The Census Bureau reported yesterday on fourth quarter financial results for the U.S. manufacturing sector, with the following highlights:
1. After-tax profits for U.S. manufacturing corporations were just short of $600 billion in 2011, setting a new annual record. The $598.3 billion of profits for American manufacturers last year represented an increase of more than 25% from the $477.7 billion in profits the previous year, and follow a 67% gain in 2010. In contrast, the after-tax profits for all U.S. corporations are on track to increase by less than 5% for 2011 based on data currently available through the third quarter of last year, following a 19% increase in 2010.
2. The $600 billion in after-tax manufacturing profits is also more than 27% above the pre-recession high of $470.2 billion 2006, and more than double the annual profits in 2008 and 2009 of less than $300 in each of those years. In contrast, all corporate profits this year will be less than 10 percent higher than in 2006.
3. On a quarterly basis, durable manufacturing had its most profitable quarter ever, with a record-setting $76.5 billion in profits for the October-December period.
The record profitability of U.S. manufacturing corporations last year is just one of several economic indicators that put America's industrial sector directly at the forefront of the economic recovery. For example:
1. While real GDP increased only 1.7% last year, the manufacturing component of U.S. industrial production grew at almost three times that rate (4.7%) in 2011, and increased by a even-higher 5.2% over the most recent 12-month period from February 2011 to February 2012.
2. Over the 12-month period from February 2011 to February 2012, manufacturing employment grew by 1.90%, compared to the 1.5% growth rate for total payroll employment over that same period.
3. For the last nine months from June 2011 to February 2012, the jobless rate for manufacturing has been below the national average, and is currently at 7.7% and a full half-point below the U.S. average of 8.2% (not seasonally adjusted).
By all relevant measures of economic performance: profits, output gains, employment growth, and unemployment rates, American manufacturing continues to lead the U.S. economy in the economic recovery.