Food & Beverage Lauded as Leading Contributors to Manufacturing Growth, Says Federal Reserve Report
The food & beverage industry was lauded as the leading contributor to growth in manufacturing establishments jobs growth in the previous 10 years, according to “The Sluggish Renaissance of U.S. Manufacturing,” a report from the Federal Reserve Bank of St. Louis.
“The food manufacturing industry drove 19% of the increase in the number of manufacturing establishments and 49% of the rise in manufacturing employment over the past decade,” said the report, just released Aug. 12. “Beverage and tobacco product manufacturing,” which the Bureau of Labor Statistics combines, also was a key contributor, accounting for (our approximation from the chart below) 16% of new plants and nearly 20% of new jobs.”
About half of the manufacturing sector’s increase in employment over the past 10 years was driven by the food manufacturing subindustry. That subindustry also contributed the most to the increase in manufacturing establishments during this period.
“Geopolitical tensions have spurred a revival of U.S. manufacturing, an argument in favor of reshoring manufacturing jobs,” the report begins. “At the end of 2024, about 12.6 million people were employed in the manufacturing sector. This represents about 9.3% of total private sector employment.”
While those numbers are considerable, the report notes manufacturing was once a leading source of jobs, averaging 33.7% of employment in 1960 and 19.4% in 1990. “Employment in the sector has declined over the past decades as the economy has shifted toward service industries." And automation - that comes up later in the report.
“Although not enough to reverse this downward trend, the number of manufacturing employees has been slowly recovering over the past decade (barring the COVID-19 pandemic dip), fluctuating at above 12 million people.”
In the negative numbers are older manufacturing categories, notably printing, apparel and textiles. Similarly old categories that eked out tiny gains in plants but not employment included primary metals, furniture and paper production.
The report used data from the U.S. Bureau of Labor Statistics’ Quarterly Census of Employment and Wages, which covers more than 95% of U.S. employment.
A graphic using data from 1990-2024 shows the number of manufacturing establishments and number of jobs closely tracking each other until 2020. Since then, the number of plants has shot up but employment has flattened.
The report explains: “Although the average number of employees per manufacturing establishment has been falling steadily over the past decades as the adoption of automation has become more prevalent, a manufacturing establishment still employed an average of 32 workers in 2024. That is considerably higher than for other industries. For instance, an establishment in the retail industry employed an average of 15 workers in 2024, while an establishment in the real estate and rental and leasing industry employed fewer than five.”
The states with the largest shares of manufacturing workers were California, Texas, Ohio, Illinois, Michigan and Pennsylvania. For instance, California employed 10.4% of all manufacturing workers in the U.S., while Texas had 7.3% of manufacturing workers.
About the Author
Dave Fusaro
Editor in Chief
Dave Fusaro has served as editor in chief of Food Processing magazine since 2003. Dave has 30 years experience in food & beverage industry journalism and has won several national ASBPE writing awards for his Food Processing stories. Dave has been interviewed on CNN, quoted in national newspapers and he authored a 200-page market research report on the milk industry. Formerly an award-winning newspaper reporter who specialized in business writing, he holds a BA in journalism from Marquette University. Prior to joining Food Processing, Dave was Editor-In-Chief of Dairy Foods and was Managing Editor of Prepared Foods.