Manufacturing hiring stalled last year

A worker welds a truck cab frame on the Volvo truck assembly line at the Volvo plant in Dublin, Virginia. Manufacturing hiring was nearly flat in the United States in 2015, though it ended the year with a strong December.

After decades of retrenchment, the American manufacturing industry has been adding jobs again, but hiring slowed to a glacial pace in 2015, which was the worst year for manufacturing hiring since the Great Recession.

Factories added 8,000 jobs in December, according to the U.S. Department of Labor. Manufacturing however gained only 30,000 jobs over the course of the year.

The Alliance for American Manufacturing, a non-partisan partnership between the United Steelworkers Union and some of America's largest manufacturers, blames massive overcapacity in China and unfavorable trade policies.

"While the rest of the economy added more than 2.5 million jobs in 2015, manufacturing hiring was virtually flat. And you can see the ripple effect of Chinese economic policy in our own factories," AAM President Scott Paul said.

More than 12,000 steelworkers were laid off in 2015, Paul said. And with China's currency devaluing, and its industrial overcapacity spreading pain around the globe, more bad news for American manufacturing may be coming, he said.

A dearth of new manufacturing jobs has been a significant problem in the Calumet Region, where the economy has historically depended upon heavy industry such as steelmaking, automaking and oil refining.

Northwest Indiana has only recovered about three-fourths of the jobs lost in the Great Recession but it hasn't been regaining good manufacturing jobs that pay $25 to $30 per hour, Indiana University Northwest Northwest Assistant Professor of Economics Micah Pollak said. Instead, newly created jobs pay $10 to $15 an hour and have fewer benefits, which drags down the overall economy.

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The AAM is encouraging president Barack Obama to make good on his promise to create 1 million new manufacturing jobs during his second term. So far, the Alliance says the United States has added 384,000 jobs in the sector and Obama will fall short of his goal of 1 million new jobs in manufacturing unless the country adds a 51,333 more a month.

"While the president was right to highlight economic progress, he missed an opportunity to address some of the core concerns that are holding back manufacturing," Paul said.

Manufacturing has added nearly 900,000 jobs over the past six years, but that represents less than 40 percent of the factory jobs lost over the recession, Paul said. Only 30,000 jobs were created in 2015.

The rescue of the automotive industry and manufacturing hubs such as the Digital Manufacturing and Design Innovation Institute in Chicago's Goose Island neighborhood aren't enough to bolster the flagging sector, Paul said. 

Trade deals should be structured to protect American industry and jobs, he said.

"Manufacturing is struggling right now, primarily due to a surging imbalance in the manufacturing goods trade, particularly with China," Paul said. "Layoffs are already occurring in steel and other industries, and those jobs are very difficult to reclaim."


Business Reporter

Joseph S. Pete is a Lisagor Award-winning business reporter who covers steel, industry, unions, the ports, retail, banking and more. The Indiana University grad has been with The Times since 2013 and blogs about craft beer, culture and the military.