U.S. Manufacturing in International Perspective

About this book

The health of the U.S. manufacturing sector has long been of great concern to Congress. The decline in manufacturing employment since the start of the 21st century has stimulated particular congressional interest. The Obama Administration has undertaken a variety of related initiatives, and Members have introduced hundreds of bills intended to support domestic manufacturing activity in various ways. The proponents of such measures frequently contend that the United States is by various measures falling behind other countries in manufacturing, and they argue that this relative decline can be mitigated or reversed by government policy.This report is designed to inform the debate over the health of U.S. manufacturing through a series of charts and tables that depict the position of the United States relative to other countries according to various metrics. Understanding which trends in manufacturing reflect factors that may be unique to the United States and which are related to broader changes in technology or consumer preferences may be helpful in formulating policies intended to aid firms or workers engaged in manufacturing activity. This report does not describe or discuss specific policy options.The main findings are the • China displaced the United States as the largest manufacturing country in 2010, as the United States’ share of global manufacturing activity declined from 30% in 2002 to 17.4% in 2012.• Manufacturing output has grown more rapidly in the United States over the past decade than in most European countries and Japan, although it has lagged China, Korea, and other countries in Asia.• Employment in manufacturing has fallen in most major manufacturing countries over the past two decades. The United States saw a disproportionately large drop between 2000 and 2010, but its decline in manufacturing employment since 1990 is in line with the changes in several European countries and Japan.• U.S. manufacturers spend far more on research and development (R&D) than those in any other country, but manufacturers’ R&D spending is rising more rapidly in China, Korea, and Taiwan.• A large share of manufacturing R&D in the United States takes place in high- technology sectors, particularly pharmaceutical and electronic instrument manufacturing, whereas in other countries a far greater proportion of manufacturers’ R&D outlays occur in medium-technology sectors such as motor vehicle and machinery manufacturing.