Plastics industry outlook remains positive despite ‘temporary setbacks'

The number of people employed by the U.S. plastics industry and the value of products made by the industry both saw small declines in 2023.

The 2023 value of shipments came in at $519.1 billion, down 3.5 percent vs. 2022, according to Perc Pineda, chief economist with the Plastics Industry Association in Washington. Pineda spoke Sept. 19 during a webinar for the release of the association's annual Size & Impact Report.

Shipment values had grown in both 2021 and 2022 after showing a slight decline in 2020.

"There may be temporary setbacks, but the long-term outlook remains positive," Pineda said.

The number of people working in the U.S. plastics industry declined 1.6 percent, but remained just over 1 million in 2023. The 2022 total was up about 2 percent vs. 2021. The industry also continued its long-term growth average of almost 1 percent in real value added from 1997-2023, even as overall U.S. manufacturing was flat in that category.

In a news release, association President and CEO Matt Seaholm said the report "shows the plastics industry remains vital to our economy as a job creator and a source of innovation" and that the industry "will continue to grow as part of the circular economy, finding innovative ways to make plastic better and more sustainable." He added during the webinar that plastics "are used in every basic manufacturing process."

Seaholm also said that the association's members' investment in new recycling capacity "is substantial," but that "for the plastics industry to have a sustainable business model, circularity has to improve."

Among individual states, Texas led the way with 77,400 plastics jobs, ahead of Ohio at 74,300 and California at 72,300. Those were followed by Michigan (64,600) and Illinois (52,200). The next five states on the plastics jobs list were Pennsylvania, Indiana, Wisconsin, North Carolina and Georgia.

Based on population density, Indiana led the country with 15.2 plastics jobs per 1,000 nonfarm jobs, followed by Michigan at 14.5 and Wisconsin at 14.2.

California and Michigan each ranked first in two specific plastics jobs categories. California is home to 11.3 percent of plastics wholesale trade jobs and 8.3 percent of captive plastic production. Michigan has 19.9 percent of mold making jobs and 12.9 percent of plastics machinery jobs.

In other job categories, Ohio had 7.9 percent of plastic product jobs and Texas had 21.1 percent of materials and resins jobs.

Pineda cited data showing that almost 90 percent of U.S. plastics production is for personal use as proof that the industry "has social benefit."

"The industry hasn't oversupplied the market by any means," he said. "It's been very responsible in providing plastics production to efficiently meet the needs of the market."

The Federal Reserve's recent decision to lower U.S. interest rates by half a percentage point also should benefit the plastics industry in several ways, Pineda added, including by boosting construction activity.

"This [interest rate] cut was appropriate for a less robust but still expanding economic outlook," he said. "A larger cut would have indicated a contraction, while a smaller cut wouldn't have made much impact."

"There's a growing belief in a soft landing [for the U.S. economy], which should restore vibrancy to the plastics industry."