Despite manufacturing’s decline as a share of the U.S. economy, it is still a significant sector, and an increasing number of surveys monitor its movements. Why this continuing strong interest in manufacturing? Because it is more cyclically sensitive than the total economy, the manufacturing sector can serve as an indicator of cyclical fluctuations as they develop.
The decline in the manufacturing sector as a share of the U.S. economy in the last half of the 20th century has been one of the most notable changes in the nation’s economic structure. In nominal terms (that is, in current dollars), manufacturing’s share of the total output of the U.S. economy is only about half of what it was in 1950. Manufacturing employment has also declined as a share total employment. These trends have been even stronger in the Third Federal Reserve District — Pennsylvania, New Jersey, and Delaware — than in the nation. Despite these trends, manufacturing is still a significant part of the U.S. economy, and it remains a key indicator of changes in national and regional economic conditions. Thus, even while manufacturing’s share of total output has declined, it continues to be closely monitored and analyzed. Data collection devoted to monitoring manufacturing has not declined; in fact, it has increased, and the manufacturing sector receives as much attention now, both nationally and regionally, as it ever has.View the Full Article