Most recent manufacturing job gains are fading, but growth persists in dynamic places

By the third quarter of 2022, U.S. manufacturing employment had not only surpassed its 2019 peak but also reached its highest level since the Global Financial Crisis. Yet post-pandemic gains in manufacturing employment have been uneven across states and metropolitan areas.

Data through 2025 reveals that manufacturing jobs growth over the past six years has been highly concentrated. Over four-fifths of this employment growth has occurred in just 354 out of 3,143 counties. These high-growth counties accounted for around a quarter of 2019 U.S. employment in the sector. Areas that have sustained such growth into 2025 tend to have high dynamism and low pre-existing manufacturing dependence. Many legacy industrial cities continued to struggle.

Where are the new manufacturing jobs?

In the map below, pink-shaded counties, representing 62.3 percent of manufacturing employment in 2019, saw zero or negative growth between 2019 and the first three quarters of 2025. National recovery in manufacturing after 2020 was therefore driven by blue-shaded counties with positive net job growth. The high-growth counties with over 350 net new jobs accounted for 26.5 percent of national manufacturing employment pre-COVID but have contributed 83 percent of growth since then.

Aside from Florida, where most counties experienced gains in manufacturing employment, and the New England states, where nearly all counties lost manufacturing jobs, most states exhibit a common pattern: job losses in rural counties and large metropolitan cores, and gains in small cities and suburban areas.

Between 2019 and the first three quarters of 2025, 95.6 percent of net manufacturing jobs growth at the state level was concentrated in just twelve states, which can be grouped into three regions: the Southeast, Great Plains, and Mountain West.

The southeastern states of Florida, Georgia, Alabama, and South Carolina together account for 35.8 percent of state-level manufacturing jobs growth. “Superstar” manufacturing counties in this region are anchored by existing heavy-industrial clusters such as Huntsville–Decatur, Alabama; Spartanburg, South Carolina; and Savannah, Georgia, with growth driven primarily by expansions in the aerospace and automotive industries.

Florida stands out for having the largest share of counties with significant manufacturing increases. The state’s strength stems partly from its comparatively high dynamism in the sector, such as robust firm entry and job churn. In 2019, the manufacturing startup rate in Florida was 6.9 percent, compared with 4.7 percent nationally. Subsequently, Florida’s startup rate in manufacturing increased steadily each year, reaching 8.1 percent in 2023. By contrast, the national startup rate in the sector rose briefly to 5.3 percent in 2022 before falling back to 4.8 percent in 2023.

Texas added the most manufacturing jobs of any state, accounting for over a third of the country’s manufacturing employment growth since 2019. Manufacturing expansion in Texas spans multiple industries and is concentrated around the four largest metropolitan areas: Dallas–Fort Worth, Houston, San Antonio, and Austin.

The three states in the Lower Missouri River Basin, Kansas, Missouri, and Nebraska, also saw notable manufacturing job gains. Growth is concentrated in the suburbs of large metropolitan areas such as Kansas City, as well as in small and mid-size urban centers like Garden City, Kansas, and Columbia, Missouri. Alongside their traditional strengths in food processing and aerospace manufacturing, these states have also seen substantial job gains in chemicals, pharmaceuticals, machinery, and electric vehicle components.

Finally, four Mountain West states — Arizona, Nevada, Utah, and Idaho — recorded both large absolute gains in manufacturing employment and percentage increases exceeding 8 percent. Semiconductor manufacturing in Arizona’s Phoenix–Tucson corridor and Boise, Idaho (home to Micron), benefited from CHIPS and Science Act funding alongside rising global demand. Nevada increased manufacturing employment by 13.4 percent between 2019 and 2025, partly driven by expansion of the existing Tesla Gigafactory in the Reno metro area. Smaller urban centers such as Idaho Falls, Idaho, and Cedar City, Utah, experienced growth in chemical manufacturing, while suburbs of Salt Lake City saw a pronounced expansion in pharmaceutical production.

Has manufacturing growth held up?

Comparing manufacturing employment levels between the 2019 annual average and the 2025 Q1–Q3 average masks key dynamics in the intervening quarters. After the 2020 recession, manufacturers benefited from rebounding demand, monetary easing, federal investment, and the resumption of global trade. However, as the economy began to cool in 2022, manufacturing startup and job-turnover rates began declining, indicating that the brief upswing in dynamism has largely eroded. Supply chains have also faced disruptions from tariffs and armed conflicts.

Nationally, manufacturing employment has slipped from its post-pandemic peak of 12.9 million in the third quarter of 2023 to 12.6 million in the third quarter of 2025.

The map above shows which core-based statistical areas (CBSAs)¹ are continuing to grow their manufacturing employment and which are past their post-2019 peak levels. CBSAs that sustained manufacturing growth into 2025 expanded employment by 12.9 percent, outstripping total workforce expansion by 3.1 percentage points and raising manufacturing’s share of total employment by 0.2 percentage points. Yet these growth centers account for only 13 percent of U.S. manufacturing employment as of 2019, demonstrating a high degree of concentration.

Among states that added substantial manufacturing jobs, sustained growth was concentrated in specific metro areas. Of the 67 Texas CBSAs that increased manufacturing employment, 23 continued to expand into 2025, accounting for 45.8 percent of the state’s manufacturing workforce in 2019. An overwhelming 95 percent of Nevada’s pre-pandemic manufacturing employment was in CBSAs that maintained growth through 2025. In contrast, Arizona’s CBSAs in the Phoenix–Tucson corridor experienced rapid semiconductor and EV-driven expansion but reached peak manufacturing employment in 2023. Only 0.5 percent of the state’s 2019 manufacturing jobs were in areas that maintained their post-pandemic growth trajectory.

The time series of manufacturing employment in CBSAs that are still growing and have not yet reached their employment peak reveals a critical turning point in the post-pandemic recovery. Employment in these growing CBSAs continued to rise through mid-2022 despite reversals in a few sparsely populated areas.

Beginning in the third quarter of 2022, however, the series experienced a sharp decline as increasing numbers of CBSAs reached their peak employment levels and exited the sustained growth category. This inflection point coincides closely with the Federal Reserve raising interest rates throughout 2022 to combat inflation. The tightening of monetary conditions, together with a slowdown in the broader economy, likely curtailed post-pandemic workforce expansion across many manufacturing businesses and contributed to the widespread peaking of employment levels observed thereafter.

The seeds of manufacturing divergence were planted before the COVID recession. In 2019, a quarter of manufacturing firms in metropolitan areas² with employment growth into 2025 were younger than five years old, compared to 22 percent for metro areas that grew but reversed course and 20 percent for those that never recovered. This higher concentration of young firms suggests stronger entrepreneurial capacity in the years leading up to 2019, which likely boosted startup formation after the pandemic shock. Startup rates confirm this pattern: sustained-growth areas consistently had a larger share of new manufacturing firms between 2019 and 2023.

Metro areas that sustained growth into 2025 had the highest manufacturing establishment entry rates from 2019 to 2023 compared to the other two categories. While entry rates declined after 2022 across most metro areas, corresponding to employment peaking nationwide, the decline was least pronounced in metropolitan statistical areas (MSAs) with sustained growth, falling by only 0.5 percentage points while areas that reversed course or declined saw entry rates fall by more than twice as much.

Those with consistent growth into 2025 also show higher establishment exit rates, indicating elevated churn and dynamism. However, exit rates vary less across metro area categories than entry rates, suggesting ease of entry for new manufacturers likely contributed more to divergent growth paths than factory closures.

Our examination of post-pandemic manufacturing employment trajectories reveals high geographic concentration and widespread reversal of gains. Existing factories hire more workers during periods of high demand, monetary expansion, and government investment, but new manufacturers and plants appear to be crucial for enduring employment gains.

An American manufacturing renaissance requires understanding the policy conditions that enabled higher dynamism in areas with sustained manufacturing growth. We already know some levers that would work: removing regulatory hurdles for opening new factories, making it cheaper and easier to build workforce housing, and raising labor mobility through right-to-work laws and noncompete bans.

Policymakers must take dynamism seriously as a prerequisite for resilient manufacturing ecosystems. And we have shown the places that could offer a few lessons.

1. Including metropolitan and micropolitan areas, as defined by the Office of Management and Budget. We focus on CBSAs because they avoid small counts by aggregating counties around urban cores and provide good coverage of manufacturing employment (93.3 percent of 2019 national totals).

2. Due to BDS imputation of establishment and firm counts in most micropolitan areas, we have to restrict our analysis to metropolitan statistical areas. MSAs included 80.6 percent of manufacturing employment in 2019.