Large Metros Dominate U.S. Manufacturing Landscape, Brookings Finds

A large majority of U.S. manufacturing jobs are located in large metropolitan areas, according to a new paper from the Brookings Institution Metropolitan Policy Program. In 2010, about 79.5 percent of manufacturing employment was centered in large metros and in central metropolitan counties. Over the past two years, however, there has been a slight shift in manufacturing activity back towards non-metro areas, as U.S. manufacturing has experienced a small resurgence. On the whole, the move towards metropolitan areas since 1980 has been healthy for the national economy, since it has allowed different cities to develop specialized industry clusters, according to the report.

The country's top 100 largest metropolitan areas and central metropolitan counties account for most U.S. manufacturing jobs, and an even larger majority of high-tech manufacturing employment. These regions encompass about 78.6 percent of moderately high-tech manufacturing jobs, and about 95 percent of jobs in very high-tech industries. Very high-tech industries include those in which science and engineering occupations represent more than five times the national average of total industry employment. These include computer and electronic product manufacturing, pharmaceutical and medicine manufacturing and aerospace product and parts manufacturing. More than 30 percent of employment in each of these industries exceed 30 percent.

High-tech manufacturing jobs appear to have flourished in metro areas due to the advantages offered by the agglomeration of related industries, research centers, pools of highly-skilled workers and access to other specialized resources. This also has led to specialization in the manufacturing industries of U.S. cities. Urban industry clusters vary greatly between cities and offer unique sets of benefits to businesses in different metros. The reports lays out six different categories of metropolitan manufacturing specialization groups, which demonstrate some general trends about how these specializations have evolved.

The authors suggest that the advantages of strong urban clusters and the potential environmental benefits of centralized manufacturing should be encouraged, and that the movement of manufacturers away from cities over the past two years is undesirable. Federal, state, local and metropolitan leaders should implement strategies, policies and programs that foster the development of urban clusters that promote innovation and collaboration. Policy leaders also should step in to discourage smokestack chasing through tax abatements and right-to-work laws. These sorts of policies merely promote the poaching of manufacturers from other states and lead to the haphazard agglomeration of unrelated businesses.

Read Locating American Manufacturing: Trends in the Geography of Production at: http://www.brookings.edu/reports/2012/0509_locating_american_manufacturi...