 by Steven Koczak, PhD, Research Specialist
There’s little doubt that manufacturing once formed the backbone of the American and New York State economies. In the 1950s, cities like Buffalo, Syracuse, and Rochester were considered major manufacturing centers. In the 1960s, a federally funded attempt to forecast unemployment statistics relied heavily on factory orders as one of its main inputs. Where factories went, the economy would follow.
Since then, manufacturing has declined in both New York and across the U.S. Economists have viewed this transition as difficult, but necessary to accommodate economic change. The impact on workers and area economies can be summed up by the term “rust belt.” Rust Belt Magazine says this phrase was coined during the middle 1980s to describe former manufacturing centers after the factories closed. “Rust” was used to imply the decay of both industrial machinery and the social fabric of the surrounding areas.
Rust
Exactly why and when American manufacturing started to decline is subject to debate. Labor economists typically cite automation, globalization, offshore outsourcing, productivity growth and the shift in consumer preferences toward services as the main culprits behind the decline in America’s factory sector.
A report from the U.S. Bureau of Labor Statistics found U.S. manufacturing employment reached an all-time peak of almost 19.7 million in June 1979. As a share of total employment, however, manufacturing peaked in 1943 at approximately 38% of total employment. New York State’s manufacturing employment also peaked in 1943, in both absolute and percentage terms — 2.2 million and 42% of total employment, respectively.
Sociologist Daniel Bell’s 1976 book The Coming Post-Industrial Society forecasted what society might look like when production of goods was no longer the center of the economy. Since then, the decline has continued, despite efforts to mitigate, reverse or slow the trend.
Annual data from the Quarterly Census of Employment and Wages (QCEW) illustrate the decline of New York State’s factory sector this century. In 2000-24, manufacturing employment fell by nearly 45% and the number of manufacturing establishments fell by over 27%. Over this period, manufacturing employment only increased in five years. Two of these annual increases occurred immediately following the COVID-19 pandemic (i.e., 2021 and 2022), likely reflecting post-pandemic re-employment. Despite its long-term decline, the manufacturing sector remains a key component of the Empire State’s economy.
Manufacturing Across NYS
In 2024, manufacturing accounted for just over 411,000 jobs in New York, or 5.0% of the state’s private sector total, per the QCEW. However, the statewide average masks wide regional variations that exist across the state. At the low end, manufacturing is responsible for only 1.3% of private sector jobs in New York City and 1.0% in Hamilton County, which sits entirely within the Adirondack Park. In contrast, there are 11 Upstate counties where manufacturing accounts for at least 20% of private sector jobs, including five counties where this figure exceeds 25% — Chenango (40.3%), Tioga (35.9%), Delaware (29.5%), Lewis (25.5%) and Wayne (25.1%).
Manufacturing Subsectors in NYS
Employment dropped in about three-quarters of New York State’s manufacturing subsectors (3-digit NAICS industries) between 2010 and 2024. In contrast, the five manufacturing subsectors that saw their job count rise over this period include:
- Food Products (+11,670)
- Beverage and Tobacco Products (+7,340)
- Electrical Equipment and Appliances (+770)
- Wood Products (+380)
- Nonmetallic Mineral Products (+140)
As of 2024, the five manufacturing subsectors with the most employment in New York State were:
- Food Products (60,730)
- Computer and Electronic Products (53,090)
- Fabricated Metal Products (44,580)
- Chemicals (40,430)
- Machinery (33,620)
When combined, these five industries account for more than 50% of New York’s overall manufacturing employment. In terms of annual average wage rates, the highest-paying manufacturing subsectors include Computer and Electronic Products ($125,600) and Chemicals ($109,300).
Looking For Workers
Despite its long-time decline, many jobs still exist in the manufacturing sector. In fact, some manufacturers have reported difficulty finding workers. A 2024 report from Deloitte and the Manufacturing Institute claimed 3.8 million new manufacturing employees would be needed in the U.S. between 2024 and 2033, mostly due to looming retirements. However, half of the required jobs could potentially remain unfilled.
The report noted that “a combination of digital skills, soft skills, and high-level technical skills” would be most needed. The needed soft skills emerged from manufacturers’ expanding their direct customer interactions and efforts to expand their talent pool.
Manufacturing jobs were once seen as the quintessential example of good, high-paying blue-collar positions that didn’t require a college education. Reflecting how this industry has changed, the Manufacturing Institute highlighted that many of the open positions in manufacturing now require a bachelor’s degree.
The report noted three basic approaches that are being undertaken by manufacturers to alleviate the worker shortage and skills gap:
- Understanding changing workforce expectations
- Applying a customer focus to workforce challenges
- Taking an “ecosystem approach,” which they define as “…organizations coming together, or partnering, to solve shared problems and meet shared objectives,” to attract and upskill talent
Suggestions have emerged from other sources as well. An opinion piece in Forbes noted the possibility of focusing efforts on retraining existing manufacturing employees to enable them to do their current jobs in new ways. An NPR report suggested offering higher pay to solve the shortage, in addition to reporting on various other issues in manufacturing.
Downplaying the “pay them more” strategy, the Manufacturing Institute highlighted what it considered to be a PR problem for manufacturing, suggesting that many potential workers were put off by outdated images of what jobs in manufacturing entail.
Industry employment projections from the New York State Department of Labor suggest manufacturing’s long-term decline will continue over the coming years, falling by 50,220, or 11.9%, between 2022 through 2032. Of the 21 manufacturing subsectors in the projections, only computer and electronic products is projected to grow (+8.6%) over this period.
Current Developments
Many of the import tariffs enacted by the federal government earlier this year were done with the express intent of sparking the reshoring of manufacturing to the U.S. There are, however, at least two potential major challenges inherent in this approach. One is raw materials, as many of those are still imported. For example, a trade skirmish between the U.S. and China has begun, precipitated by China’s imposition of limitations on their export of rare earth metals, which are important inputs in certain types of manufacturing. The other is the potential for labor or skill shortages in this industry.
At the state level, the Rockefeller Institute noted: “New York State has emerged as a global leader in the semiconductor manufacturing sector.” Similarly, Empire State Development adds, “As a leader in the design and production of industrial machinery and systems, New York State produces everything from turbines and pumps to compressors and generators. New York State’s leadership position in the design and production of industrial machinery and systems is enhanced by its industry-leading research in high-tech electronics, software and materials processing, all of which can help manufacturers improve precision and efficiency.”
Central New York stands to benefit from a $100-billion expansion project proposed by tech company Micron. The company will manufacture computer memory chips in newly built fabrication plants within the White Pine Commerce Park located in Clay (Onondaga County). As of mid-October, initial site clearing and grading work was underway. 50,000 jobs are anticipated to be in or related to the new facilities, including 9,000 directly employed by Micron.
In a separate development announced in June 2025, high-tech manufacturer Orbic Electronics Manufacturing is expected to create more than 1,000 jobs on Long Island. More recently, Tarrytown-based Regeneron Pharmaceuticals announced in mid-November that they planned to build a $2 billion drug production facility in Saratoga Springs (Saratoga County). The new site will cover one million square feet and is expected to create 1,000 full-time jobs.
Conclusion
While the manufacturing sector is diminished from its peak, it continues to have an outsized impact on the U.S. economy. In New York State, the manufacturing sector employs hundreds of thousands and remains a resilient cornerstone of the state’s diverse economy. In addition, several ongoing or planned projects across the state may help to stabilize or grow manufacturing employment.
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