Economists are starting to get a little worried about the manufacturing industry. Comprised of a broad range of establishments engaged in the mechanical, physical or chemical transformation of materials including CNC machining equipment – the manufacturing industry has been experiencing U.S. and Chinese trade imbalances. The U.S. global trade deficit in manufactures increased by 21 percent to $213 billion in the first half of 2011, compared with 2010, while the Chinese surplus roared by 27 percent to $280 billion, according to the Manufactures Alliance/MAPI report.

Whether your company is involved in post weld heat treatment services or petroleum products, there is an emerging concern for U.S manufacturers. According to the report, manufactured goods make up the main sector of trade, representing 95 percent of Chinese and 80 percent of U.S. merchandise exports. The sector also represents technological advances. Nearly two-thirds of U.S. civilian research and development come from the manufacturing industry, such as the latest technology in high pressure fittings and other services.
The changing face of Chinese exports is becoming a major concern for U.S manufacturers.

“It is generally known that China has overtaken the United States as the world’s top exporter,” said Ernest H. Preeg, MAPI Senior Advisor for International Trade and Finance. “In 2000, U.S. global exports of manufactures were three times larger than Chinese exports, while by 2010 Chinese exports were 50 percent higher, and on track to double U.S. exports by 2013.”

“What is less understood is the dramatic restructuring of Chinese manufactured exports away from labor-intensive to investment-intensive high-tech industries,” said Preeg.

“This new orientation of exports is less driven by wage rates, especially for low-skilled workers, and is far more dependent on investment with advanced technology content.”
So what do the results of the report mean for manufacturers like those at butt welding facilities? The Los Angeles Times reports that industrial production in the U.S. grew in July at its fastest pace of the year, settling the fears that the U.S. manufacturing sector might be slowing down.