Here is updated data from the UN on manufacturing output by country. China continues to grow amazingly moving into second place for 2006. I plan to write more on this data in the Curious Cat Investing and Economics Blog. UN Data, in billions of current US dollars:
| Country |
1990 |
2000 |
2004 |
2005 |
2006 |
| USA |
1,040 |
1,543 |
1,545 |
1,629 |
1,725 |
| China |
143 |
484 |
788 |
939 |
1096 |
| Japan |
808 |
1,033 |
962 |
954 |
929 |
| Germany |
437 |
392 |
559 |
584 |
620 |
| Italy |
240 |
206 |
295 |
291 |
313 |
| United Kingdom |
207 |
230 |
283 |
283 |
308 |
| France |
223 |
190 |
256 |
253 |
275 |
| Brazil |
117 |
120 |
130 |
172 |
231 |
| Korea |
65 |
134 |
173 |
199 |
216 |
| Canada |
92 |
129 |
165 |
188 |
213 |
| Additional countries of interest - not the next largest |
| Mexico
| 50 |
107 |
111 |
122 |
136 |
| India |
50 |
67 |
100 |
118 |
130 |
| Indonesia |
29 |
46 |
72 |
79 |
103 |
| Turkey |
33 |
38 |
75 |
92 |
100 |
The UN provided data separating out manufacturing from mining and utilities so the data above is just for manufacturing as was the manufacturing data for 2005 (two years included all 3 categories together, see: Global Manufacturing Data by Country. The tables includes the top 10 countries and some additional countries. This data cannot be seen as perfectly accurate. There is a fair amount of error within the data (and you will notice some of the data fluctuates when you look back at previous posts for output for years in the past), still it provides a useful view of global manufacturing activity.
Related: Manufacturing Value Added Economic Data by Country - Worldwide manufacturing job data - Manufacturing Data: What Does it Mean - articles on lean manufacturing - Manufacturing Jobs - Curious Cat Economics Search Engine
January 20th, 2008 at 6:56 pm
Curiouscat,
Its nice to see you’ve been reading as well. I believe that you’ve said the right thing. Cheap labor is not everything, but it is nevertheless an important factor in bringing costs down while keeping quality the same or more. It is a very interesting game that’s going on and I’ll try to reason why this is so :
1. China is state run and quite pro business. There seems to be a planned way to development.
2. China’s infrastructure is very developed compared to other countries in the south Asian belt.
3. China opened its doors to FDI way before other countries (late 70’s), now there are quite experienced suppliers in the country who understand how businesses in U.S are run, they understand ISO standards etc. (Thats being moot as we’re understanding that some bad products are made in China as well)
4. China is a far more attractive than India perhaps for manufacturing because India is more geared towards the IT services industry. It is said that India’s consumption of aluminum is about two pounds per person, compared with nine pounds per person in China.
5. The foreign investment pouring into China is far more than other countries, where red tape-ism has been getting in the way in the private sector.
You’re right in saying that labor costs are not everything. That is all set to change as I hear that wages, especially in the rural areas of China, are steadily increasing.
I think in high wage countries, Toyota, while not particularly interested in lower wages, has an excellent production system and that keeps costs to a minimum. They have gone outside Japan and duplicated their manufacturing plants and their production ideas exactly. Theirs has been a model to follow for auto makers in the U.S.
I think China will exceed manufacturing in the U.S. The data you have provided is two years old.
Think about it.
1. China has the most number of people. Its amazing when you think of the number.
Chinese people are developing fast and are demanding more of everything, cars, computers, tvs, what not.
2. Steady oil cost increases for the U.S will ultimately slow down manufacturing unless they can get that oil cheaper, reduce transportation costs and what not from the supply chain.
It’ll be interesting to see what happens in the next couple of years.
Ron
Cozy Beehive
January 20th, 2008 at 8:39 pm
Not really 2 years old, the data for the calendar year 2006 is approaching 13 months old. The way people have been talking about the “death of US manufacturing” for at least 10 years getting a clear picture of the actual state of affairs is important. I would be surprised if the trends change much in the next couple of years. China continues to grow rapidly. Manufacturing in the USA also continues to grow. The USA stays the largest manufacturing country.
It is harder to tell where things will stand 10 years from now. I would guess the USA would still be the largest though it is possible it will be 2nd. It is not really possible it will be less than 2nd. I would be surprised if the USA wasn’t manufacturing more then than it is today. I would be surprised if we didn’t have fewer workers in manufacturing. I would be amazed if productivity were not substantially higher (so that if we did not have fewer workers in manufacturing then our manufacturing output would be significantly above current levels).
January 22nd, 2008 at 12:18 am
John,
The temptation to rank x or y is great. We all want to know how our countries are doing.
But I just want to sum this up and this is a fact. No matter what other techniques you bring about to increase production and productivity, the lifline of both the U.S and China is oil. Both of these nations produce very little. How these two giants go about in the world capturing black gold to feed their millions is the vital key to being top manufacturer, top everything…