According to the Federal Reserve, manufacturing production increased 0.3 percent in October, rising for the fifth straight month to the highest level since June 2008.
The index for manufacturing activity rose from 105.1 in September to 105.4 in October. The accompanying chart illustrates just how much the sector has come back since the Great Recession, with a notable acceleration in the past few years. Manufacturers are experiencing phenomenal growth in 2018, for instance, with the sector seeing output up 2.7 percent over the past 12 months.
Other indicators have also reflected this strength, including the National Association of Manufacturers’ outlook survey, which continues to reflect optimism readings at historic highs. Pro-growth policies, including tax reform and a changed regulatory environment, have helped to make manufacturing one of the bright spots in the economy. In addition, manufacturing capacity utilization inched up from 76.1 percent in September to 76.2 percent in October, the best rate since July 2015.
There’s of course more work to do to guarantee this growth continues. A growing gap between the number of manufacturing job openings and the number of skilled workers to fill them could derail much of the success we’ve seen the past few years. Uncertainty around trade and exports could dampen further growth.
It’s clear, however, that the U.S. manufacturing industry is running full-steam ahead, and smart policy decisions are putting the industry on the right track.