Study: Rhode Island leads the US in manufacturing job losses
March 20th, 2012 at 6:00 am by Ted Nesi under Nesi's Notes, On the Main Site
It’s no secret the United States has hemorrhaged manufacturing jobs over the past decade. But some states were hit harder than others – and Rhode Island was hit hardest of all.
Manufacturing companies in Rhode Island cut more workers than their counterparts in any other state from 2001 to 2011, according to a Wall Street Journal analysis of Moody’s Analytics data.
Rhode Island lost 37.1% of its manufacturing jobs over those 10 years, as the industry’s total labor force dropped from 64,500 workers in 2001 to 40,600 in 2011. The next-biggest declines were in North Carolina (34.9%), Michigan (34.7%) and New Jersey (34.2%).
Other New England states lost a smaller but still sizable number of manufacturing jobs from 2001 to 2011, with declines ranging from 30.1% in Massachusetts to 24.6% in Connecticut. The only state where manufacturing work grew was tiny North Dakota, which eked out a 2.5% increase by adding 600 jobs.
“Companies are concentrating many of their manufacturing investments in states where unions are weak and wages are relatively low,” and they’re also “shopping for lower taxes and regulatory costs,” the WSJ reported. More than 17% of Rhode Island workers belonged to a union in 2011, above the 12% national average.
Rhode Island was an industrial powerhouse in the early 1900s, with factories churning out textile, metal and machine products, but that changed in the years after World War II. Manufacturing’s share of the state economy fell from 29% in 1963 to 16% in 1997, according to the R.I. Economic Development Corporation. It was down to 10% in 2006 under a new measuring system.
Part of the state’s struggle over the last decade may be due to rising competition from abroad. Workers in Rhode Island and Bristol County, Mass., faced more risk from China’s economic rise than their peers anywhere else in the country except San Jose, Calif., according to an academic study reported by WPRI.com last fall.
The EDC classifies more than 2,900 Rhode Island companies as manufacturers, and improved productivity has allowed them to produce more goods with fewer employees in recent years. Even as Rhode Island’s total manufacturing work force plunged by nearly half from 1997 to 2010, the sector’s total output increased.
Update: A group of economists, including former EDC Economic Policy Council chief Rob Atkinson, is preparing to release a report arguing that the U.S. manufacturing sector is actually doing significantly worse than commonly thought:
What caused the job losses, in their view, is less the efficiency of U.S. factories than the failure of those factories to hold their own amid global competition and rising imports. The apparent productivity gains reflected in the official U.S. statistics have been miscalculated and misrepresented, they say, a position that has been at least partially validated by recent research. …
For starters, the reported productivity gains may be overstated because the statistics the government collects do not adequately reflect the changes that have come with globalization ….
But there may be another, broader problem with the manufacturing output and productivity figures.
Those numbers lump all manufacturing together when there are actually two very different trends afoot.
• Related: Why Apple doesn’t manufacture iPhones in Rhode Island (Jan. 22)
Tags: economy, employment, jobs, manufacturing, unemployment, work force
Nesi's Notes covers politics and the economy in and around Rhode Island for WPRI.com. (Twitter: 
One wonders if the Wall Street Journal once wrote about the competitive merits of states that allowed slavery?
Jake, No business will expand in Rhode Island because of the anti business regulations, lack of a trained or ethical workforce. The people of Rhode Island have a sense of entitlement. Other states don’t tax business or residents to death to support a class of government employees that are overcompensated and are not expected to meet the standards, expected that of government employees in the rest of the country. They allow people who worked hard, created wealth to be able to pass it on to their heirs. You probably believe $800K is a large estate. That is poverty in the rest of the country.
Don Carcieri, so successful. keep cutting those taxes, attacking those unions….it’s a proven winner…NOT!
Fish when you speak about unions you better be able to differate between public and private sector unions. Public sector unions are what is killing Rhode Island.
Exactly! It’s the fed & state worker’s unions that are destroying RI. They are causing cities to crumble, like EP and Woonsocket, for, the teachers in those cities are very, very overpaid and will not budge to assist the communities they are making money off of.
Unions at shops and the such in private sector doesn’t affect things like they do in regards to govt worker unions.
Don Carcieri did his best many times to try to lay off workers and work with the Unions. They were stubborn and was as if they tied that Govt. down with chains.
So now, our state is out of money. All the pubic sector unions want to do is raise taxes, raise taxes, raise taxes. Well, idiots, you can’t get blood from a store–Or money from poeple that have been out of work for so long, they have exhausted their unemployment benefits.
Thank your local teachers, firefighters and cops for bringing our state and cities down.
“Don Carcieri did his best many times to try to lay off workers and work with the Unions.”
I’ve seen some revisionist history before, but that line just takes the cake……
Have no fear… the answer is just around the corner. The “mislabeled gambling ‘industry’”, is touted by what passes for leadership in Rhode Island. This is the same collection of folks who’ve doubled down to make the state a leader in high cost energy, public sector spending, taxes, regulations,etc. I have every confidence that they’ll continue Rhode Island’s drive to the bottom and competition with the likes of banana republics. Meanwhile, those with any sense and go getting will invest in moving vans.
I concur!!
Yeah, gambling in a state where no one has jobs. That will solve the problem. How many times has Twin River almost lost their shirts?
Rhode Island leads the country again whooooo-hooooo!! Hey, might as well cheer about it, it’s the best we can do.
Hi Cosmo, if we don’t laugh we will cry.
I’m wondering if our leaders have ever looked at the top 10 states that lost the fewest jobs, and asked: What are they doing that we aren’t?”
That sounds like a simple question, but you won’t find any reports up at the state house that succinctly point out our flaws one by one simply because our leadership works on the business principal: I’ll be gone by the time the damage hits!
We’ve a small manufacturing business in East Providence. We’ve 70 folks and have been in EP for 49 years and have never been late on a payment to the City. This year our tax payments will be $96,000 and over the last seven years the compounded increase per year has averaged 3.7%. In the theater-of-the-absurd category, EP recently passed an ordinance requiring a business registration fee, $25.00 “to do business in the City of East Providence.” Of course, I have to submit a notarized affidavit and if I’m late, every day late is an additional $25.00. Why is the City doing this? Because it can. For sure, if we did this to a 49 year customer, they say good-bye before an explanation was completed. The $25 is a metaphor for government looking after itself and speaks elegantly to the continued behaviors that got the City on the verge of failure in the first place.
John, can you say extortion? Have you looked at space across the border? It may cost to move to Mass but in how many years will you make up the savings? Just a thought!
I have veray Blogs It’s no secret the United States has hemorrhaged manufacturing jobs over the past decade. But some states were hit harder than others – and Rhode Island was hit hardest of all.
San Jose Moving Companies
THE DEMOCRATS ARE DESTROYING RHODE ISLAND! 70 years of failed policies and control of the General Assembly! They need to go in November.
sorry to tell you, guy, the independent (undercover republican)is in office and i aint seeing no change.
manufacturing is lost due to cheap labor overseas
I have veray blogs Workers in Rhode Island and Bristol County, Mass., faced more risk from China’s economic rise than their peers anywhere else in the country except
San Jose Moving Services
Hemmings Auto Blog came across this auction for a very rare 1961 Corvette, which came with not one, but two rare option packages. First there’s the heavy duty brake and suspension package, known as RPO 687, of which only 233 cars were built. And there was an even rarer package, RPO 1625, which replaced the standard 16 gallon fuel tank with a much bigger one for racing duties.