The Determinants of the Redistribution of Manufacturing in the United States Since 1929
SINCE I929 there has been a substantial change in the location of manufacturing in the United States. The direction of redistribution has fairly consistently been from north to south and from east to west. In I929 the South and West together accounted for less than one out of every four United States manufacturing employees and for only one-fifth of value added by manufacture. By I958 1 their share of United States manufacturing had increased to one-third as measured by either variable. This change has had a significant impact on the political, social, and economic life of the nation. The consequences for businessmen, labor leaders, and government officials have been strong, direct, and sometimes painful. Inevitably, the question that arises is why? Why did this change occur? What were the historical developments and economic forces that determined its extent and direction? The purpose of this paper is to delineate the outlines of an answer to this question. In particular, we shall examine and reject the hypothesis that regional shifts in demand or markets were the major determinant of locational change. Area differentials in the rate of growth of manufacturing are the result of area differentials in the rate of growth of individual industries and of area differences in industrial structure. The latter refers to the extent to which an area's industries are those which, at the national level, are experiencing rapid or slow growth. If an area has predominantly fast-growing industries, we say it has a structure. If it has predominantly slow-growing industries, we refer to its structure as unfavorable. 2 The first point to be made is that the redistribution of manufacturing since I929 has been primarily the result of area differentials in the growth of individual industries rather than the result of differences in industrial structure. This need not always be true. The shift of industry to the Southeast in England in the inter-war decades was attributed more to differences in industrial structure than to area differentials in the growth of specific industries.3 In the United States, I929-I954, the comparative growth of manufacturing employment by state, unadjusted, was highly correlated with comparative growth, adjusted for industrial structure. (Spearman's coefficient of rank correlation equals +.8 ii.) Comparative growth, unadjusted, showed no correlation with the extent to which a state had a comparatively favorable or unfavorable industrial structure. (Coefficient of rank correlation equals + .003.) 4 Table i presents the comparative gain or loss of manufacturing in each Census division between I929 and I954, and shows it divided into two parts. The first represents the sum of the comparative gains or losses of individual industries. The second, or remainder, is a rough measure of the influence of industrial structure.5
- DOI
- 10.2307/1928199
- Volume
- 44 (2)
- Pages
- 167
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