Manufacturing Is Smallest Share of US Economy in 72 Years, Bloomberg Reports
11 Nov, 2019
Bloomberg reports that manufacturing made up 11% of gross domestic product in the second quarter, the smallest share in data going back to 1947 and down from 11.1% in the prior period. The data is from a recent Commerce Department. Figures before 2005 were for full years only.
The latest number for manufacturing compares with 13.4% for real estate, 12.8% for professional and business services and 12.3% for governments, according to Commerce figures on GDP by industry.
Once a powerhouse of the U.S. economy, making up about a quarter of GDP in the 1960s, says Bloomberg, the manufacturing sector has steadily declined in importance. While manufacturing has added about half a million workers on the whole since President Trump took office, states like Pennsylvania and Wisconsin that helped him win in 2016 are now losing factory jobs amid a persistent trade war with China and a weaker global economy.
Bloomberg says the administration’s protectionist policies have disturbed companies’ supply chains, stymied investment and slowed hiring, and that tariffs on billions of dollars worth of Chinese products helped tip the manufacturing sector into recession earlier this year. Some recent figures suggest stabilization, but it remains fragile, the news service says.
Wednesday’s third-quarter GDP report is forecast to show the economy grew at the second-slowest pace of Trump’s presidency. On Friday, data may show manufacturing jobs dropped 55,000 in October from the prior month, largely reflecting the walkout of thousands of General Motors Co. employees.
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