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Bureau of Labor Statistics > Productivity > Publications > Productivity Highlights

Manufacturing and Mining Labor Productivity

On April 27, 2023, the Bureau of Labor Statistics (BLS) updated measures for detailed industries in Productivity and Costs by Industry: Manufacturing and Mining Industries - 2022. Chart 1 reveals that labor productivity decreased in 21 of the 24 three-digit NAICS manufacturing and mining industries in 2022. All industries had growth in hours worked.

This horizontal bar chart shows the change in productivity, output, and hours in 2022 for three digit NAICS industries.
Chart 1 data. Productivity growth in three-digit NAICS manufacturing and mining industries, 2022


In 2022, the manufacturing sector comprised 10.3 percent of nonfarm business sector employment (13.2 million jobs) and 11 percent of U.S. Gross Domestic Product (GDP). The mining sector employed approximately 574,200 jobs, or 0.4 percent of all total nonfarm employees in 2022, and contributed 1.9 percent to GDP.

Resurgence of manufacturing employment

In many respects, manufacturing in 2022 looks a lot like 2021. There is strong demand for goods and record-breaking prices; 2022, like 2021, is an inflation story. What is unique about U.S. manufacturing in 2022 is the employment story. Employment is the driving force behind hours worked, labor productivity, labor compensation, and unit labor costs. Employment increased by 4.2 percent in 2022, the largest annual increase in the history of our series going back to 1987. After losing 648,000 jobs in 2020, the sector added back 178,000 jobs in 2021 and another 533,000 in 2022. Employment is now at 13.2 million, the highest level since 2008. Chart 2 shows employment in the manufacturing sector from 2007 to 2022. Employment plummeted during the Great Recession and never recovered. Employment also fell during the COVID-19 recession. However, in the current expansion, employment is not only increasing but surpassing pre-pandemic levels.

This line chart shows manufacturing employment from 2007 to 2022.
Chart 2 data. Manufacturing employment, 2007-2022


And there are still not enough workers. According to the National Association of Manufacturers, there are 1.5 jobs for every worker, with most manufacturers saying their number one challenge is filling those open jobs.[1] By 2030, the manufacturing skills gap could result in 2.1 million unfulfilled jobs.[2]

Outsourcing and automation have been strategies for factories to survive recessions. In the recent COVID-19 recession and recovery, ongoing global supply chain issues and soaring shipping costs have made domestic manufacturing more attractive. What is strikingly different about this recovery is the pivot towards re-shoring production.

Chart 3 shows the change in manufacturing employment from 2021 to 2022. All 21 three-digit NAICS manufacturing industries saw employment growth. The transportation equipment industry recorded the highest gains with 83.2 thousand more jobs in 2022.

This horizontal bar chart shows the change in employment from 2021 to 2022 for three-digit manufacturing industries.
Chart 3 data. Change in manufacturing employment, 2021-2022


Within transportation equipment and among all 86 four-digit NAICS manufacturing industries, motor vehicles recorded the highest employment gain, adding 37.6 thousand jobs in 2022.

Automakers invest in chips and batteries

Motor vehicles (NAICS 3361) is the second largest four-digit manufacturing industry in terms of sectoral output ($353.8 billion) and ranks 15 out of 86 in employment (291.8 thousand jobs). In 2022, this industry saw the largest employment growth among all four-digit industries (+14.8 percent) and the second largest increase in hours worked (+22.4 percent). Despite a large increase in output (+8.0 percent), labor productivity fell steeply (-11.7 percent) while unit labor costs soared (+14.2 percent), driven by the surge in employment and hours worked. (See chart 4.)

This bar chart shows the percent change in employment, productivity, and related data for motor vehicles in 2022.
Chart 4 data. Employment, productivity, and related data for motor vehicles, 2021-2022


Automakers continue to struggle with chip shortages and supply chain bottlenecks that started in 2021. The Russia-Ukraine conflict and pandemic-related shutdowns in China have worsened global supply chain issues, making it more difficult for automakers to secure enough semiconductors to meet the demand for new cars.[3]

The CHIPS and Science Act[4] and the Inflation Reduction Act,[5] both signed into law in 2022, dedicate hundreds of billions of dollars for domestic semiconductor production and electric vehicle supply chains over the next ten years. Automakers are not waiting and have already jump-started massive investment strategies to secure chips and batteries in building a North American supply chain.[6]

With rising consumer demand and government support for electric vehicles, automakers are investing billions of dollars for research and development and building new manufacturing plants for battery production.[7] This could lead to more vertical integration centered around auto production across the motor vehicles, semiconductor, and battery manufacturing industries over the next decade.

In addition to long-term investments in chips and batteries, automakers are also investing in the labor force, hiring as fast as they can. For example, Ford is already reaching out to eighth graders who will be high school graduates by the time their electric battery plants are scheduled to open.[8]

Such long-term investments will take several years to translate into output growth. As shown in chart 5, the drop in output was the driving force during the Great Recession, plummeting in 2008 and bouncing back in 2010, with hours following suit. In contrast, in the most recent downturn and recovery, hours are driving labor productivity, falling then rising faster than output.

This bar and line chart shows annual percent changes in output, hours, and labor productivity for motor vehicles from 2007 to 2022.
Chart 5 data. Labor productivity, output, and hours worked in motor vehicles, 2007-2022


Support activities in oil and gas extraction

The support activities for mining industry (NAICS 213) provides support services on a contract or fee basis required for the extraction of commodities across all mining industries. Almost all of these services are related to oil and gas extraction, with 97 percent of receipts[9] in either drilling oil and gas wells (NAICS 213111) or support activities for oil and gas operations (NAICS 213112). 

Employment in support activities for mining is also concentrated in these two component industries. In 2022, approximately 95 percent of the 270.3 thousand jobs in support activities for mining were in oil and gas drillings or operations.

Unsurprisingly, the performance of the support activities for mining industry is tied to the health of the oil and gas extraction industry. Chart 6 shows that output and hours in support activities for mining have followed the trend in oil and gas prices. As the price of oil and gas rises, oil and gas companies hire more contractors to expand production and meet demand.

This line chart shows oil and gas extraction prices and support activities for mining output and hours from 1987 to 2022.
Chart 6 data. Oil and gas prices and support activities for mining output and hours, 1987-2022


Chart 7 shows the number of wells that were completed and the number of wells that were drilled but not yet operational.[10] The data series, covering the period 2014 to 2022, illustrate that increased demand for oil and gas leads to more capital investment, which leads to increased output and hours worked in the industry.

This line chart shows oil and gas extraction prices and support activities for mining output and hours from 1987 to 2022.
Chart 7 data. Completed wells, drilled wells, and support activities for mining output, 2014-2022


Similarly, chart 8 shows the number of rotary rigs currently in operation and it too moves in the same direction as output in the support activities for mining industry. Both the number of wells in production and the number of active rotary rigs currently drilling show that when the oil and gas extraction industry needs to expand its operations it relies on contractors to do so.

This line chart shows the number of active rotary rigs and support activities for mining output from 1987 to 2022.
Chart 8 data. Number of active rotary rigs and support activities for mining output, 1987-2022


Expanded demand and capital investment led all these measures to trend upwards in 2022 after decreasing significantly during the pandemic. Prices for oil and gas soared 50.6 percent in 2022 and the number of completed wells grew approximately 20 percent as demand for all uses of oil and gas increased. This led to record profits for oil and gas extraction companies and expanded capital investment. The number of active rotary rigs and drilled wells each grew by more than 50 percent in 2022 as oil and gas companies eyed expanding future production. These trends meant that oil and gas companies leaned on contractors and output for support activities for mining grew 23.8 percent.

Related resources

Industries at a Glance: Manufacturing NAICS 31-33

Industries at a Glance: Mining, Quarrying, and Oil and Gas Extraction NAICS 21

Multifactor productivity slowdown in U.S. manufacturing

Dispersion Statistics in Productivity for U.S. manufacturing

Overview of BLS Productivity Statistics