By Connor O’Brien

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By August Benzow and Connor O’Brien

Manufacturing employment in the United States has surpassed its pre-pandemic levels, the first time since the 1970s that the sector has regained all the jobs it lost in a recession. Yet its recovery lags behind job growth in other sectors of the economy and masks large regional disparities. 

In nearly half of the country’s states — and fully half of all counties — manufacturing employment has not yet rebounded to 2019 levels. The manufacturing recovery has not reached, for example, the so-called “Rust Belt” states of Pennsylvania, Ohio, Indiana, Illinois, Michigan, and Wisconsin. 

In contrast, states in the Sun Belt and Mountain West, such as Florida, Texas, and Utah, are well above pre-pandemic manufacturing employment. 

The post-pandemic period also shifted manufacturing growth away from rural areas and towards small urban counties, which have become the sector’s primary drivers of job creation. Small urban counties have accounted for 61 percent of new manufacturing jobs added since 2019, while rural manufacturing employment has fallen outright.

Finally, most of the specific industries within the manufacturing sector have also grown more slowly post-pandemic (2019-2023) than in the prior four-year period (2015-2019). Computer and electronics manufacturing is a notable exception, growing significantly faster after 2019 than before, likely spurred by the post-pandemic semiconductor boom. 

A full recovery — but still lagging the rest of the economy

In every economic expansion since the late 1970s, the U.S. manufacturing sector has failed to recover the jobs it lost in the preceding recession — until now. 

The COVID-19 recession dealt a severe blow to the sector, which lost 650,000 jobs in 2020. But by 2023, it had entirely recouped these losses, with total manufacturing employment above 12.9 million workers, just exceeding the 2019 figure of 12.8 million. 

Despite this encouraging comeback, manufacturing’s overall importance in the U.S. job market continues to wane. In 1970, the sector employed roughly 18 million workers, or 31 percent of private sector employment. By 2010, manufacturing jobs accounted for only 10.7 percent of the private workforce. As of 2023, the share was down to 9.7 percent. 

Technological change and automation, international trade, and a broad shift toward service sector employment in the U.S. have all contributed to the secular decline of manufacturing employment.^[1]

Manufacturing employment by industry

Most individual manufacturing industries have recovered from their pandemic job losses, but only jobs in two of them — computer & electronics manufacturing and chemical manufacturing — are growing faster than before the pandemic.

Employment in computer & electronics manufacturing has reached its highest level since 2011. The recent gains were accompanied by enormous growth in construction in this industry. Despite the recent uptick, however, there remain 39 percent fewer jobs in computer & electronics manufacturing than in the year 2000. 

The transportation and food manufacturing industries have accounted for the lion’s share of job growth in the manufacturing sector post-pandemic; these were also the two leading industries for job growth within manufacturing after the Great Recession.

In contrast, metal manufacturing is struggling in the post-pandemic economy. After adding 21,000 jobs from 2015 to 2019, employment in the industry has since fallen by 46,000. 

Other industries below their pre-pandemic employment levels — including furniture, apparel and textiles, and paper and printing — were already experiencing weak or negative growth throughout the 2010s.

Manufacturing job growth and regional disparities

While manufacturing jobs have surpassed pre-pandemic levels nationally, this growth is highly concentrated geographically. Twenty states, plus the District of Columbia, still have fewer manufacturing jobs than before the pandemic. 

Of the 30 states with an increase in manufacturing jobs, just five have accounted for nearly two-thirds of all manufacturing jobs created in those states since 2019. Four of the five—Texas, Florida, Georgia, and Arizona—are in the Sun Belt. The other state, Utah, is in the Mountain West, where Nevada and Idaho have also enjoyed robust post-pandemic growth in manufacturing jobs. 

In contrast, from 2015 to 2019, manufacturing jobs increased in 43 states, with the top 5 states representing only 34 percent of the new jobs added during that time. Michigan ranked second in terms of new jobs added from 2015 to 2019 but fell to 48th from 2019 to 2023.

Texas has emerged as the clear leader, adding more than 49,000 new manufacturing jobs since 2019. Following closely behind is Florida, which has added nearly 37,000, with Georgia third at just above 20,000. While not the largest in absolute growth, Utah stands out as the state with the fastest relative growth in manufacturing employment, with an 11.8 percent surge (or about 16,000 jobs) since 2019.

Meanwhile, the so-called “Rust Belt” continues to rust. This group of states—Pennsylvania, Ohio, Indiana, Illinois, Michigan, and Wisconsin—has collectively lost 58,000 manufacturing jobs (-1.7 percent) since 2019. Not a single state in the Rust Belt has returned to its pre-pandemic employment level. 

In Northeastern states like New York (-18,000 jobs, -4.2 percent) and Massachusetts (-7,000 jobs, -2.9 percent), relative declines have been even larger post-pandemic. 

Of the ten states with the largest number of manufacturing jobs, seven have suffered absolute declines in those jobs since 2019. This trend reflects the sector’s geography shifting south and west. Yet, in each of those seven states, overall employment growth was positive because enough jobs were created in the other parts of their economies to overcome the manufacturing shortfall. 

The difference between overall and manufacturing job growth since 2019 was particularly stark in North Carolina, where manufacturing employment fell 1.6 percent while total jobs have grown 7.4 percent — ranking it as the seventh fastest-growing state nationwide in terms of overall job creation.

While each region and state has its own challenges that may explain why its manufacturing sector has struggled to expand in the post-pandemic economy, one simple reason that often applies is a dependence on declining sectors. 

North Carolina, for example, is highly specialized in furniture manufacturing, an industry struggling with a decline of almost 4,000 jobs in the state, mirroring its national struggles. Similarly, Michigan has a concentration of jobs in transportation and equipment manufacturing, but it is still a few hundred jobs short of its pre-pandemic levels in this industry.

Rural losses, small-urban growth

The pandemic significantly reshaped the distribution of manufacturing job growth across different county types in the United States. 

Before COVID-19, large urban and suburban counties enjoyed the fastest job growth in the sector. Since 2019, however, small urban counties have become dominant in manufacturing job creation. These areas, which previously accounted for less than 20 percent of new manufacturing jobs in the four years before the pandemic, have accounted for 61 percent of all manufacturing jobs added from 2019 to 2023.^[2]

Even more striking is the lagging growth in rural counties. From 2015 to 2019, about 17 percent of new manufacturing jobs were created in rural counties. However, since 2019, rural counties have collectively lost 20,000 manufacturing jobs — the only type of county that has yet to rebound to its employment level from before the pandemic (large urban counties have experienced a slight decline but are essentially at their 2019 levels). 

A possible explanation for the shift to small urban counties is that manufacturers are increasingly drawn to places that combine the advantages of affordable, available land for development (hard to find in larger urban settings) with access to substantial labor markets nearby (less likely in rural places). 

McLean County, Illinois, is a standout success story among the small urban counties. Home to the two small cities of Normal and Bloomington, the county added 7,100 manufacturing jobs between 2019 and 2023, largely due to a major expansion by the automaker Rivian. This is the fourth-highest increase in manufacturing employment nationally and lifted McLean above its 2001 levels after two decades of decline.

Not every small urban county in the Rust Belt is faring as well. Calhoun County, Michigan, which includes the cities of Battle Creek and Marshall, still has a thousand fewer jobs than it did in 2019, with losses concentrated in the transportation equipment manufacturing industry.

Defying the national trend for rural counties, Jackson County, Georgia, has enjoyed a significant increase in manufacturing jobs. Attracting major investments from SK Battery, Jackson County has added more manufacturing jobs since 2019 than any other rural county in the United States. In 2023, it had an estimated 9,905 manufacturing jobs, up more than 4,100 since 2019. The Southeast region generally has become a hub of investment in electric vehicle manufacturing, perhaps driven by incentives in the Inflation Reduction Act, and this growth is likely to accelerate in the coming years as recent investments begin to translate into operational factories.

In contrast, Noble County, Indiana, experienced the most significant decline in rural manufacturing jobs of any county in the U.S., losing 1,700 jobs since 2019, likely due to slowing demand for RVs post-pandemic (In recent years, RV production has expanded from neighboring Elkhart County into Noble). Rural counties in Indiana collectively shed 6,000 manufacturing jobs in the last four years, making them the primary driver of the state’s overall decline in manufacturing employment.

Appendix

Urban-rural definitions

Data sources

All data is sourced from the Bureau of Labor Statistics. National data is based on the Current Employment Statistics survey, while state and county data is derived from the Quarterly Census of Employment and Wages survey.

REFERENCE MATERIALS

Notes

1. /wp-content/uploads/2024/07/TAWP-Handley.pdf
2. Note: This number represents the share of gross job growth, not net growth. Rural counties’ losses are excluded.

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