China continues to grow manufacturing is output. In 2009, the USA, and most countries saw declines in manufacturing production. China, however, continued to grow. China is now finally approaching the level of manufacturing done in USA. The latest data again shows the USA is the largest manufacturer but China looks poised to take over the number one spot soon.
The chart showing manufacturing output by country was created by the Curious Cat Economics Blog based on UN data (in 2009 USA dollars). You may use the chart with attribution.
The large decline in Germany was 23%. This was a 18% decline in Euro terms, and when you added the decline of the Euro the total USA dollar decline was 23%. Quite extraordinary. Most European countries were down over 15%. In fact, so extraordinary it makes me question the data. World economic data is useful and interesting but it isn’t perfect. USA manufacturing declined just .5%. China increased manufacturing production by 9%.
The last 2 years, China has stopped separating out mining and utilities from manufacturing. The percentage of manufacturing (to manufacturing, mining and utilities) was 78% for 2005-2007 (I used 78% of the manufacturing, mining and utilities figure provided in the 2008 and 2009 data – but that could be wrong). The unadjusted 2009 China total was $2.05 trillion and for the USA the total manufacturing, mining and utilities was $2.33 trillion. In 2009, the manufacturing total was 76% of USA manufacturing, mining and utilities. The percentage varies significantly between countries (the Russian federation is about 55% and Japan about 91%) and various over time as a countries economy changes.
The big, long term story remains the same. China has continued to grow manufacturing output tremendously. I see very little data to support the stories about manufacturing having to leave China to go elsewhere (especially when you look at the “lower wages” counties mentioned in news stories – they are not growing at any significant rate). The USA is still manufacturing a huge amount and that production has steadily grown over time.
When you look back over the period from 1980 to today you can see
- The biggest story is the growth in Chinese manufacturing
- The USA started out the largest and has grown significantly
- Japan did very well from 1980 to 1995, and since they have struggled
- The USA, China, Japan are really far ahead of other countries in total manufacturing output, and Germany is solidly in 4th place.
- After that the countries are fairly closely grouped together. Though there are significant trends hidden by the scale of this graph, which I will explore in future posts. South Korea has growth significantly over this period, for example.
- The biggest macro trend that the data shows, but is not so visible in this chart (other than China’s growth), is the very strong performance of emerging markets (and in fact some counties have fully become manufacturing powerhouses during this period, most notably China but also, South Korea and Brazil). And I see that continuing going forward (though that is speculation).
Two more interesting pieces of data. Italy is the 5th largest manufacturing country, I don’t think many people would guess that. Since 1980 Italy surpassed the UK and France but China rocketed passed them. And Indonesia has moved into 14th place, edging out Canada in 2009.
I plan to take more time in 2011 to look at global manufacturing and other global economic data more closely and to write about it here.
Related: Data on the Largest Manufacturing Countries in 2008 – Top 12 Manufacturing Countries in 2007 – Top 10 Manufacturing Countries 2006 – Leading global manufacturers in 2004
Comments
5 Comments so far
Your rankings likely are inaccurate because they miss Taiwan. The problem is your underlying data–UN data unfortunately, very politically, always leaves out Taiwan.
Very interesting article. The manufacturing data does not parallel the jobs losses and it may have to do with how the data is collected. Does this data reflect manufacturing activity within the country borders, or simply an aggregation of corporate figures? In other words, if a US corporation manufactures only half of its $100B products in US factories, will the data add $100B to US manufacturing or only $50B? Regards
I think to take account of job losses vs. manufacturing you need to also look at labor productivity. Manufacturing output and resulting employment in an age of ever increasing productivity are more and more disconnected.
China has finally actually taken the lead as the largest manufacturer in the world. Reading many news sources and blogs you may have thought the USA lost the lead a couple of decades ago, but you would be wrong…
it does mean fewer manufacturing jobs, which are very good jobs, exist. This is a shame but something we shouldn’t anticipate changing. Believing we will globally, or in the USA, return to the huge number of manufacturing that were available previously jobs is not a wise conclusion to reach…