The United States ranks near the top for overall manufacturing environment in a new Brookings Institution report that evaluated nations on the basis of policies and regulations, taxes, costs, workforce quality and infrastructure and innovation.
The U.S. ranked third, edged out by the United Kingdom (#2) and Switzerland (#1) in Brookings’ 2018 Global Manufacturing Scorecard, released on Wednesday.
The survey took the long view, using data from 2011 to 2015 and comparing it to years prior. In addition to the above categories, it also analyzed data on manufacturing output, manufacturing employment, and changes over time.
China ranked #1 in manufacturing output (U.S. #2), while Poland had the largest percentage of its workforce, 20.2%, employed in manufacturing (U.S. #16, 10.5%).
In developed countries, the study found, manufacturing overall dropped from employing 16.8% of the workforce in 1970, to 12.8% in 2011.
During that period, East Asia (including China and South Korea), Southeast Asia, and India, increased their manufacturing employment as a percentage of the workforce.
The high corporate tax rate, the lack of availability of government grants/loans and the high costs of healthcare kept the U.S. out of the top spot.
American manufacturing drives 35 percent of productivity growth, 60 percent of exports, and 70 percent of private sector R&D nationwide, the study found. Manufacturers contribute $2.17 trillion to the United States economy, which is nearly 12.1 percent of the U.S. GDP.
“Moreover, the gap in labor costs found in the United States in comparison to other countries has started to drop and likely will continue to drop as the cost of industrial robots falls,” the study authors stated, with additive manufacturing, advanced robotics, the Internet of Things and Big Data driving this.
The study also credited the National Network for Manufacturing Innovation (NNMI) and National Institute of Standards and Technology (NIST) grants for driving advanced technology innovation.