states, though a few Rust Belt metros have also enjoyed a resurgence in manufacturing.
Nevada has experienced the most manufacturing growth over the past decade
The data used in this analysis is from the U.S. Bureau of Economic Analysis. To determine the locations where manufacturing is thriving, researchers at Construction Coverage calculated a composite score based on the following factors and weights:
- Manufacturing employment growth from 2010 to 2020 (2X)
- Manufacturing GDP growth from 2010 to 2020 (2X)
- Manufacturing share of total employment in 2020 (1X)
- Manufacturing share of total GDP in 2020 (1X)
In the event of a tie, the location with the greater manufacturing employment growth from 2010 to 2020 was ranked higher. To improve relevance, only metropolitan areas with at least 100,000 residents were included. Additionally, metros were grouped into cohorts based on population size.
Here are the U.S. metropolitan areas where manufacturing is thriving.
Small and midsize metros where manufacturing is thriving
15. Tampa-St. Petersburg-Clearwater, FL
Photo Credit: Kevin J King / Shutterstock
- Composite score: 59.2
- Manufacturing employment growth (2010–2020): +16.5%
- Manufacturing GDP growth (2010–2020): +48.1%
- Manufacturing share of total employment (2020): 4.0%
- Manufacturing share of total GDP (2020): 7.7%
14. Tucson, AZ
Photo Credit: RCole3 / Shutterstock
- Composite score: 59.4
- Manufacturing employment growth (2010–2020): +13.9%
- Manufacturing GDP growth (2010–2020): +28.4%
- Manufacturing share of total employment (2020): 5.7%
- Manufacturing share of total GDP (2020): 12.6%
13. Orlando-Kissimmee-Sanford, FL
Photo Credit: Songquan Deng / Shutterstock
- Composite score: 60.9
- Manufacturing employment growth (2010–2020): +33.5%
- Manufacturing GDP growth (2010–2020): +36.1%
- Manufacturing share of total employment (2020): 3.3%
- Manufacturing share of total GDP (2020): 4.9%
12. San Antonio-New Braunfels, TX
Photo Credit: f11photo / Shutterstock
- Composite score: 62.4
- Manufacturing employment growth (2010–2020): +13.7%
- Manufacturing GDP growth (2010–2020): +128.4%
- Manufacturing share of total employment (2020): 3.8%
- Manufacturing share of total GDP (2020): 9.5%
11. Austin-Round Rock-Georgetown, TX
Photo Credit: ShengYing Lin / Shutterstock
- Composite score: 62.6
- Manufacturing employment growth (2010–2020): +30.9%
- Manufacturing GDP growth (2010–2020): +21.9%
- Manufacturing share of total employment (2020): 4.5%
- Manufacturing share of total GDP (2020): 11.2%
10. Tulsa, OK
Photo Credit: Sean Pavone / Shutterstock
- Composite score: 63.7
- Manufacturing employment growth (2010–2020): +16.8%
- Manufacturing GDP growth (2010–2020): +20.5%
- Manufacturing share of total employment (2020): 9.1%
- Manufacturing share of total GDP (2020): 13.3%
9. Phoenix-Mesa-Chandler, AZ
Photo Credit: Sean Pavone / Shutterstock
- Composite score: 64.2
- Manufacturing employment growth (2010–2020): +22.2%
- Manufacturing GDP growth (2010–2020): +37.2%
- Manufacturing share of total employment (2020): 5.1%
- Manufacturing share of total GDP (2020): 9.6%
8. Raleigh-Cary, NC
Photo Credit: Sean Pavone / Shutterstock
- Composite score: 64.2
- Manufacturing employment growth (2010–2020): +14.4%
- Manufacturing GDP growth (2010–2020): +56.8%
- Manufacturing share of total employment (2020): 3.8%
- Manufacturing share of total GDP (2020): 15.1%
7. Portland-Vancouver-Hillsboro, OR-WA
Photo Credit: Bob Pool / Shutterstock
- Composite score: 67.2
- Manufacturing employment growth (2010–2020): +14.1%
- Manufacturing GDP growth (2010–2020): +28.8%
- Manufacturing share of total employment (2020): 8.5%
- Manufacturing share of total GDP (2020): 17.8%
6. Nashville-Davidson–Murfreesboro–Franklin, TN
Photo Credit: Mihai_Andritoiu / Shutterstock
- Composite score: 68.7
- Manufacturing employment growth (2010–2020): +22.6%
- Manufacturing GDP growth (2010–2020): +44.8%
- Manufacturing share of total employment (2020): 6.1%
- Manufacturing share of total GDP (2020): 10.3%
5. San Francisco-Oakland-Berkeley, CA
Photo Credit: Radoslaw Lecyk / Shutterstock
- Composite score: 70.0
- Manufacturing employment growth (2010–2020): +19.0%
- Manufacturing GDP growth (2010–2020): +65.2%
- Manufacturing share of total employment (2020): 4.8%
- Manufacturing share of total GDP (2020): 15.5%
4. Detroit-Warren-Dearborn, MI
Photo Credit: Sean Pavone / Shutterstock
- Composite score: 70.7
- Manufacturing employment growth (2010–2020): +22.9%
- Manufacturing GDP growth (2010–2020): +20.3%
- Manufacturing share of total employment (2020): 9.7%
- Manufacturing share of total GDP (2020): 17.0%
3. San Diego-Chula Vista-Carlsbad, CA
Photo Credit: Sean Pavone / Shutterstock
- Composite score: 70.9
- Manufacturing employment growth (2010–2020): +21.5%
- Manufacturing GDP growth (2010–2020): +58.6%
- Manufacturing share of total employment (2020): 6.1%
- Manufacturing share of total GDP (2020): 11.8%
2. San Jose-Sunnyvale-Santa Clara, CA
Photo Credit: Uladzik Kryhin / Shutterstock
- Composite score: 77.4
- Manufacturing employment growth (2010–2020): +9.8%
- Manufacturing GDP growth (2010–2020): +94.6%
- Manufacturing share of total employment (2020): 12.6%
- Manufacturing share of total GDP (2020): 24.2%
1. Grand Rapids-Kentwood, MI
Photo Credit: Henryk Sadura / Shutterstock
- Composite score: 79.6
- Manufacturing employment growth (2010–2020): +28.1%
- Manufacturing GDP growth (2010–2020): +20.3%
- Manufacturing share of total employment (2020): 16.5%
- Manufacturing share of total GDP (2020): 24.2%
Â
