State of Manufacturing
in metro Milwaukee
| State of Manufacturing Report.pdf |
State of Manufacturing
Executive Summary
Manufacturing goes with Milwaukee like beer, brats, the Hoan Bridge and Giannis. It served as the backbone of our region’s economy for well over a century – providing the promise of a comfortable lifestyle for generations of families in the region.
Contrary to the popular narrative in some circles, those jobs and the promise they bring haven’t dried up here. According to figures just released in a new report from the Metropolitan Milwaukee Association of Commerce (MMAC), manufacturing is still a vital part of the region’s economy. In fact, with more than 111,000 employed in 2021, the industry serves as the region’s second-largest employer behind only the health care sector.
Contrary to the popular narrative in some circles, those jobs and the promise they bring haven’t dried up here. According to figures just released in a new report from the Metropolitan Milwaukee Association of Commerce (MMAC), manufacturing is still a vital part of the region’s economy. In fact, with more than 111,000 employed in 2021, the industry serves as the region’s second-largest employer behind only the health care sector.
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Regional employment down, but concentration high
Over the short-term, manufacturing job numbers have remained stable in the region, down only slightly - by 1,472 jobs – since 2010. Over the long-term, however, there has been a significant dip in the manufacturing sector – falling from 164,699 jobs in 2000. Nationally, the region compares favorably to the top-50 metros in the country when it comes to the concentration of those working in the sector. Milwaukee ranks second, only behind San Jose, in the percentage of its employees working in manufacturing. Several occupational areas of manufacturing saw large gains in employment since 2010. On the production side, CNC tool operators (up 95 percent) and welders (up 45 percent) saw large increases. On the professional side, industrial engineers (up 120 percent) and electrical engineers (up 47 percent) were among the biggest gainers, indicating a strong pool of regional talent in these areas. |
GDP up despite employment decline
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The value of manufacturing product has remained relatively stable, as well, although lagging relative to numbers shown state- and nationwide. In 2020 the real GDP of manufacturing goods produced in the region was $14.7 billion, a 0.7 percent increase from 2010. During that same period, the state saw an 8.7 percent increase, and the U.S. saw its real GDP in manufacturing increase by 10 percent.
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Manufacturing Statistics Comparison
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Manufacturing providing lucrative wages
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Manufacturing remains a relatively good option for those looking for a well-paying job in the Milwaukee area. Those working in the industry averaged an annual salary of $73,786. That compares to $61,395 for all other industries combined. Local salary figures were boosted in four of five manufacturing clusters. Jobs in energy, bioscience, machinery and printing outpaced the average pay in all other industries. Only the food and beverage manufacturing fell short of that average pay.
Since 2010, wages in manufacturing have increased in aggregate by 27.8 percent in the region – outpacing inflation by 3 ½ percentage points. The increase in wages matched the state (28%) but trailed the rest of the country (33 percent). |
The Future of Manufacturing
MMAC was fortunate to welcome Asutosh Padhi, Managing Partner for McKinsey in North America and author of “The Titanium Economy: How Industrial Technology Can Create a Better Faster, Stronger America,” to its State of Manufacturing event last week.
During his presentation, Padhi pointed to companies who embody the future of manufacturing – those who represent the “Titanium Economy.” These are oftentimes small, privately held companies on the forefront of industrial technology. These are the companies that develop and manufacture goods that we don’t often think about but play vital roles in items we use every day.
Padhi said they are not typically household names and oftentimes located in the heartland but are outperforming S&P 500 companies regularly. They invest in the latest technologies, provide inviting workplaces to attract highly skilled workers and align that talent to maximize efficiency.
During his presentation, Padhi pointed to companies who embody the future of manufacturing – those who represent the “Titanium Economy.” These are oftentimes small, privately held companies on the forefront of industrial technology. These are the companies that develop and manufacture goods that we don’t often think about but play vital roles in items we use every day.
Padhi said they are not typically household names and oftentimes located in the heartland but are outperforming S&P 500 companies regularly. They invest in the latest technologies, provide inviting workplaces to attract highly skilled workers and align that talent to maximize efficiency.
Metro Milwaukee Manufacturing Indicators
Importance of Manufacturing
Manufacturing’s importance to the metro area’s economy involves both its relative concentration and its stronger average pay levels. The metro area ranks second highest among major metros (1) in the U.S. in the percentage of its workforce in manufacturing. In addition, average annual pay levels in manufacturing rank 20% above average pay levels for the overall metro economy. The combination of these two facts indicate that the manufacturing industry is a major contributor towards the metro area’s overall prosperity.
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Among metro Milwaukee’s major industries, manufacturing’s 111,475 jobs in 2021 ranks second to the 136,475 jobs in health care and social assistance. By job growth the metro area posted a small 1.3% job decline in manufacturing over the 2010 to 2021 period, a loss of 1,472 jobs. The construction industry, up 28.6% in this period, posted the largest percentage job growth among major industry sectors while health care & social assistance registered the largest absolute job gain, up 19,330.
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Manufacturing Statistics for Peer Metro Areas
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The metro area’s manufacturing concentration ranks high relative to other metros but also ranks high among other major local industry sectors. Manufacturing’s job location quotient - a measure of concentration vs. national averages – stands at 1.65 (1.0 being the national average concentration) in the metro area, ranking second highest among major industry sectors. Among these 18 major sectors, manufacturing ranks seventh highest in average annual pay per worker, largely trailing only sectors with a significant professional occupation component.