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Business Times - 07 Oct 2009

US still world's biggest manufacturer but China gains: study

WASHINGTON - The United States remains the world's largest manufacturing nation even as China gains ground, according to a new study.

The survey released on Tuesday by the US-based Manufacturing Institute with the Manufacturers Alliance showed that the US share of global manufacturing value has held at 22 per cent in 2008, roughly the same level for nearly 30 years.

China's share last year was 14 per cent, continuing a surge from its 1980 level of just 2 per cent, according to the study using data from the United Nations, International Monetary Fund and other sources.

The US manufacturing generated US$1.64 trillion worth of goods in 2008.

Although the value has been rising, industrial output's share of gross domestic product has fallen from 20 per cent in 1980 to 11.5 per cent in 2008, the report showed.

'A common misconception is making the rounds: that domestic manufacturing is vanishing,' the report stated.

'This misperception is based on consumers' daily observation of foreign-made products visible on store shelves and the media's focus on the loss of jobs in the sector. But the facts do not support this pessimistic view.

'Manufacturing in the United States remains vital and important to the US economy and is globally competitive.'

'The facts clearly illustrate that manufacturing is central to America's economic future,' said Emily Stover DeRocco, president of The Manufacturing Institute.

'The United States has the largest manufacturing economy in the world, producing US$1.6 trillion in goods annually. America's global market share of manufacturing has held steady at around 22 percent for 30 years...And one in six US jobs is in or directly tied to manufacturing, which still pays premium wages and benefits.'

In terms of manufacturing exports, however, the United States is the third largest after the European Union and China, and ahead of fourth place Japan, the report showed.

In terms of global market share of manufactured exports, the US share declined from 19 per cent in 2000 to 14 per cent in 2007, while the Chinese share rose from 7 per cent to 17 per cent, according to the data. -- AFP

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