Why Industrial Manufacturing Is Important To An Economy
by Mike Rourke
By industrial manufacturing is meant the types of industries that mainly deal with production and processing of raw materials, and in most cases, the end product is a new one or it has been added value. The end-product could be used as it is or in the further production of other goods. This type of industry is very critical to an economy, as it produces everyday commodities that people use.
Basically, it can be said that manufacturing industries typically exist to produce goods. As opposed to more artisanal types of goods that are more of craft-making than manufactured types, these kinds of goods are normally produced in factories, usually in mass quantities. It can also be said to include building of roads, as well as facilities which are used for the production and distribution of water and power. Also, it encompasses plastic and electronic manufacturing.
In USA, manufacturing has a long and often convoluted history. In the 19th century when industrial revolution took place, the economy of the country changed from one based on farming to a more industrialized economy. The production was massive, so that what remained was exported to foreign countries. Even the economic boom that was seen shortly after the end of Second World War was attributed to the sector.
To say that manufacturers are significant to an economy is an understatement. This is because the factories employ so many people. This sector is also an important source of wealth to a country. Goods produced as a result of production are exported, earning the country foreign exchange. A trade surplus occurs when a country exports more than it imports.
What this means economically is that the country receives more money than it spends, which is what contributes to the wealth of a nation. During the first half of the last century, the production sector led to America experiencing a trade surplus. The case is not the same today, since the sector has shrunk, which has led to trade deficit.
There are several other benefits derived from production, apart from creation of jobs. For example, a robust sector of production can lead to the development of modern technologies. The New York Business Council states that over 70% of research and development in the private sector is funded by the sector. Separately, the Institute of Economic Policy says that in 2006, this sector contributed to the GDP of America by $1.6 trillion, which represented 12%.
Manufacturers are crucial to all economies. If you take into account the crucial role that manufacturing companies play in creating everyday products, then you will agree that they are indeed the bulwark of the economy. Products like tissue papers, soft drinks, sugar among others, must be produced in mass to cater for more than 400 million citizens of America who use it.
The trend today is that the American economy is depending more on the service sector, because of complicated and complicated the production process is a country that has a strong industrial manufacturing sector cannot have a trade deficit.
This article was written on behalf of <a href="http://originmanufacturing.com/">Origin Manufacturing Ireland</a> who are a plastic and electronics manufacturer based in Ireland.
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New Unique Article!
Title: Why Industrial Manufacturing Is Important To An Economy
Author: Mike Rourke
Email: dave@vroomdigital.ie
Keywords: manufacturing,industry,business
Word Count: 501
Category: Business
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