Long Term Trends in Manufacturing EmploymentBureau of Business Researc

Zlatkovich, Charles P.

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UNIVERSITY AS AT AUST\ ': '\~~! -BUSINESS-+ -REVIEW-Bureau of Business Research • College and Graduate School of Business •The University of Texas at Austin Long Term Trends in Manufacturing Employment "..... . _,harles P Zlatkov1ch Associate Professor College of Business Administration University of Texas at El Paso Inside: Statistics from the new Directory of Texas Manufac-turers .............. 5, 6 . . FEBRUARY 1997 Texas leads the nation in increasing manufacturing employment during the past 25 years, according to data recently published by the U.S. Department of Commerce, Bureau of Economic Analysis. Three Texas metropolitan areas-Dallas-Fort Worth, Houston, and Austin-rank among the top ten metropolitan areas nationally in the creation of new manufac-turing jobs during the same period. A Nationwide Decline Nationwide, manufacturing employment has been declining during the period. In 1969, total manufacturing employment in the United States exceeded 20.5 million. By 1994, manufacturing employment had declined to about 19 million-a loss of 1.5 million jobs. Although the nationwide totals from the past quarter century present a bleak picture for manufacturing employ-ment, most of the decline is confined to a relatively small group of states: New York, Pennsylvania, Illinois, New Jersey, Ohio, Massachusetts, Michigan, Connecticut, Maryland, and Indiana. New York experi-enced the most severe decline, with more than 900,000 jobs lost. The total decline in manufacturing jobs in the ten states with the most severe losses is more than 3.5 million. However, while these and other states have suffered a loss of manufacturing jobs, employment in this sector has been in-creasing in 34 states. The growth is rather modest in many, but ten states have shown significant gains in new manufacturing jobs. The states with the largest numbers of new jobs in this sector are Texas, Califor-nia, Florida, North Carolina, Georgia, Arizona, Minnesota, Arkansas, Colorado, and Mississippi. With the exception of Minnesota, all are Sunbelt states. Five other states recording solid growth are Tennessee, Washington, Wisconsin, Alabam,a,jyld Utah, a more geographically diverse i~roup. (All of the states and the District of Columbia are ranked by the amount of change in manufacturing employment in table 1.) Metropolitan Area Trends Sharp contrasts also exist among metro-politan areas. Nationwide data indicate a net shift of manufacturing jobs out of metropolitan areas into less populated areas. The overall net job loss for all 271 U.S. metropolitan areas is more than 2.3 million, while the nation's nonmetropolitan areas have gained more than 800,000 manufacturing jobs. 1 Despite the overall decline, most metro-politan areas have actually seen increases in the number of manufacturing jobs during the period. Nationwide, 164 metro-politan areas have experienced increases while 106 areas had declines. In one area, the totals for 1969 and for 1994 were identical. Although fewer areas experi-enced declines, several saw very large Table 1 Change in Manufacturing Employment, States, 1969-1994 Rank Area Change Rank Area Cbangt"' -1 Texas 288,516 27 Iowa 21,430 2 California 181,946 28 North Dakota 12,647 3 Florida 173,629 29 Louisiana 11,733 4 North Carolina 146,774 30 Alaska 11,160 5 Georgia 108,525 31 New Hampshire 6,201 6 Arizona 100,547 32 Vermont 4;179 7 Minnesota 95,628 33 Wyoming 4,095 8 Arkansas 90,888 34 Montana 2,223 9 Colorado 84,204 35 Hawaii -5,025 10 Mississippi 81,425 36 District of Columbia -6,365 11 Tennessee 77,265 37 Delaware -10,945 12 Washington 73,064 38 Maine -17,263 13 Wisconsin 72,582 39 Rhode Island -38'.~ 14 Alabama 68,153 40 Missouri -43,823 15 Utah 68,126 41 West Virginia -48,717 16 Kentucky 61,497 42 Indiana ·82,209 17 Oregon 52,368 43 Maryland -97,191 18 Oklahoma 45,217 44 Connecticut -183,809 19 Virginia 43,945 45 Michigan -223,252 20 Kansas 43,498 46 Massachusetts -225,751 21 South Carolina 38,436 47 Ohio -386,342 22 Idaho 35,803 48 New Jersey -386,671 23 New Mexico 30,210 49 Illinois -444,615 24 South Dakota 28,492 50 Pennsylvania -626,872 25 Nevada 28,031 51 New York -906,793 26 Nebraska 23,124 Source: U.S. Department of Commerce, Bureau of Economic Analysis, Regional Economics lnforma-lion System CD-ROM, June 1996. Texas Business Review 2 February 1997 The ten metropolitan areas with the highest levels of growth in manufacturing jobs include three Texas metro areas. Texas Business Review losses. New York City, for example, lost more than 1 million manufacturing jobs; Chicago, more than 400,000 jobs. The gain in manufacturing jobs for the ten metropolitan areas with the highest increases was just under 600,000, much less than the number lost in the greater New York metropolitan area. (The ten metropolitan areas with the highest levels of growth in manufacturing jobs include three Texas metro areas and are listed in table 2.) The contrast in major California metropolitan areas is interesting. While the greater Los Angeles metropolitan area lost almost 73,000 manufacturing jobs, the San Francisco consolidated metropolitan area (which includes Silicon Valley) had the largest increase of any area in the nation and San Diego also ranked among those with large increases. The presence of Minneapolis, Portland, and Seattle among the areas with manufacturing growth also indicates that growth was not limited to Sunbelt cities. Table 2 U.S. Metropolitan Areas with Greatest Increases in Manufacturing Employment, 1969-1994 Metropolitan area Number of jobs San Francisco, California 108,779 Phoenix, Arizona 70,695 Dallas-Fort Worth, Texas 67,132 Houston, Texas 56,169 San Diego, California 54,803 Austin, Texas 51,793 Minneapolis, Minnesota 47,314 Denver, Colorado 46,383 Portland, Oregon 46,272 Seattle, Washington 45,704 Source: U.S. Department of Commerce, Bureau of Economic Analysis, Regional Economics Information System CD-ROM, June 1996. 3 Texa~ Metropolitan Area Trends Most parts of Texas shared in manufac-turing job growth. (Table 3 details manu-facturing job increases and decreases in Texas metropolitan areas.) In Texas metropolitan areas, the number of manu-facturing jobs increased by 36 percent from about 675,000 in 1969 to 921,000 in 1994. The growth rate was slightly higher in the nonmetropolitan portions of Texas but the numbers were much smaller. Manufacturing jobs in nonmetropolitan counties increased from about 96,000 in 1969 to 138,000 in 1994, an increase of almost 45 percent. The Dallas-Fort Worth, Austin-Sar:i Marcos, and Houston-Galveston-Brazoria metro areas led the state in manufacturing job growth, each gaining more than 50,000 jobs during the 25-year period. Other metropolitan areas with increases of more than 10,000 jobs in manufacturing were El Paso, San Antonio, and McAllen-Edinburg-Mission. Six Texas metropolitan areas more than doubled their manufacturing employment during the period: Austin, Brownsville, El Paso, McAllen, Bryan, and Killeen. Other areas in which manufacturing employment grew by more than 50 percent during the period were Wichita Falls, San Angelo, Laredo, Odessa-Midland, and Amarillo, all relatively small metropolitan areas. Only four Texas metropolitan areas experienced a net decline in the number of manufacturing jobs. In Sherman-Denison and in Abilene the declines were relatively modest, representing net changes of fewer than 1,000 jobs. The decline in Beaumont-Port Arthur can be attributed to the severe changes that have affected the oil and petrochemical industries during the period. The Texarkana decline is a bit of a fluke, resulting from cutbacks at the Lone Star Army Ammunition Plant. The Vietnam conflict was still raging in 1969, which increased employment at that facility. There are other statistical anomalies. As noted earlier, the Dallas-Fort Worth area showed the largest net increase of any metropolitan area in the state and ranked third in the nation in manufacturing job February 1997 Table 3 Manufacturing Employment in Texas Metropolitan Areas, 1969-1994 Area 1969 1994 Change 1969-1994 Abilene 4,272 3,935 -337 Amarillo 6,367 9,721 3,354 Austin-San Marcos 14,077 65,870 51,793 Beaumont-Port Arthur 37947 25,093 -12,854 Brownsville-Harlingen-San Benito 4,776 14,051 9,275 Bryan-College Station 1,636 4,194 2,558 Corpus Christi 11,164 14,303 3,139 Dallas-Fort Worth 278991 346,123 67,132 El Paso 22,802 48,042 25,240 Houston-Galveston-Brazoria 161,856 218,025 56,169 Killeen-Temple 4,270 10,365 6,095 Laredo 1,046 1,760 714 Longview-Marshall 15,210 17,769 2,559 Lubbock 7,290 8,724 1,434 McAllen-Edinburg-Mission 3,313 13,558 10,245 Odessa-Midland 4,650 7,208 2,558 San Allgelo 3,064 5,700 2,636 San Antonio 37,232 52,025 14,793 Sherman-Dennison 11,028 10,364 -664 Texarkana 14,395 5,975 -8,420 Tyler 10,392 12,905 2,513 Victoria 2,464 3,344 880 Waco 14,371 16,917 2,546 Wichita Falls 4,070 8,031 3,961 Total metropelitan areas 676,683 924,002 247,319 NonmetropoHtan counties 95$52 138,265 42,713 Total state 771,o6S 1,0S9$81 288$16 Note: Totals for metropolitan and nonmetropolitan areas do not add to state total because Texarkana metro area includes Arkansas portion. Source: U.S. Department of Commerce, Bureau of Economic Analysis, Regional Economics Information System, CD-ROM, June 1996. Texas Business Review 4 February 1997 growth; in percentage terms its growth was actually lower than the statewide average. The Dallas-Fort Worth area started the period with a major manufacturing base .nd suffered several cutbacks and losses during the period. In a similar vein, areas such as McAllen, Brownsville, Bryan, and Killeen recorded astounding percentage growth, but started with rather small base numbers. The only areas to rank high on both lists-absolute growth and percentage growth-were Austin and El Paso. Austin · leads in both cases by wide margins. Texas County Trends As might be expected, all of the counties with very large increases in manufacturing employment are located in metropolitan areas. Travis County leads the state in job growth with an increase of more than 42,000 manufacturing jobs during the period. Three other counties-Harris, El Paso, and Dallas counties-added more than 20,000 jobs, and increases of more than 5,000 occurred in twelve counties: Collin, Denton, Hidalgo, Bexar, Cameron, Brazoria, Tarrant, Fort Bend, Williamson, Montgomery, Bell, and Ellis. Of the state's nonmetropolitan counties, Titus County (Mount Pleasant) had the largest increase in manufacturing jobs with a gain of more than 3,400 jobs. Other nonmetropolitan counties and their princi-pal cities with increases of more than a thousand manufacturing jobs are Nacogdoches (Nacogdoches), Moore (Dumas), Hale (Plainview), Erath (Stephenville), Washington (Brenham), Grimes (Navasota), Carson (Panhandle), Parmer (Friona), Walker (Huntsville), Austin (Sealy), Jackson (Jacksboro), Lamar (Paris), Cass (Atlanta), Polk (Livingston), Runnels (Ballinger), and Shelby (Center). Note 1. For this study, the consolidated metropolitan area definitions have been used. There are 313 individual metropolitan areas nationwide, but when adjoining areas such as Dallas-Fort Worth and Houston-Galveston are consolidated, the number of metro-politan areas drops to 271.+ Top Industries in Texas by Area, 1996 (ranked by percentage of total plants) SIC Description Austin Dallas Houston Metro Nonmetro rank I % rank I % rank I % rank I % rank I % 20 Food & kindred products 3 9.9 27 Printing, publishing, & 1 19.4 2 14.2 3 10.5 3 12.5 1 14.3 allied industries 28 Chemicals & allied products 4 12 30 Rubber & miscellaneous 5 6.1 5 7.2 4 6.1 plastics products 32 Stone, clay, shell, glass, & 5 9.4 concrete products Fabricated metal products, 34 except machinery & 3 9.1 3 12.6 1 18.8 2 14.7 4 9.4 transportation equipment Industrial & commercial 35 machinery & computer 2 11.9 1 14.3 2 18.8 1 15.0 2 12.0 equipment Electronic & other electrical 36 equipment & components, 4 8.2 4 8.6 except computer equipment 139 Miscellaneous 5 8.0 5 5.9 manufacturing industries Source: 1997 Directory of Texas Manufacturers, Austin: Bureau of Business Research, 1997. Texas Business Review 5 The Dallas-Fort Worth, Austin-San Marcos, and Houston-Galveston-Brazoria metro areas led the state in manufacturing job growth, each gain-ing more than 50,000 jobs during the 25-year period. February 1997 Texas Business Review is published six times a year (February, April, June, August, October, and December) by the Bureau of Business Research, University ofTexas at Austin. Subscriptions to Texas Business Review are available free upon request, as are back issues. Research and service activities of the Bureau of Business Research focus on the ways Texas industries can become nationally and globally competitive. The Bureau is policy oriented and dedicated to public service. An integral part of UT-Austin's Graduate School of Business, the Bureau is located on the sixth floor of the College of Business Administra-tion building. BUREAU OF BUSINESS RESEARCH P.O. Box 7459 Austin, Texas 78713-7459 Address Correction Requested 11 ••• 11 .. 1.1 ••• 1 ••• 11 •• 11 .. 1 •• 11 NONPROHT-UiC U.S. Postage ·1 PA IQ, Austin, Texas Permit No. 1630 Editor: Lois Glenn Shrout shrout@mail.utexas.edu ::t.·::t:.:K::K::t:::t."."«.'t.':t:::K.":K.":K::K."t:::K.'t.'.":K::K.'$.'::K::t:::K.':K.'$.".":K::t:.":K::t."."¥:3-D I GIT ?B? Assistant Editor: Sales Office: Sally Furgeson sallyf@mail.utexas.edu (512)471-5179 (512)471-1063 fax dhardy@mail.utexas.edu J8384 SJ SERIALS ACQUISITIONS TJ--1£ GENERAL l .! BRAR .f ES LIT AT ,::~UST.TN PCL J . . 1 .14 AUST JN T8 ?8?.13 General: bbr@uts.cc.utexas.edu WWW· http:/ /www.utaxas.edu/depts/bbr/tbr/ Employment Size Ranges for Texas Manufacturing Plants, 1996 Ranges Metropolitan Nonmetropolitan 1to9 10 to 19 20 to 49 50 to 99 100 to 249 250 to 499 500 to 999 1,000 to 4,999 5 ,000 and over 36.8 17.7 18.8 9.0 7.8 2.3 1.2 0.6 0.04 46.7 15.0 15.4 8.1 5.8 2.2 1.0 0.7 0.0 not reported 5 .8 5 .1 Area of Widest Product Distribution for Texas Manufacturing Plants, 1996 Product distribution Metropolitan Nonmetropolitan State 28.7 National 43.8 Export 25.4 Not reported 2.1 Source: 1997 Directory of Texas Manufacturers, Austin: Bureau of Business Research, 1997. Texas Business Review 40.2 39.6 16.2 4.0 Announcement The 1997 Directory of Texas Manufacturers will be available in February. Listing more than 16,000 Texas plants, the directory includes product information, sales volume, and names of selected officers. Nearly 800 new firms have been added and 60 percent of the 1996 listings up-dated. The two-volume set is supple-mented monthly by reports on new and expanding firms in Texas Indus-trial Expansion. The publications are available as a package for $135 plus tax for Texas residents. Texas Indus-trial Expansion may be purchased separately for $50 and both publica-tions are available in electronic form. To order by phone, call toll free 1-888-212-4 DTM; by fax, (512) 471-1063. For company information on diskettes or mailing labels, call (512) 471-5180 for details.+ February 1997 P ·':> .:... 

Long Term Trends in Manufacturing Employment

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