Reversing the trend of the previous decade, Detroit has added more manufacturing jobs in the last two years than all but one other metropolitan area in the country.
A report released Wednesday from the think tank Brookings Institution, "Locating American Manufacturing: Trends in the Geography of Production," ranked 100 major metropolitan areas' manufacturing jobs growth from January 2010 through 2011. The Detroit metro area came in at number two, with a 12.09 percent increase, following Charleston, SC with 14.4 percent.
It's a big change from 2000 to 2010, when cities across the country lost manufacturing jobs, and the job growth in the South slowed. During that time, Detroit lost 52.1 percent of its manufacturing jobs, compared to the nationwide average of a 33.2 percent loss. But now, the report's authors say, the Midwest is seeing job growth in this area at a rate more than double the South.
Not surprisingly, the report lists Detroit's manufacturing specialties as transportation and machinery. While the auto industry's struggles drastically impacted jobs in the area, in the last two years Michigan industry created 34,000 new jobs.
The Brookings report's authors say companies are more productive when they cluster in locations around specializations, but since the 1980s, manufacturing has become more decentralized as companies moved of metropolitan areas in search of paying lower wages. So what's the reason for the shift back to Detroit?
According to the Detroit News, union workers' concessions with the Big Three in recent years lowered wages to the point where manufacturing employers would return. However, the authors claim the findings show regions can't solely attract companies with low labor costs. They argue that federal policy needs to be enacted to encourage clustering, including supporting research and development and assisting supply chain improvement. There's also the question regarding how much of the increase is a temporary jump after the lows of the recession, and how much is long-term.
Detroit ranks sixth in total number of manufacturing jobs, with 187,821 in 2010, comprising 10.7 percent of the metro area's jobs. It ranks 25 for payscale, with an average rate of $67,804, compared to the area's average for all jobs of $50,266.