Current and Future Challenges for U.S. Manufacturing

40. Manufacturing's Share Within Countries Declines

The share of an economy’s value-added that is generated by manufacturing has been on the decline in the developed world for decades. In a nutshell, consumers increasingly demand services—often new ones—and producers make the necessary accommodations. But manufacturing in the United States plays a significantly reduced role in the economy relative to most of its industrial trading partners. Today, Germany’s and Japan’s manufacturing output relative to GDP stands some 6-12 percentage points higher than the American equivalent.
Such gaps call for political action. America can and should learn from its advanced peers. Whether it is via vocational training, labor relations, or export promotion, government involvement has proven supportive of the vibrant manufacturing tradition that all these countries share.

To Competitiveness

38

According to the UN, U.S. Manufacturing Slipped to #2

39

According to the World Bank, U.S and Chinese Manufacturing Are Comparable

40

Manufacturing's Share Within Countries Declines

41

Manufacturing Exports Alone Are Not Enough to Sustain U.S. Economic Growth

42

The U.S. Is the #1 Destination for Foreign Direct Investment

43

The U.S. Ranks High But Is Not the Easiest Country To Do Business In

44

Inflation-Adjusted Manufacturing Has Kept Up With the Overall Economy

45

Measuring the Quantity of Manufacturing GDP Is Distorted by High-Tech

46

Traditional Manufacturing Has Not Kept Up With Overall Economic Growth

47

The U.S. Has a Structural Cost Disadvantage

48

Among 9 Largest Trading Partners, Only France Has Higher Structural Costs Than the U.S

49

The U.S. Does Not Keep Pace With Falling Corporate Tax Rates

50

U.S. Healthcare Costs Are Skyrocketing

51

Commercial Tort Costs Climb Again

52

Despite Rhetoric, Regulations Are as Burdensome as Ever