Report highlights Pa. as sixth greatest industrial economy in nation
A new, in-depth report by the Northeastern PA Industrial Resource Center spotlights the impact of manufacturing across the Commonwealth and Pennsylvania's strong position among all states.
The Keystone State is the sixth largest goods producing state in the country, holds the sixth position in terms of number of manufacturing jobs, and is home to nearly 4.5% of America's total advanced manufacturing workforce.
NEPIRC President and CEO Eric Joseph Esoda said his organization researched and produced the report independently of any other organization.
"This report objectively presents the most important metrics, trends and measures relative to Pennsylvania's manufacturing economy and uses unbiased data and rigorous analysis to compare the Commonwealth's industrial economy to other sectors within the state and to those of our peer group states across the nation," Esoda said.
Esoda went on to explain that while, for the sake of analysis, the report occasionally presents the manufacturing sector as "vertical" — meaning a sector distinct from other segments of the economy such as agriculture, energy or health care.
"Manufacturing is actually much more 'horizontal' than 'vertical' because it is essential to the success of a multitude of other sectors," Esoda said. "Simply put, Pennsylvania cannot compete and win in arenas such as aerospace, agribusiness, alternative energy, biotechnology, infrastructure, pharmaceutical readiness or natural resource utilization without the resident manufacturing capability to support those sectors."
Key statistics
Esoda said the statistics detailed in the report illustrate the importance of manufacturing throughout the Commonwealth.
For example, across Pennsylvania manufacturing accounts for:
—More than $116 billion in Gross State Product (GSP) — or 13.8% of the Commonwealth's total GSP.
—Over 575,000 full-time jobs.
—Nearly $41 billion in annual wages paid to employees.
—Over $43 billion in exports to other nations.
While impressive in its own right, Esoda said the data in the report actually understates the true impact of Pennsylvania's manufacturers because it reflects only the employment, wages, output and economic activity directly related to Pennsylvania's nearly 15,000 manufacturing firms.
"Economists recognize that manufacturing has among the highest employment, earnings and sales multiplier effects of any industry — meaning that each dollar of sales and net earnings recorded by a manufacturing firm and each direct manufacturing job supports a multitude of sales, earnings and jobs in downstream industries such as services, transportation and logistics, retail and so forth," explained Esoda, "So the true impact of our great manufacturers is exponentially higher when those indirect benefits are considered."
Competitive national position
The report highlights that over the past 15 years Pennsylvania's manufacturing output increased by 49.3% — from $77.8 billion to $116.3 billion. That rate of growth surpassed that of competitor states Michigan (39.6%), Ohio (39.6%), North Carolina (28.1%) and New York (22.2%).
Pennsylvania's industrial growth even surpassed that of high-growth states like Indiana (46.9%) and Texas (45.9%). Esoda said the expansion of Pennsylvania's manufacturing economy also enabled the state to move from the eighth largest industrial economy in the nation to the sixth largest.
In addition to being the sixth largest goods producing state in the country, Esoda said Pennsylvania holds the sixth position in terms of number of manufacturing jobs.
Except for during the pandemic, Esoda said Pennsylvania has consistently added manufacturing jobs and has risen to become home to nearly 4.5% of America's total advanced manufacturing workforce.
Nearly one-in-10 working Pennsylvanians report to a manufacturing profession each workday, Esoda said. Each of those workers share in $41 billion in wages paid annually and exceptional benefits packages, which frequently include employee-sponsored retirement plans, healthcare coverage, tuition assistance and generous paid vacations and holidays.
Esoda said NEPIRC published the report as part of its ongoing efforts to support the manufacturing industry, raise awareness of manufacturing careers and keep the manufacturing support programs at the forefront of the minds of legislators and policy makers.
"It's sometimes easy to overlook a cornerstone of our economy that has upheld the Commonwealth for decades in favor of things that seem more trendy or glamorous on the surface but generate only a fraction of the benefits and impact," Esoda said. "Our intention with this report is to ensure that leaders across Pennsylvania recognize the criticality of our manufacturing industry and the value of the programs and entities that contribute to their enhanced competitiveness, resiliency and success in a global economy."
Benefits of IRCs
NEPIRC is one of seven Industrial Resource Centers (IRCs) across Pennsylvania.
According to the report, over the past 10 years, Pennsylvania IRC clients have realized the following benefits by working with their local Center:
—$1.76 billion in top-line growth.
—$5 billion in retention of at-risk sales.
—$846 million in operating cost savings.
—55,477 jobs created and retained.
The IRCs also enabled their clients to invest nearly $2 billion in expansion, modernization and workforce upskilling in Pennsylvania over the past 10 years.