McKinsey Global Institute
Myth busted: The multiplier effect is higher in services than in manufacturing
One of the outdated beliefs about the role of manufacturing in the economy is that manufacturing has high multiplier effects--the amount of demand in the economy created by each new manufacturing job. This demand creates additional employment. While manufacturing jobs indeed create additional employment needs, they do not do so at a higher rate than service jobs. In fact, as this chart from our Manufacturing the Future Report bit.ly/QpiKHN shows, service jobs have higher multiplier effects. In fact, service industries with the highest multiplier effects (food and drink services) create nearly twice as much additional demand in the economy as the manufacturing jobs with the highest multiplier effects (in apparel and leather manufacturing).
Myth busted: The multiplier effect is higher in services than in manufacturing
One of the outdated beliefs about the role of manufacturing in the economy is that manufacturing has high multiplier effects--the amount of demand in the economy created by each new manufacturing job. This demand creates additional employment. While manufacturing jobs indeed create additional employment needs, they do not do so at a higher rate than service jobs. In fact, as this chart from our Manufacturing the Future Report bit.ly/QpiKHN shows, service jobs have higher multiplier effects. In fact, service industries with the highest multiplier effects (food and drink services) create nearly twice as much additional demand in the economy as the manufacturing jobs with the highest multiplier effects (in apparel and leather manufacturing).