August 15, 2022

Economix: The Factory Age Isn’t Over

Mira Oberman/Agence France-Presse — Getty Images

The number of factories in the United States employing more than 1,000 workers fell by one-third from 1997 to 2007, leaving 1,014 such factories. This probably will not surprise you. The shattered windows of empty factories have become a familiar sight.

But a new study from the Federal Reserve Bank of Minneapolis puts an interesting twist on this familiar narrative. It reports that most of those factories did not close. They simply employ less people.

Of the factories that fell from the list of large employers, the study found that 48 percent still employed more than 500 people. Another 7 percent employed from 250 to 500 people. The remainder either had closed or employed fewer than 250 people.

The numbers predate the recession, making it likely that more of those factories have since closed or shed workers. But particularly at this moment, as millions of Americans struggle to find work, the study offers a reminder that our manufacturing base is to some extent a victim of its own success. In 1950, the United States Steel Corporation employed 30,000 workers at its plant in Gary, Ind. Today that factory employs only 5,000 workers. But they produce more steel: 7.5 million tons a year now, compared with 6 million tons then.

The study also includes an interesting list of new super factories, plants that employ at least 2,500 people. There were only 15 such factories. Four of them were built to make light trucks. Three were built to kill chickens. One makes guided missiles.

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