Report: Mississippi gets mixed grades on manufacturing

Mississippi’s manufacturing industry got mixed grades in a report card Ball State University’s Center for Business and Economic Research just released.

The state did well overall, earning a “B-”, in sector diversification (“A”), tax climate (“B”), and performed adequately in logistics and worker benefit costs, earning a “C” in each.

The poorest grades came in expected liability gap, innovation and global outreach, where the state earned a “D” in all three.

Human capital, or quality of workforce, is where Mississippi failed. The state got an “F” in that category.

“Mississippi remains weakened” by that, said Michael Hicks, director of Ball State’s Center for Business and Economic Research.

It’s been an issue for a while, Mississippi Manufacturers Association president Jay Moon said earlier this year in an interview with The Clarion-Ledger. Manufacturing has advanced beyond stapling upholstery to a wooden furniture frame, he said. Now, employers want people technologically literate who can operate a machine digitally rather than manually. The growth in what the industry calls advanced manufacturing has increased the demand for better-trained workers.

“As manufacturing becomes more technical, they need higher skill levels, and in many cases, it’s simply not there,” Moon said. “That’s why we spend a lot of time finding the next generation of manufacturing workforce. But it’s a good career path.”

Like it did the rest of the U.S., the recession gutted Mississippi’s manufacturing sector. According to the Economic Policy Institute, the state lost almost 100,000 jobs, or about 8.5 percent of the total workforce.

That has changed, Moon said. “We have a lot of expansion in the state, orders are picking up and things are looking a lot better than they were.”

Ball State’s report bears that out. By 2013, four years after the recession that crippled manufacturing and every other industry had mathematically ended, there was legitimate recovery happening. The largest gains nationwide were in the production of metals, machinery, automobiles, apparel and petroleum.

Mississippi is well-represented in each of those categories. Nissan and Toyota anchor Central and Northeast Mississippi’s manufacturing corridors, respectively. Overall, auto manufacturing and its spin-offs grew by 87 percent from 2009-13, the manufacturing and logistics study found. The Golden Triangle’s PACCAR Engine Co. and Steel Dynamics are a part of $5 billion of total investment in that region the last 12 years.

The Mississippi Gulf Coast’s petroleum manufacturing sector, led by Chevron’s Pascagoula refinery, is one of that region’s largest employers.

By 2014, the recession had completely loosened its grip on manufacturing, Ball State’s data say.

“There are major misunderstandings among the public and the media about the manufacturing sector,” he said. “The U.S. manufacturing base is not in decline, and we have recovered from the recession. Nor are jobs being outsourced because American manufacturing can’t compete internationally. Moreover, new jobs in manufacturing pay well above the average wage.

“Overall, only 13 percent of lost jobs over the past decade, which are less than 4 percent of all manufacturing jobs, can be linked to international trade, and most of trade-related job losses are in low-productivity sectors,” Hicks said. “Changes in productivity, domestic demand and foreign trade all impact manufacturing employment in the U.S., and it’s important to clarify those impacts in order to understand what is happening in the manufacturing and logistics industries.”

Contact Clay Chandler at (601) 961-7264 or cchandler@jackson.gannett.com. Follow @claychand on Twitter.