The Manufacturing Sector has been regarded as a driving force in the recovery from the Great Recession.
A look at U.S. Manufacturing Shipments shows the sector’s contribution to the recovery may be slightly overstated. Consider the annualized growth rates for shipments for the following periods:
- January 1992 to January 2000, 8 years at +5.6%.
- January 2000 to January 2002, 2 years at -4.6%.
- January 2002 to January 2008, 6 years at +6.5%.
- January 2008 to January 2009, 1 year at -21.6%.
- January 2009 to January 2014 (est.), 5 years at +6.1%.
As a result of the Great Recession, shipments dropped to mid-2004 levels and it took 5 years before shipments returned to 2008 levels.
While it is good news that the manufacturing sector has played an important role in the recovery, it should be noted that the annualized rate of growth from 2012 to 2014 was only about 2.0%.
What’s on tap for manufacturing in 2014?
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