Nuveen: Manufacturing Benefits Boost the Entire US Economy

Investing in benefits for workers is one of the best things a manufacturer can do to drive growth.

That's according to research from one of the world’s largest investment managers, Nuveen, which has $US1.2tn in assets under management and operates across 32 countries. 

The consultancy seeks to drive global debate and broaden perspectives through evidence-based insights, which it's definitely accomplishing by highlighting the power of the US manufacturing sector. 

Nuveen has collated a broad body of research incorporating an Economist Impact survey of US workers, national benefits data and an economic model to analyse the impact of benefits at three levels in the manufacturing sector: workers, companies and industry/economy.

By analysing these impacts, we can understand more broadly how investing in worker benefits benefits everyone. 

Positive impact on workers

Manufacturing companies in the US spend a total of US$260bn on benefits for workers.

A huge proportion of these benefits – US$112bn, to be specific – go on insurance, providing access to routine healthcare and emergency coverage.

This is wise considering the extensive hazards and risks that exist in the sector. 

A staggering 10.6 million workers utilise these benefits, safeguarding themselves against financial consequences and further risk of injury in case of an accident. 

Manufacturers also invest millions in retirement, paid leave and wellness.

In 2023, more than half (51%) of manufacturing jobs in the US were held by people aged 45 and above, according to the 2023 Lightcast labour market. In 2024, the number of employees in this age bracket has only grown. 

With these demographic realities, investing in retirement is of vital importance.

Manufacturers are helping to secure workers' futures, ensuring they get adequate time to recuperate and make memories with family and friends.

Lesser, but significant amounts – around US$5-6.5m – are assigned to the areas of family planning, care and education. 

Education is an area where we’re likely to see manufacturing investment grow, with the rise of campuses, investment in upskilling and embracing of technologies like VR and AR to enhance training initiatives. 

These benefits have profoundly positive social impacts, encouraging workers to utilise subsidised caregiving, wellness programmes and education. 

According to the survey, 11% of manufacturing workers have families that take advantage of the education benefits.

Additionally, these benefits promote upward social mobility, equality and uplift local communities, with 15% of Asian manufacturing workers noting they were the first in their families with access to retirement, health insurance and parental leave.

Manufacturers who provide such benefits are statistically likely to retain valuable talent for longer.

Talent acquisition is a critical concern in the sector given the ongoing hiring and skills gap, and 64% of surveyed manufacturing workers said they'd switch jobs for better benefits. More than three-quarters (78%) say having access to better benefits has improved their health.

Therefore, providing such benefits is essential for manufacturers seeking to maximise costs and create a workforce full of happy, healthy employees. 

These benefits also impact other industries and the broader economy, showcasing manufacturing's status as the backbone of the US and global economy. 

Positively impacting companies, industry and the broader economy

Spending on manufacturing benefits boosts profits in other sectors, strengthening participation in the wider economy. 

For example, the money invested into retirement benefits for the manufacturing sector ends up benefitting the wholesale and retail trade sector, as workers are able to retire earlier and have more disposable income when they do.

Health insurance benefits lead to greater profitability for the health and social care sector, supporting the industry and meeting staff's medical needs.

Spending on education correlates with broader financial growth, as manufacturing workers and their families gain valuable skills and knowledge, enriching the labour pool and stimulating greater economic outputs.

The inverse is also true with wellness, where spending of US$3.6bn led to gains of US$27.5bn in the manufacturing sector. 

For the manufacturing sector, investing in employee benefits leads to profound gains on every front. 

Employees are happier, healthier and better skilled, making them significantly likelier to remain long-term at companies. 

Other sectors like healthcare and retail benefit from the investment, leading to positive national economic growth and spending that circles back to boosting manufacturers' profits. 

Because after all, when purchasing demand for vital medicines, clothes and toys rises, who is meeting that demand? Manufacturers.

By investing in employee benefits, you're doing better than buzzwords and promises. 

You're demonstrate your active willingness and enthusiasm to invest in workers' health, safety and, through education and retirement, their future.

That sends a profoundly meaningful and motivating message: you are important and your work is valued here. 

As Simon Sinek famously says: "When people are financially invested, they want a return. When people are emotionally invested, they want to contribute." 

Through employee benefits, manufacturers can build this emotional investment among staff, creating a supportive, caring culture and incentivising greater productivity, commitment and innovation. 

With these insights from Nuveen, there's no question that investing in benefits is one of the best things a manufacturer can do – for themselves, for their employees and for the wider economy.

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