PPI report shows NYS manufacturing is growing after long decline


Director of Communications

New York State's manufacturing sector "is making a comeback," a new report by The Public Policy Institute says.

The report, The State of Manufacturing in New York State, shows that manufacturing employment statewide grew slightly in 1997, the first annual increase in more than a decade. For five straight years earlier in the decade, the state lost more than 40,000 factory jobs each year.

"The resurgence of our manufacturing base is broad-based," says the report by the Institute, the research affiliate of The Business Council. "Upstate and downstate are sharing equally in the resurgence."

The report noted that "the change in the Empire State was not simply a reflection of a stronger national economy"; rather, the state's share of nationwide growth in manufacturing employment has improved.

New data from the U.S. Census Bureau show that manufacturers have set the stage for continued growth, according to the report. New capital investment in industrial facilities in New York jumped 33 percent in 1995-96, compared to the two previous years, to a total of more than $10 billion.

Only six other states reported greater levels of capital investment.

Still, after years of sharp decline, the state's manufacturing sector has not completely turned around, the report says. New York continues to lag the nation in growth of both factory jobs and investment.

Contrary to popular belief, wages for production workers are not out of line in New York; in fact, they are, on average, 2 percent lower than the national average, the report shows.

Overall manufacturing wages are higher, on average, than in most other states. But that's because the Empire State has a greater proportion of its manufacturing employment in research and development, corporate headquarters and other non-production positions that typically have higher salaries than production positions.

"We've proven that we can grab a larger piece of the national manufacturing pie," the report says. "We've done that by becoming more competitive."

Taxes are lower, workers' compensation premiums are down (see story, front page), and a traditionally hostile regulatory climate is much better, the report says.

The state should continue to improve its climate for manufacturing by improving job training, reforming the liability system, and continuing to cut the cost of doing business, the report says.