South, Mountain West see manufacturing boom under Biden

A manufacturing boom has swept across the country in President Biden's 2½ years in office, with the South and Mountain West — including several red states — having especially strong growth, according to Bureau of Labor Statistics data.

Why it matters: The U.S. economy has added some 800,000 manufacturing jobs nationwide, a figure Biden hopes will boost his claim to have delivered on his promise to be a president — and create jobs — for all Americans.

• In his re-election campaign, Biden is seeking to take credit for those new jobs, especially the union ones.
• Former President Trump also is making a play for the union vote and trying to convince auto workers that Biden's focus on electric vehicles will translate into fewer factory jobs.
• Biden's challenge for 2024 is to draw a link between his three signature pieces of legislation — the Bipartisan Infrastructure Law, the Inflation Reduction Act, and the Chips and Science Act — and the country’s resurgence in manufacturing, a sector in which the average hourly pay is $32.
• He will be competing with governors — Republicans and Democrats — who also can take credit for the economic growth in their states, and frequently do.

By the numbers: Texas is the top state for new manufacturing jobs, with 86,000 new positions, from January 2021 to May 2023, according to BLS data.

• Next comes California with 79,000 jobs; Florida with 37,000; Ohio with 31,000; and Georgia with 29,000.
• Nevada had the greatest percentage increase at 15%, followed by Montana at 11% and Wyoming at 10%.

Driving the news: Biden traveled to a Philadelphia shipyard Thursday to try to persuade union workers that his spending on renewable energy will help the workers' bottom line — part of his broader push to convince a skeptical public that "Bidenomics" is working.

• "When I think climate, I think jobs — union jobs," Biden said.
• Trump countered that pitch in a video, saying, "If you want to have an auto industry, you need to defeat Joe Biden."

Between the lines: While touting his spending — and job growth — in red states, Biden also likes to needle Republicans for voting against most of his proposals.

• On a trip to South Carolina last week, he teased a visit to Rep. Marjorie Taylor Greene's district to help break ground on a new solar facility.

The big picture: The U.S. economy has defied expectations and continues to add jobs. An elusive soft landing to the Fed's aggressive rate hiking — in which inflation continues to decline without unemployment rising — now seems possible.

• Goldman Sachs economists have lowered the probability of a recession in the next 12 months to 20%, down from 30% last July, according to Axios Markets.
• Still, polling indicates deep dissatisfaction with Biden's handling of the economy. Some of that negativity is likely spillover from partisan views about the president, whose favorability rating is in the low 40s in most major polls.

• Anemic wage growth also could be to blame. But with inflation cooling and wage growth picking up, Biden's team hopes perceptions about the economy will improve.

Yes, but: There are signs the manufacturing sector is slowing down, which could undercut a key component of Bidenomics.

• The Institute for Supply Management's manufacturing gauge fell to 46% in June, its weakest reading since May 2020. Anything below 50 suggests contracting activity.
• And in a June survey, manufacturers reported they were less optimistic about their company’s outlook than last quarter, with nearly 2/3 of respondents complaining about regulations.

Go deeper: Arizona and Georgia — states Biden flipped from former President Trump in 2020 — have added a higher percentage of manufacturing jobs than the national average of 6.4%.

• Arizona has seen 16,000 new jobs for a 10% increase and Georgia's economy has added 40,000 jobs for a 7.5% increase.
• In the three other states Biden won back for Democrats in 2020 — Michigan, Pennsylvania and Wisconsin — thousands of jobs have been added, but the percentage increase has not been as explosive as in the South and West.
• Michigan has added 24,000 manufacturing jobs for a 4% increase. Pennsylvania has added 28,00 jobs for a 5% increase. Wisconsin has added 20,000 jobs for a 4% increase.

The bottom line: A healthy economy is the linchpin of Biden’s reelection strategy.

• He needs the economy to keep adding them, especially in the states where the 2024 election is likely to be decided.