California manufacturing jobs, No. 1 in US, face trade war unknowns

America’s long-languishing factory jobs are a focal point of the Trump administration’s global tariff battles.

The White House argument supporting higher taxes on various imports is that unfair trade policies have, among other things, crushed American manufacturing. Cheap foreign goods made it hard for U.S. factories to compete, this logic argues. Tariffs would swiftly increase the prices of foreign-made products, giving domestic production an advantage. Not to mention, these trade-related levies would help narrow the federal government’s spending gap.

Californians should be watching carefully – whether you’re a tariff fan, or not – because the state is the nation’s hot spot for factory work.

Last year, manufacturing employed 1.25 million statewide – staffing that’s just below California employment in industries such as retail, dining or professional services, and slightly larger than social assistance, office administrative workers or local schools.

California also represents 10% of the nation’s 12.8 million manufacturing workforce, according to my trusty spreadsheet’s peek at various federal job stats. Texas was No. 2 with 973,600 jobs, followed by Ohio with 683,800, Michigan with 605,600, and Illinois with 578,200.

The rub is that manufacturing jobs are in serious decline in most states, including California. Foreign trade is frequently blamed for the job losses.

Critics of America’s trade policies often cite the World Trade Organization‘s debut in 1995 as a key turning point in U.S. manufacturing’s troubles. The global trade regulator is seen by its American detractors as a group that often ignores U.S. interests. And China’s 2001 entrance to the WTO, giving it broader access to world markets, made the plight of U.S. factories even worse.

Since 1995, the nation lost 4.5 million factory workers. California dropped 468,200 factory workers – more than any state – over these three decades. New York is down 394,400 jobs, North Carolina is off 363,300, and Ohio lost 353,800.

By the way, eight states gained manufacturing work in this same period, topped by Utah’s 35,800 growth, Nevada, up 31,300, and Idaho adding 12,200.

Think of the severity of these drops. The nation has lost 26% of its manufacturing jobs since 1995. California’s down 27% – and that’s the 29th best performance. Yes, roughly one quarter of factory jobs are gone.

The biggest hits since 1995? Rhode Island lost half its manufacturing work, while New York is down 49%, and Massachusetts and North Carolina lost 44%.

Among the manufacturing winners, Nevada had the biggest percentage gain, up 88% since 1995. Then came North Dakota, up 43%, and Utah, up 31%.

Slipping slice

Manufacturing today is a substantial but not giant chunk of California’s overall economy – or the nation’s.

California had 7% of its workers at factories last year, the 32nd highest share among the states. Manufacturing was 8% of the 2024 U.S. job market.

Where factory work becomes an economic force – and a political talking point – is between the coasts. Indiana had 16% of its jobs in manufacturing last year. Wisconsin had 15%, Iowa had 14%, and Michigan and Alabama were at 13%.

Ponder the decline of this industry’s share of overall employment since 1995. California manufacturing is down from 14% of the job market three decades ago. But that drop ranks nowhere near the largest losses.

North Carolina factories employed 9% of all of the state’s workers last year – down from 24% in 1995. Arkansas is down to 12% from 23% in 1995. Mississippi is also at 12%, down from 22% three decades ago.

Payday

Another reason manufacturing losses resonate as a popular cause is the industry’s reputation for paying decent wages.

California factory work ranks No. 5 nationally with an average $30.51 hourly wage, 12% above the national average of $27.11. The top four are Wyoming ($33.77), Colorado ($32.52), Washington state ($32.35), and Connecticut ($31.38).

Yet manufacturing pay is by no means stellar in California. Factory wages statewide are only 77% of the typical California worker’s $39.53 hourly rate in all industries. But that’s on par with the nation where factories pay 79% of the average U.S. wage.

Manufacturing pays above or near the statewide norms in five states: Wyoming at 108%, Louisiana at 103%, Texas at 92%, Florida at 92%, and Kentucky at 90%.

Job-creation magic?

Just how much tariffs could energize American factory jobs – and the broader economic costs of such a swing – is a grand debate.

U.S. manufacturing jobs tumble for a host of reasons other than cheap imports – even if those bargains are something the typical American consumer relishes.

Barriers to U.S. factories selling their products in other nations doesn’t help. And automation and various other manufacturing improvements are cutting the number of workers needed to make various goods.

Will tariffs have job-creation magic?

Robot-driven production will drive any future improvement in U.S. factory output, limiting the upside for factory jobs.

Worse, consider American factories specializing in exported goods. They may be hurt by retaliatory tariffs on U.S.-made goods if trade talks don’t quickly solve global tensions.

Jonathan Lansner is business columnist for the Southern California News Group. He can be reached at jlansner@scng.com