Automation and how technology will change the way we work is an overarching theme in economic analysis today. Computing power has made workers more effective and efficient in a variety of industries, and in some settings human workers have been replaced altogether.
Manufacturing is a prime example. Products assembled by long lines of robotic equipment are a visible reminder of how technology has changed the way Americans work. Since 2000, American industrial output – defined as the total value of the country’s factories, mines and power plants – has grown by just over 10 percent, adjusted for inflation. In that same period, total employment – the number of working hours required to create that output – has shrunk by 29 percent. Technology has made American industry more efficient than ever, and factories are getting increasingly more production out of a shrinking workforce.
Best known for potatoes and dairy, agriculture has long been viewed as the staple of Idaho’s economy. While agriculture continues to play an important role, manufacturing has quietly become one of the leading industries driving the economy forward. In recent years Idaho has gained a unique competitive advantage in the industry with an increased concentration of manufacturing jobs being added to the economy. Although growth in manufacturing has struggled nationally, Idaho is poised to see continued growth in the industry.
Since the end of the recession in 2010, Idaho’s manufacturing industry has fueled the state’s economic expansion. Of the jobs added to Idaho’s economy between 2010 and 2014, manufacturing had the second highest growth rate at 12.7 percent – nearly doubling the state’s total job growth of 6.9 percent. The 6,700 jobs added in manufacturing accounted for 16 percent of the state’s total job growth since the end of the recession.
South central Idaho was named a manufacturing community by the U.S. Secretary of Commerce Penny Pritzker under the Investing in Manufacturing Communities Partnership Program. The emphasis is on food production, food processing and science.
The criteria encompassed six aspects of manufacturing and required strategies and outcomes to be developed in these areas:
- workforce and training;
- advanced research;
- infrastructure and site development;
- supply chain support;
- export promotion;
- and capital access.
The program stresses mutually beneficial partnerships and participation between the community’s industry, governmental leaders both local and state, and its economic development professionals.
Industry leaders in the food production and food processing arenas will have the opportunity for assistance in navigating the governmental intricacies of exporting product — individuals who are knowledgeable on U.S. policy as well as the country that could receive commodities or products from south central Idaho.
Specific strategies will be released over the coming year to make the huge food production and processing cluster more sustainable, more efficient and more profitable, particularly in the counties of Twin Falls, Jerome, Cassia and Minidoka.
Eleven other areas nationally received the designation in this second round.
Over the past two decades, manufacturing with its traditionally higher-paying jobs has become a smaller and smaller component of both the national and Idaho economies.
Manufacturing in Idaho has staged a modest rebound since the end of the recession, primarily in food processing – the lowest-paying piece of the three-part manufacturing super sector. But it still remained well below its 1990 levels although in 2013 manufacturing accounted for a greater percentage of Idaho jobs than it did nationally.
Even with that gain, however, the composition of Idaho’s manufacturing sector has changed significantly over the past 20 years even as its overall economic impact has declined. What was essentially a fairly even split of jobs among nondurable production like food processing, resource manufacturing like wood products, and other durables like computer chips and machinery, has become dominated by production of other durables as wood products manufacturing steadily contracted. Continue reading
In recent years, the manufacturing industry in the United States has been a skeleton of what it once was. As some manufacturers outsourced work to foreign countries in pursuit of cost savings, others simply struggled to stay alive, unable to keep up with increasing competition in an ever-expanding global economy.
From 2000 to 2010, manufacturing posted net job losses each year. Manufacturing jobs decreased 30 percent, losing more than 5 million jobs over the decade. Regardless of the cause, once proud cities like Detroit are left desolate by the relative death of the industry.
Manufacturing in Idaho and the rest of the United States has grown in the past four years as the economic recovery restored some of the jobs lost during the recession.
Employment in the industry plays a slightly larger role in Idaho’s economy than it does in the U.S. economy, especially in the north central and south central regions, which have seen the fastest manufacturing growth in recent years. The average Idaho worker earned $36,829 in 2013, while the average Idaho manufacturing worker earned $53,248. Manufacturers also tend to offer generous benefits packages including health insurance, paid leave and retirement. Many provide career ladders that help workers develop new skills and earn even more.
Idaho’s economy has generated about 16,000 nonfarm jobs in 2013. Health care, manufacturing, leisure and hospitality and construction were the most expansive sectors, accounting for 64 percent of the growth. The majority of jobs in every case were in southwestern Idaho, the state’s population center.
The biggest share was in manufacturing, which generated 16.5 percent of the new jobs, with durable manufacturing carrying the load. Since wages are typically higher in durable manufacturing than nondurable, those new jobs accounted for two-thirds of the $300 million in new wages that sector provided. The opening of the Chobani Greek yogurt plant in Twin Falls boosted nondurable manufacturing.