March 6, 2013
CMAP's latest cluster drill-down report shows how, even in an era of increasing globalization, manufacturing continues to play a central role in metropolitan Chicago's economy. While manufacturing employment did contract by a third during the past decade due to offshoring and automation, productivity continues to increase -- between 2001 and 2011, the region's productivity per manufacturing worker increased by 60 percent in inflation-adjusted dollars. And with over 580,000 jobs, the Chicago region has more manufacturing cluster workers than all but one region in the U.S., belying the conception that the region's manufacturing heyday is in the past.
Looking forward, the region has a real opportunity to not only continue productivity increases, but also reverse job loss. Recent data is encouraging -- the region has added between 15,000 and 25,000 manufacturing jobs over the last two years. To build off this manufacturing momentum, CMAP's cluster report argues that the region must embrace the type of "advanced manufacturing" that best capitalizes on regional strengths.
While many sources have raised the importance of advanced manufacturing, few have defined or measured exactly what this advanced manufacturing entails. CMAP has developed a "3P approach" -- Product, Process, and People -- to define the characteristics of advanced manufacturing.
Product: Advanced manufacturing products are complex, innovative, and difficult to replicate.
Process: Advanced manufacturing processes (regardless of end product) are continually improved to achieve new efficiencies and cost savings.
People: Advanced manufacturing workers have specialized skills that maximize the commercial impact of the products and processes.
Using these 3P indicators, CMAP has created an advanced manufacturing scorecard. The scorecard uses a hybrid of indicators to measures these aspects of advanced manufacturing. An interactive version of the scorecard and related occupational analysis is available at www.cmap.illinois.gov/policy/drill-downs/manufacturing.
Advanced Manufacturing Scorecard: Regional Implications
The scorecard shows how different industries reflect each of the 3Ps of advanced manufacturing. For metropolitan Chicago to build off of recent manufacturing momentum, it can leverage those top-rated scorecard industries where the region maintains strong specializations. These include Pharma/Medical Supply; Chemicals, Plastics, Rubber; and Fabricated Metals. In terms of the Machinery industry, the region manufactures less in automotive and aerospace, but remains a leader in electrical and industrial equipment. Finally, while the Computers/Electronics industry scores high on advanced manufacturing indicators, the Chicago region is much less specialized compared to competitors such as Silicon Valley, so that industry may not be as primed for growth compared to the others.
Future Policy Updates blogs will explore how metropolitan Chicago can support future its specializations in advanced manufacturing by focusing on economic innovation, infrastructure assets, and developing its deep pool of skilled workers.