Based on Record Profits, U.S. Manufacturing is Alive and Well and Had Its Best Year Ever in 2011
We've heard countless stories about the manufacturing job losses, but haven't heard much about the major rebound and renaissance of profitability in American manufacturing, which likely surged to all-time historical levels in 2011. Although fourth quarter data are not yet available, projections based on profits through the third quarter suggest that the after-tax profits of American manufacturing corporations exceeded $600 billion last year for the first time in history, and will be more than double the profits in 1995. Thanks to investments in advanced technology and major improvements in efficiency, the American manufacturing sector will be more than twice as profitable in 2011 as in 1995, adjusted for inflation. And part of that surge in manufacturing profitability to record highs is a direct result of the reduction in staffing levels by 5.5 million workers between 1995 and 2011.
Bottom Line: The true economic measure of the success of any company or industry is not the number of workers, the amount of output, or the level of sales revenue, it's the level of profitability. Based on that measure, American manufacturing is alive and well, and doing better than ever before.