One of the many reasons why manufacturing jobs are good for our economy is that they create positive ripple effects throughout our communities. Each full-time job in manufacturing creates 3.4 full-time jobs in non-manufacturing industries, according to a 2016 study by the Manufacturers Alliance for Productivity and Innovation (MAPI).
MAPI looked at both “upstream” and “downstream” in the manufacturing value chain. So counted toward jobs created were: corporate offices and management, research and development, the transportation of materials and finished goods, logistics and warehousing, advertising, the retail industry that sells the final products and financial services and insurance providers. One job on the factory floor supports 3.4 other full-time jobs.
Take the auto industry. There are a lot of workers who are involved in making the pickup truck before it drives off the dealers’ lot:
- Miners produce coal and iron
- Steelworkers make steel
- Workers make plastic, glass and other materials
- Drivers transport steel and other raw materials
- Workers warehouse, unpack and sort the parts
- Drivers transport auto parts to the auto plant
- Autoworkers build the car
- Drivers transport the cars to dealers on trucks or trains
- Dealer salespeople sell the car
- Corporate office employees, salespeople, accountants, advertising employees, engineers, designers, utility workers, gas station workers, machine repair and skilled workers, warehouse workers, auto mechanics and dozens of other types of workers also touch the car along the way.
And these jobs all create other economic activity such as a new restaurant opening near the factory, or more teachers being hired to teach the children of the workers, or more clerks being hired at the home improvement store to help the new workers who are buying homes in the area.
Unfortunately, it’s also true that as these jobs disappear, there is another multiplier effect that happens. Vendors who supplied the factory also shutter, diners close, the tax base dwindles, the city cuts back on services, etc. It’s an endless cycle too many know too well.
Any way you cut it, it pays dividends to fight to bring back good manufacturing jobs.