The U.S. manufacturing industry — including plastics — continues to work its way out of the recession.
Of the 41,000 new jobs created in the U.S. in May, 29,000 came from manufacturing. That increase helped the national unemployment rate fall from 9.9 percent to 9.7 percent.
“We've had five strong months of job growth and three strong quarters of [gross domestic product] growth,” Bill Carteaux said at the recent Resin Technology Inc. Executive Forum in Fort Worth. Carteaux is president and CEO of the Society of the Plastics Industry Inc., a Washington trade group.
Recent trends have allowed Carteaux to justify his optimism. In the last three quarters, 43 percent of U.S. job growth has come from manufacturing. “Those type of numbers really bode well for the U.S. right now,” Carteaux said. “There's a broad-based recovery of manufacturing.”
But there's still work to be done. Manufacturing's share of U.S. GDP fell from 15 percent in 1998 to 11 percent last year. In 1970, manufacturing's GDP share was more than 30 percent.
“We have to get that number back to a level that's respectable for a developed country like the U.S.,” Carteaux said.
Plastics will play a big role in the U.S. recovery, since the sector ranks as the country's third-largest manufacturing sector, with annual shipments valued at almost $400 billion. In the U.S., plastics firms employ 1.1 million at more than 17,000 locations. Almost 90 percent of those jobs are in processing. Plastics firms also spent more than $10 billion on capital expenditures last year.
Production of plastic parts in the U.S. also is increasing, he said. After peaking in 2007, that number had dropped to levels not seen since the mid-1990s. But capacity utilization for March was at 74 percent, after being under 70 percent during 2008.
U.S. sales of injection presses took a big jump in April, climbing more than 90 percent when compared with the 2009 period. But the machinery sector still has a long road to recovery. Overall machinery sales were above $250 million per quarter in 2005, but have been under $150 million since the first quarter of 2009.
Resin exports continue to allow the U.S. plastics industry to be a net exporter. The U.S. remains a net importer of molds, machines and products. But the negative trade balance on plastic products isn't expected to last, Carteaux said, since that sector “has hit bottom and is going back up.”
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