Manufacturing has led the U.S. recovery. In 2010, the sector's value added -- or its contribution to GDP -- rose 5.8% after declining during the previous two years.
The sector's rebound raises the potential of job growth as March manufacturing job openings climbed to 228,000 compared to 162,000 for the same period a year ago. During the first
quarter, factory production expanded sharply at a 9.1% annualized rate. And a new
study by Boston Consulting Group
shows that China's rising wages could position the U.S. to return to being one of the most competitive hubs for manufacturing.
For now, however, it's uncertain how long this could last, given that the rally has been partly driven by factories restocking inventory after having not done so for so long during the
depths of the economic recession. New orders for durable goods in April fell 3.6% -- more than expected. And shipments were down 1%, signaling that businesses may be holding back on new
capital investments as high unemployment and falling home prices continue to constrain consumers from spending much.