Great Lakes States Feeling the Pain
Even as economists worry about the loss of manufacturing jobs nationwide, a study by the Brookings Institution (Washington) has found that the "Rust Belt" is being hurt worst of all.
Between 1995 and 2005, the United States lost more than 3 million manufacturing jobs. Nearly all of this job loss occurred during the last five years, and 37.5 percent of the loss occurred in the seven Great Lakes states: Illinois, Indiana, Michigan, New York, Ohio, Pennsylvania and Wisconsin.
Michigan lost the most manufacturing jobs between 2000 and 2005-nearly 218,000-followed by Ohio, Illinois, and Pennsylvania.
On a positive note, the study found that manufacturing remains a major driver of the nation's economy and the economy of the Great Lakes region, thanks to recent increases in productivity.
In fact, because productivity is higher in manufacturing than in other sectors of the economy, manufacturing still tends to account for a higher share of gross state product than its share of employment. This is true both nationwide and in six of the seven states in the Great Lakes manufacturing belt. For example, productivity in the manufacturing sector increased by 38 percent between 1997 and 2004, a much higher increase than the 24.4 percent growth in productivity for all non-farm businesses during that same time period.
Nonetheless, the loss of manufacturing jobs is having an effect, especially in the Rust Belt's cities, where all but one lost manufacturing jobs during the last decade. The biggest losers in terms of absolute numbers were Chicago and Detroit, which have both lost about 100,000 manufacturing jobs in the past 5 years. Canton, OH, and Flint, MI, have also faired especially poorly, losing the greatest shares of manufacturing employment.
Looking at the big picture, the study found that manufacturing job losses were a major reason for slow overall job growth in the region. True, there have been employment gains in high-wage advanced service industries in recent years. But, in all but one of the 25 metropolitan areas studied, they were not large enough to offset the loss of manufacturing jobs in most areas.
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