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Manufacturing in Virginia: Producing More with Less

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Manufacturing often gets a bad rap.
That’s probably because the sector has declined by more than 4.9 million jobs since January 2000.
The industry also has perception issues. Who wants to work in a dirty old factory with oil on the floor and dust in the air?
But the manufacturing industry has changed — it is more high tech and offers better wages, making for a good career choice.
Manufacturing employs more than 12.6 million people in the U.S. The Bureau of Labor Statistics forecasts that figure will decline by about 900,000 in the next 10 years.
However, the sector will add about 2.8 million workers during that same period, because employees in manufacturing either are retiring or moving into new occupations.
And even though the industry is shedding jobs, output continues to grow. Since 2000, manufacturing production increased by 38 percent, or by $1.604 trillion, according to the Bureau of Economic Analysis. Total manufacturing output for 2015, the latest data available, was $5.83 trillion.
Productivity gains are part of the reason for the decline in jobs as well as the expected future decline.
Productivity in the manufacturing industry grew an annual average 1.7 percent from 2007 through 2016 compared with 1.1 percent for nonfarm businesses.
Although high productivity means doing more with fewer workers, it also means the remaining workers are paid well.
Average annual wages for manufacturing workers was $63,907 during the 12 months that ended Dec. 31, compared with $52,291 for all industries, based on data computed by Chmura Economics & Analytics.
The manufacturing industry is similar in the Richmond region.
It employs more than 32,000 workers locally. The sector is expected to shed about 2,700 jobs during the next decade.
Yet, more than 7,000 openings will occur as employees retire or switch occupations.
The average annual manufacturing wage during the 12 months that ended Dec. 31 was $63,015, compared with $49,162 for all industries.
And what about the perception issues?
Consider touring the Rolls-Royce North America plant in Prince George County, where the company makes components for aircraft engines.
As you drive to the plant in the Crosspointe development, you pass through a well-manicured campus that would convince you that you were in an upscale office park.
Entering the nearly 300,000-square-foot plant, you see spotless floors, large machines suspended off the floors, and workers with computer skills operating the facility.
On the same campus is the Commonwealth Center for Advanced Manufacturing, a 60,000-square-foot research center jointly operated by private companies and several Virginia universities.
The environment at both facilities is far from your grandfather’s plant.

(This article first ran in the Richmond Times Dispatch on April 3, 2017)
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