You’ve probably heard this statement: “America doesn’t make anything anymore.” It’s one of those phrases that gets tossed around as if it’s a fact. But if you take a closer look, you’ll find that the truth about U.S. manufacturing is far more optimistic.
Yes, the American manufacturing sector has changed. It looks different than it did in the 1940s, when nearly 4 out of 10 American workers held factory jobs. As of May 2025, manufacturing jobs made up a bit more than 8 percent of the U.S. workforce. At first glance, that may seem like a collapse. But that’s not the full story.
The multiplier effect of America’s manufacturing jobs
Manufacturing jobs support jobs in other sectors. Every dollar spent on manufacturing creates $2.69 in total economic activity. This is one of the largest impacts of any sector. Manufacturing also supports a large supply chain, creating demand for raw materials, logistics and services that help other industries grow. This multiplier effect creates a huge impact on the American economy.
The National Association of Manufacturing reports that, including indirect and induced impacts, for every $1.00 spent in manufacturing, there is a total impact of $2.64 to the overall U.S. economy. Also, for each worker in manufacturing, 4.8 workers are added in the overall U.S. economy. And for every $1.00 earned in direct labor income in the manufacturing sector, $3.92 in labor income earned is added to the overall U.S. economy.
U.S. manufacturing output has grown more than twelvefold since the mid-20th century. The difference? Today’s factories are smarter, faster and more efficient. Thanks to advances in technology, automation and process innovation, we’re producing more than ever — but with fewer hands.
The United States used to have the world’s largest manufacturing sector, until China overtook it in 2010. In 2023, China accounted for 29 percent of global manufacturing output — almost 12 percentage points ahead of the United States, in second place. This development made headlines and fueled the narrative of American decline.
But again, the numbers tell a different story. The United States remains the second-largest manufacturer in the world, and the gap between number two and number three isn’t even close. In 2024, U.S. manufacturing output was so substantial that you’d have to combine the total production of Japan, Germany and South Korea to match it.
While much of the manufacturing in industries like apparel and basic electronics has shifted to lower-cost countries, the United States has not exited the manufacturing stage; instead, we’ve moved up the value chain. Today, America leads in high-skill, high-tech sectors such as aerospace, semiconductors, biotechnology, defense systems and precision equipment.
Another myth: Robots will replace most humans in manufacturing
Now that artificial intelligence (AI) is becoming more commonplace, you’ve probably heard it said that soon, robots will replace all humans, and there will be few jobs for people in the coming years. This is another misguided myth that the media often perpetuate. It simply isn’t true!
Yes, modern U.S. factories are powered by advanced robotics, AI-driven logistics, lean production systems and strong partnerships with research institutions and technology companies. However, today the focus is on quality, complexity and value — not on volume, like it once was.
Another myth that has circulated for years is that American workers don’t want to work in manufacturing jobs — whether or not robots take over those roles.
The truth is that robots now handle much of the automation that is a big part of manufacturing. This means that workers are no longer asked to do the mundane, repetitious work that people once performed. Instead, people now have the opportunity to get into careers that are dynamic and on the cutting edge. Plus, more manufacturing, whether or not it’s automated, leads to innovation, invention and more manufacturing, which means even more work for Americans.
Plus, many people are surprised to learn that manufacturing jobs pay well, averaging more than $102,000 a year. Many of these jobs also provide benefits like health insurance and give hard-working Americans the ability to provide for their families.
America is the most productive country in the world
One of the most overlooked parts of the manufacturing story is productivity. American manufacturing workers aren’t just busy; they are among the most productive in the world.
Labor productivity in the U.S. manufacturing sector increased 4.4 percent in the first quarter of 2025, as output increased 4.8 percent and hours worked increased 0.4 percent. This is the largest increase in productivity since the second quarter of 2021.
Many so-called experts predicted that — as a result of the pandemic, the war in Ukraine and the trade war — the U.S. economy would stagnate. However, those pundits, and the news headlines that published their misguided forecasts, were wrong.
In 2023 and 2024, the American economy grew at an annualized pace of 2.9 percent. Real gross domestic product (GDP) was 2.3 percent higher than projections made by the nonpartisan Congressional Budget Office before the pandemic in January 2020. In the United States, real GDP in the second quarter of 2024 was 8.7 percent higher than at the end of 2019. Compare this number to growth in Canada (5.5 percent), France (3.7 percent), Italy (3.3 percent), the United Kingdom (2.9 percent) and the European Union (1.9 percent).
The United States still leads the world in manufacturing, and our future is bright. That’s what should be in the headlines.
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So if you think America has stopped making things or that manufacturing is a thing of the past, it’s time to update that narrative. The U.S. manufacturing sector has not disappeared; it has evolved. And in many ways, it is stronger, more competitive and more vital to our economy than ever. Yes, the landscape has shifted. Yes, it looks different. But it’s better than you might think and stronger than the headlines suggest.
