Missouri Economic Indicator Brief: Manufacturing Industries
Posted on January 24th, 2017

​Manufacturing is a major component of Missouri’s $293.4 billion economy. It represents 13.1 percent ($38.5 billion) of the 2015 Gross State Product (GSP). Nationally, manufacturing contributed 12.2 percent to GDP.

Missouri ranks among the top 20 states for manufacturing employment and capital expenditures. Missouri manufacturers spent $3.3 billion, in 2014, on plant improvements and new construction.

Manufacturing accounts for 11.3 percent of the state’s private sector employment: 261,328 jobs across 6,579 establishments. The industry has added 18,300 jobs since 2010, growing 1.5 percent per year over five years compared to the nation’s 1.4 percent growth rate over the same period. Wages continue to grow, statewide and nationally. Missouri’s 2015 manufacturing payroll totaled $14.7 billion, a $56,368 average wage. This is higher than the state’s $46,000 private sector wage.
​Location Quotient Analysis
Location Quotient (LQ) compares the regional share of an industry to the national share so that an LQ over 1 indicates sectors of employment concentration. Missouri, with an LQ of 1.09, has a greater share of its workers employed in the manufacturing sector than the nation as a whole. About 57 percent or 66 out of Missouri’s 115 counties have an LQ over one, demonstrating a greater specialization in manufacturing compared to the nation.
Economic Contribution
Manufacturing industries make a significant contribution to the Missouri economy, directly and indirectly. Direct contributions come from employment in manufacturing firms and the compensation paid to industry workers. Indirect benefits come from business to business transactions and from workers who spend their earnings on consumer goods and services.

Manufacturing’s contribution to the Missouri economy is measured in terms of jobs created, incomes earned and valueadded. Value-added, a measure of industry sales minus production costs, refers to an industry’s share of Gross State Product (GSP).

Multipliers are a summary statistic indicating the magnitude of an industry’s impact on the economy. For example, a multiplier of 1.9 means that for every $1 in value-added generated by manufacturing, the state’s GSP increases an additional $0.90; similarly, an employment multiplier of 2.8 means that for every job created in manufacturing, nearly two jobs would be created in other industries.
In 2015 Missouri had an estimated 6,579 manufacturing establishments that directly employed
261,328 workers, paid $21.9 billion in wages and salaries, and contributed $38.5 billion to the state’s gross product. The ripple effect was an increase of $36.1 billion in additional economic activity.

Manufacturing’s total impact— direct and indirect effects— on the state economy was $74.6 billion which represents 25.4 percent of Missouri’s gross domestic product. Manufacturing industries and indirect industries employed 735,479 workers paying about $43.8 billion in salaries.

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