Manufacturing growth in some surprising places

by Ryan Streeter on June 22, 2014. Follow Ryan on Twitter.

Sometimes a single data point sums up a multi-faceted trend so well. This excerpt, from the latest ranking of the best manufacturing cities by Joel Kotkin and Michael Shires, summarizes a range of policy, economic, technological, and demographic trends:

Houston, with 255,000 manufacturing jobs, is not yet the country’s largest industrial center; it still lags behind the longtime leaders Los Angeles, with 360,000 manufacturing jobs, and Chicago, home to 314,000. But it is clearly on a stronger trajectory. Since 2008, Houston’s manufacturing workforce has expanded 5% while Los Angeles has lost 13% of its industrial jobs and Chicago’s factory workforce has shrunk 11%.

There was a time when the heavy metal industry you find in Houston today would have seemed unthinkable. But a combination of factors rooted in technology, policy, talent, and capital have made Houston a manufacturing powerhouse.

Kotkin and Shires point out that some traditional midwestern manufacturing hubs have rebounded well, so growth is still quite possible in industrial areas hit hard over the past few decades. For instance

[A]rguably the strongest Rust Belt recovery has occurred in Elkhart-Goshen, Ind., third on our small cities list. Since 2008 Elkhart’s industrial employment — much of it in the recreational vehicle industry — has expanded 30%, one of the most dramatic employment turnarounds of any place in America. Unemployment has fallen to 5% from a recession high of 20.2%.

The authors also point out that the Pacific Northwest has had some surprising growth in manufacturing in some not-so-intuitive places such as the Bay Area and Portland.