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When we think of the biopharmaceutical industry, we typically think of scientists in the lab working to create products with the potential to change people’s lives. What we don’t commonly consider, is the less-than-glamorous side of biopharmaceutical manufacturing and the benefits it brings to the United States economy. A recent report from TEConomy Partners and the Pharmaceutical Research and Manufacturers of America (PhRMA) seeks to change that by highlighting biopharmaceutical manufacturing’s leadership in the global economy and the economic factors that lead the National Science and Technology Council to designate biopharmaceuticals as a “priority advanced manufacturing area. Without further ado, here are the seven most important economic contributions of biopharmaceutical manufacturing.
When compared to the overall manufacturing industry and all private industries, the report found that between the year 2000 and 2016, the biopharmaceutical manufacturing industry outpaced both in overall economic output, including during the housing crisis of 2008-2009.
When it comes to overall productivity, biopharmaceutical manufacturing also has a leg up over traditional manufacturing. The report found that the value added per worker hired to be nearly three times that of all other manufacturing industries with $605 dollars of value added per worker compared to just $217 for general manufacturing. This serves to show biopharmaceutical manufacturing as a key growth driver as higher productivity is typically associated with the ability to pay higher wages and produce more output per labor unit input.
There’s more good news for those who work in biopharmaceutical manufacturing: the high economic value of biopharmaceutical manufacturing translates into higher wages for its workers. In 2017, the average wage for a person working in biopharmaceutical manufacturing was $115,010. This average wage represents a 72 percent greater average wage compared to those working in traditional manufacturing.
All these strong added-value activities of the U.S. biopharmaceutical manufacturing industry translate to productions worker’s compensation with the average production employee earning an average of $44,080 per year. This represents a 14 percent wage premium compared to production workers who work in all manufacturing.
Biopharmaceutical manufacturing is also responsible for higher and rising levels of investment expenditures compared to the rest of the manufacturing sectors. In 2016, biopharmaceutical manufacturers invested nearly $22,000 per worker compared to about $15,000 per worker across the manufacturing industry, which represents an increase of nearly 50 percent. Additionally, between the years 2010 and 2016 biopharmaceutical manufacturers amount of capital investment increased 17 percent totaling some $830 million in outlays.
Unsurprisingly, the high levels of capital investment required to build out new and existing facilities correlate to increased construction activity and more jobs in skilled trades. Between 2012 and 2017, biopharmaceutical plant construction projects accounted for nearly $22.4 billion and generated the equivalent of 23,000 full-time jobs.
Like many industries, biopharmaceutical manufacturers rely on a diverse number of manufacturers to obtain the inputs required in their production process. From precursor chemicals to analytical tools, packaging, labeling, and more, biopharmaceutical manufacturing’s economic benefits extend far beyond the scope of simply selling a product.
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