Columbus, OH – Today's U.S. Bureau of Labor Statistics jobs day release states 217,000 jobs were added to the economy in May, down slightly from April but still positive overall. The consistent strong performance of the job market suggests the weak Q1 GDP report was driven by particularly harsh winter weather and the drawdown of excess inventories.
Today's jobs release reports that manufacturing experienced some of the strongest growth in May, with 10,000 jobs added. This is a continuation of strong manufacturing job performance already in 2014, with 12,000 jobs added in April and 105,000 jobs added since May 2013.
Thomas A. Stewart, Executive Director of the National Center for the Middle Market, said, "It's not just onshoring that has fueled a manufacturing revival in the United States, backed by government incentives and reported in the media. We know from our research that mid-sized manufacturers have operated successfully in local communities for decades without much fanfare, creating well-paying jobs and investing back in their businesses. We need to think differently about how to support them in the future."
With annual revenues of $10 million to $1 billion, the U.S. middle market represents just three percent of American companies, yet generates one-third of private sector GDP and created 70 percent of all new jobs in 2013.
The National Center for the Middle Market's Q1 report shows manufacturing executives reported strong growth. Sixty percent of executives stated that their company performance improved in Q1, whereas only nine percent said it deteriorated. Additionally, 63 percent stated revenue increased and 41 percent said employment also increased.
Looking ahead to the remainder of 2014, 61 percent of middle market manufacturing executives project gross revenue will grow and 43 percent project employment will grow. The projected growth numbers are 4.6 and 2.3 percent for revenue and employment, respectively.
To support the growth of mid-market manufacturers, executives highlight two key areas: tax simplification and skilled workforce. At 21.3 percent, these companies pay one of the highest average effective tax rates across middle market industries and firms. Most interesting, executives say tax code simplification is as important as lower corporate taxes.
Manufacturing executives also cite the ability to attract, train, and retain talent as the fastest growing concern for them. Manufacturing companies see a shortage in top-quality and highly trained talent and see educating America's workforce as a top priority.
BACKGROUND – NCMM:
The National Center for the Middle Market (NCMM) was founded in 2011 in partnership with GE Capital and is located at The Ohio State University’s Fisher College of Business. The Center is the nation’s leading research institution dedicated to helping middle-market companies be more competitive through rigorous and relevant research, thoughtful outreach, and educational programs.
On a quarterly basis, NCMM releases the Middle Market Indicator (MMI), a survey of 1,000 C-suite executives that focuses on key growth challenges and opportunities. This year’s Q1 survey explored how concerns about increased cost of doing business - particularly related to health care, taxes and workforce development - are impacting growth potential in this key sector. To learn more about the Center or the MMI, visit www.middlemarketcenter.org.
CONTACTS:
Kate Bernard
Hamilton Place Strategies for the National Center for the Middle Market
kbernard@hamiltonps.com
(202) 822-1206
Jeff Caywood
GE Capital
jeff.caywood@ge.com
(513) 530-7028
Ann Hamilton
The Ohio State University Fisher College of Business
hamilton_847@fisher.osu.edu
(614) 292-8150