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The manufacturing value chain is bigger than we thoughtPosted by Gino DiCaro, VP, Communications on March 24, 2016
Manufactured goods are ubiquitous for our ultra consumer society but the narrow definition of manufacturing industries in national statistics often has the industry accounting for only 11 percent of gross domestic product (GDP) and about nine percent of full-time employment. Those numbers are only the tip of the iceberg though. A recent study by the economic think tank MAPI shows much larger impacts from downstream and upstream activities related to manufacturing that include research and development, corporate management, logistics operations, marketing, and others.
All manufacturing plant activities lie at a hub of a large and complex value chain that is composed of an upstream supply chain that gathers materials and services and a downstream sales chain that moves goods to market and sells and services goods. Manufactured goods are also intermediate inputs in non-manufacturing industries’ supply chains.
The MAPI Foundation's report "The Manufacturing Value Chain is Much Bigger than You Think" accounted for all of these economic activities. Their results showed that the industry is actually responsible for 33 percent of our country's GDP, basically triple what is traditionally reported. This and other findings eclipse even our own numbers here at CMTA. More reasons for California policymakers to always account for manufacturing impacts in new legislation.
Below are a few of MAPI's key additional findings:
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