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Manufacturing in the Upper East Region
The Upper East Region includes 23 counties in the northeast corner of Texas, stretching from the Arkansas and Louisiana borders on the east to Cedar Creek Reservoir in the west.
The Upper East region includes three metropolitan statistical areas (MSAs): the Longview MSA, comprising Gregg, Rusk and Upshur counties; the Texarkana MSA, which comprises Bowie County, and the Tyler MSA, comprising Smith County. The region’s economic core is centered in the city of Tyler in Smith County.
In 2019, the Upper East Region had an estimated total population of about 1.2 million, about 4 percent of the total Texas population, and accounted for nearly 3.4 percent of the state’s total employment.
The region included more than 50,700 manufacturing jobs in 2019, about 12 percent of its total employment of more than 427,000. The sector’s contribution to regional gross domestic product (GDP) and total wages was much larger, however, in a testament to the region’s high-value manufacturing production. The manufacturing sector’s regional GDP of $8.6 billion accounted for 17 percent of the total regional GDP of $50.8 billion. The Upper East Region’s manufacturers paid more than $2.7 billion in wages in 2019, or 14.5 percent of total regional wages of $18.9 billion. Annual wages for its manufacturing jobs averaged $54,135 in 2019, versus average wages of $44,344 for all regional jobs.
In 2019, manufacturing activity had a particularly significant effect on Morris County, contributing 57.9 percent of the county’s total wages and 53.9 percent of its total GDP, results far exceeding regional averages. The county’s manufacturing jobs also paid the region’s highest average wages in the sector, at about $73,366 (Exhibit 1).
Exhibit 1: Manufacturing Overview by County, Upper East Region, 2019
| County | Employment | Gross Domestic Product | Wages | ||||
|---|---|---|---|---|---|---|---|
| Total | Share | Total (millions) | Share | Total (millions) | Share | Average Annual Wages |
|
| Anderson | 1,557 | 7.6% | $212 | 10.0% | $73.3 | 7.8% | $47,052 |
| Bowie | 2,018 | 4.8% | $243 | 6.2% | $95.9 | 5.6% | $47,494 |
| Camp | 154 | 4.0% | (D) | (D) | $4.7 | 3.1% | $30,237 |
| Cass | 1,359 | 17.3% | $219 | 24.7% | $89.6 | 30.2% | $65,972 |
| Cherokee | 2,396 | 16.2% | $214 | 14.3% | $97.9 | 17.8% | $40,855 |
| Delta | 16 | 1.5% | (D) | (D) | $0.5 | 1.8% | $31,103 |
| Franklin | 112 | 3.5% | (D) | (D) | $3.5 | 2.5% | $31,034 |
| Gregg | 8,030 | 10.5% | $1,080 | 13.3% | $484.1 | 13.1% | $60,283 |
| Harrison | 5,789 | 25.2% | $2,105 | 43.4% | $384.8 | 32.6% | $66,470 |
| Henderson | 2,407 | 13.7% | $230 | 12.1% | $106.1 | 15.8% | $44,087 |
| Hopkins | 1,852 | 14.3% | $205 | 12.9% | $95.4 | 18.4% | $51,516 |
| Lamar | 5,374 | 24.5% | $1,051 | 36.0% | $312.3 | 32.6% | $58,109 |
| Marion | 351 | 17.6% | $71 | 23.4% | $21.6 | 31.6% | $61,740 |
| Morris | 1,573 | 41.5% | $359 | 53.9% | $115.4 | 57.9% | $73,366 |
| Panola | 1,040 | 12.4% | $106 | 5.1% | $47.8 | 11.5% | $45,985 |
| Rains | 102 | 5.0% | $12 | 5.2% | $3.8 | 5.5% | $37,428 |
| Red River | 468 | 17.5% | $39 | 12.6% | $16.1 | 16.6% | $34,471 |
| Rusk | 1,438 | 10.6% | $220 | 8.5% | $65.6 | 10.7% | $45,602 |
| Smith | 6,421 | 6.1% | $980 | 8.7% | $338.7 | 6.9% | $52,750 |
| Titus | 5,630 | 35.0% | $794 | 40.0% | $253.7 | 41.2% | $45,069 |
| Upshur | 372 | 5.1% | $45 | 5.1% | $17.5 | 6.1% | $47,158 |
| Van Zandt | 1,022 | 9.0% | $248 | 19.1% | $55.8 | 13.5% | $54,580 |
| Wood | 1,266 | 12.2% | $214 | 14.3% | $63.1 | 15.7% | $49,806 |
| Upper East Region Total | 50,748 | 11.9% | $8,645 | 17.0% | $2,747 | 14.5% | $54,135 |
| Texas | 908,801 | 7.2% | $241,005 | 13.1% | $72,473 | 9.6% | $79,746 |
(D): data not shown to avoid disclosure of confidential information.
Sources: JobsEQ, U.S. Bureau of Economic Analysis and Texas Comptroller of Public Accounts
The Upper East Region is home to a variety of educational programs that train the workforce in advanced manufacturing. Longview’s East Texas Advanced Manufacturing Academy partners with Kilgore College to provide a 16-week course on precision machining technology or instrumentation and electrical technology. It also serves as a training center for local industry and an adult education center for retraining.
Several of the region’s community colleges also provide degree or certificate programs in advanced manufacturing. Texarkana College, for example, offers an Industrial Maintenance/Multi-Craft Certificate program that trains students in six different trades and prepares them for a wide range of jobs including industrial machinery mechanic. Texarkana College estimates median pay for industrial machinery mechanics at $62,310 and projects job opportunities will rise by 16 percent in the next 10 years.
Long-Term Regional Trends
Between 2001 and 2019, manufacturing employment in the Upper East Region fell by 13.4 percent or more than 7,800 jobs. Manufacturing’s share of total regional employment fell from 15.7 percent to 11.9 percent in this period (Exhibit 2).
Exhibit 2: Manufacturing Employment and Manufacturing Share of Total Employment, 2001 to 2019, Upper East Region
| Year | Total Industry Jobs | Manufacturing Jobs | Manufacturing Share of Total Industry Jobs |
|---|---|---|---|
| 2001 | 374,120 | 58,569 | 15.7% |
| 2002 | 374,437 | 55,838 | 14.9% |
| 2003 | 375,145 | 54,841 | 14.6% |
| 2004 | 380,350 | 55,377 | 14.6% |
| 2005 | 388,854 | 55,816 | 14.4% |
| 2006 | 397,088 | 57,062 | 14.4% |
| 2007 | 407,187 | 56,681 | 13.9% |
| 2008 | 413,393 | 55,338 | 13.4% |
| 2009 | 398,561 | 46,562 | 11.7% |
| 2010 | 398,620 | 44,341 | 11.1% |
| 2011 | 404,288 | 45,304 | 11.2% |
| 2012 | 408,424 | 44,556 | 10.9% |
| 2013 | 411,753 | 44,825 | 10.9% |
| 2014 | 416,813 | 47,444 | 11.4% |
| 2015 | 418,574 | 48,068 | 11.5% |
| 2016 | 417,310 | 47,278 | 11.3% |
| 2017 | 416,591 | 46,944 | 11.3% |
| 2018 | 421,346 | 48,787 | 11.6% |
| 2019 | 427,235 | 50,748 | 11.9% |
Sources: JobsEQ and Texas Comptroller of Public Accounts
The region recovered some manufacturing jobs between 2009 and 2019, adding nearly 4,200 jobs, a 9 percent increase. By comparison, Texas and U.S. manufacturing jobs rose by 8 percent and 8.2 percent, respectively (Exhibit 3). The region’s manufacturing employment rose sharply between 2017 and 2019, led by gains in food manufacturing, fabricated metals and transportation equipment.
Exhibit 3: Percentage Change in Manufacturing Jobs, 2009 to 2019 (Indexed to 2009)
| Year | Upper East Region Jobs | Upper East Region Percent Change | Texas Jobs | Texas Percent Change | USA Jobs | USA Percent Change |
|---|---|---|---|---|---|---|
| 2009 | 46,562 | 0.0% | 841,353 | 0.0% | 11,854,159 | 0.0% |
| 2010 | 44,341 | -4.8% | 814,265 | -3.2% | 11,532,264 | -2.7% |
| 2011 | 45,304 | -2.7% | 840,195 | -0.1% | 11,748,311 | -0.9% |
| 2012 | 44,556 | -4.3% | 867,771 | 3.1% | 11,950,974 | 0.8% |
| 2013 | 44,825 | -3.7% | 877,534 | 4.3% | 12,040,273 | 1.6% |
| 2014 | 47,444 | 1.9% | 890,468 | 5.8% | 12,202,119 | 2.9% |
| 2015 | 48,068 | 3.2% | 881,291 | 4.7% | 12,339,571 | 4.1% |
| 2016 | 47,278 | 1.5% | 848,235 | 0.8% | 12,345,948 | 4.1% |
| 2017 | 46,944 | 0.8% | 854,385 | 1.5% | 12,456,179 | 5.1% |
| 2018 | 48,787 | 4.8% | 882,339 | 4.9% | 12,696,998 | 7.1% |
| 2019 | 50,748 | 9.0% | 908,801 | 8.0% | 12,828,307 | 8.2% |
Sources: JobsEQ and Texas Comptroller of Public Accounts
Between 2009 and 2019, the Upper East Region lost 13 manufacturing establishments, a 1.1 percent decrease, compared to gains of 9.4 percent in Texas and 1.1 percent in the U.S. (Exhibit 4).
Exhibit 4: Total Manufacturing Establishments in Upper East Region, 2009 to 2019
| Year | Upper East Region (total) | Upper East Region | Texas | USA |
|---|---|---|---|---|
| 2009 | 1,207 | 0.0% | 0.0% | 0.0% |
| 2010 | 1,174 | -2.7% | -1.4% | -2.5% |
| 2011 | 1,173 | -2.8% | -1.6% | -4.0% |
| 2012 | 1,167 | -3.3% | -1.9% | -4.7% |
| 2013 | 1,159 | -4.0% | -2.0% | -4.7% |
| 2014 | 1,144 | -5.2% | -1.4% | -3.9% |
| 2015 | 1,152 | -4.6% | 0.4% | -3.0% |
| 2016 | 1,173 | -2.8% | 1.7% | -2.2% |
| 2017 | 1,195 | -1.0% | 3.8% | -1.3% |
| 2018 | 1,191 | -1.3% | 5.7% | 0.0% |
| 2019 | 1,194 | -1.1% | 9.4% | 1.1% |
Sources: JobsEQ and Texas Comptroller of Public Accounts
The region’s manufacturing jobs paid average wages of $54,135 in 2019, less than the Texas and U.S. averages. Between 2009 and 2019, its average wages rose by 24.2 percent, versus 32 percent in Texas and 27.4 percent in the U.S. (Exhibit 5).
Exhibit 5: Average Wages in Manufacturing Jobs, 2009 to 2019
| Year | Upper East Region | Texas | USA |
|---|---|---|---|
| 2009 | $43,578 | $60,401 | $54,939 |
| 2010 | $45,404 | $63,310 | $57,595 |
| 2011 | $47,501 | $66,075 | $59,277 |
| 2012 | $50,068 | $68,491 | $60,553 |
| 2013 | $51,591 | $68,838 | $61,143 |
| 2014 | $52,237 | $71,171 | $63,024 |
| 2015 | $51,814 | $72,815 | $64,352 |
| 2016 | $50,541 | $73,125 | $64,922 |
| 2017 | $52,043 | $75,806 | $66,898 |
| 2018 | $53,990 | $77,647 | $68,585 |
| 2019 | $54,135 | $79,746 | $69,976 |
Sources: JobsEQ and Texas Comptroller of Public Accounts
The manufacturing sector’s GDP value for the Upper East Region decreased by an inflation-adjusted 3.2 percent between 2009 and 2019, for an average annual decrease of 0.3 percent. In Texas and the U.S., by comparison, the sector’s average annual GDP rose by 2.6 percent and 1.9 percent, respectively (Exhibit 6).
Exhibit 6: Percentage Change in Real Gross Domestic Product, Manufacturing, 2009 to 2019 (Indexed to 2009)
| Year | Upper East Region | Texas | USA |
|---|---|---|---|
| 2009 | 0.0% | 0.0% | 0.0% |
| 2010 | -10.7% | 10.8% | 5.4% |
| 2011 | -12.8% | 15.0% | 5.8% |
| 2012 | -16.3% | 10.9% | 5.1% |
| 2013 | -13.4% | 23.3% | 8.3% |
| 2014 | -19.9% | 11.3% | 10.2% |
| 2015 | -18.8% | 15.0% | 11.7% |
| 2016 | -16.1% | 11.7% | 10.9% |
| 2017 | -13.1% | 18.2% | 13.7% |
| 2018 | -6.4% | 24.4% | 18.5% |
| 2019 | -3.2% | 29.7% | 20.8% |
Note: Due to GDP data withheld to avoid disclosure of confidential information, the analysis excludes the Upper East Region counties of Camp, Delta and Franklin.
Sources: U.S Bureau of Economic Analysis and Texas Comptroller of Public Accounts
Pandemic Effects
All Texas industry sectors have been affected by the pandemic to some degree, and manufacturing is no exception. Monthly jobs data show that manufacturing employment in the Longview metropolitan area was 600 positions or 6.3 percent lower in February 2021 than in the same month of the previous year. In the Tyler metropolitan area, however, manufacturing employment rose by 200 positions or 2.9 percent. Manufacturing employment also declined in Texas (-6.0 percent) and the U.S. (-4.1 percent) during this period (Exhibit 7.)
Exhibit 7: Changes in Manufacturing Jobs, February 2020 to February 2021
| Metro Area | Manufacturing Jobs | Percent Change (Manufacturing) | Percent Change (Total Employment) |
|---|---|---|---|
| Longview | -600 | -6.3% | -6.8% |
| Texarkana | -100 | -1.8% | -4.2% |
| Tyler | 200 | 2.9% | -2.6% |
| Texas | -54,200 | -6.0% | -4.6% |
| United States | -524,000 | -4.1% | -6.0% |
Source: Texas Workforce Commission
Note: Not seasonally adjusted
Key Manufacturing Industries
The interactive Exhibit 8 reveals regional manufacturing industry strengths and weaknesses through the use of two common analytical tools that compare regional manufacturing employment trends to national averages. These tools serve as an educational resource to assess industry strengths and inform development prospects.
First, the location quotient (LQ) measures state and regional industry concentration levels by comparing an industry’s share of total regional employment to its share of total national employment. If the regional industry share exceeds the national share (an LQ greater than 1.00), the industry is more “concentrated” in the region than nationally. A score above 1.00 may indicate that the regional industry is strong and self-sufficient and that it exports its products or services beyond the region. Regional industries with below-average employment concentrations (LQs of less than 1.00) often import goods or services from other areas.
A second tool, shift-share analysis (SSA), measures regional industry job changes and assesses the role of local competitiveness on industry job gains or losses. The SSA uses national employment and industry trends to produce expected employment changes for a regional industry. If a regional industry’s actual employment changes exceed expected changes (a positive local competitiveness effect), the region may have a productive advantage in the industry. Conversely, a negative competitiveness effect indicates that the industry fell short of expected employment changes.
Notably, an industry’s competitive effect value does not always follow its total employment changes. For example, an industry could gain jobs but still have a negative competitiveness value if the region fails to meet employment expectations. Between 2009 and 2019, total regional manufacturing rose by 9.0 percent (4,186 jobs), but SSA shows the region fell short of expected manufacturing gains by more than 824 jobs.
The Upper East Region’s manufacturing industries plotted in the exhibit fall into one of four quadrants based on 2019 LQ values and SSA values between 2009 and 2019:
- Strong and growing: Industry has above-average concentration levels (2019 LQ value > 1.00) and industry job changes exceeded expected changes between 2009 and 2019 (positive competitiveness effect);
- Strong but declining: Industry has above-average concentration levels (2019 LQ value > 1.00) and industry job changes fell below expected changes between 2009 and 2019 (negative competitiveness effect);
- Weak but growing: Industry has below-average concentration levels (2019 LQ value < 1.00) and industry job changes exceeded expected changes between 2009 and 2019 (positive competitiveness effect); and
- Weak and declining: Industry has below-average concentration levels (2019 LQ value < 1.00) and industry job changes fell below expected changes between 2009 and 2019 (negative competitiveness effect).
Manufacturing is heavily concentrated in the Upper East Region. Its LQ in 2019 was 1.32, meaning its share of regional employment was about 32 percent higher than the sector’s nationwide share. A wide variety of manufacturing industries had an above-average presence in the region in 2019, including food, transportation equipment, wood products, paper, chemicals, petroleum products, machinery and primary and fabricated metals. Several of these industries are closely tied to the region’s strong energy and mining sector.
Among these core industries, several surpassed employment expectations between 2009 and 2019 according to SSA calculations, led by food manufacturing, paper, furniture products, fabricated metals and railroad rolling stock. Machinery manufacturing jobs, however, fell by 2,249 jobs or 33 percent during this period. This loss occurred in the region despite industry gains in Texas and the U.S. SSA calculations show the regional industry fell short of employment expectations by 3,012 jobs.
Some regional industries with below-average concentrations (notably beverage products and pharmaceutical and medicine manufacturing) did exceed employment expectations. Such developments could identify emerging industries and prospects for further growth in the region.
A note of caution: A positive competitive effect indicates that some economic advantages exist in a region, such as access to natural resources or to a more productive labor pool, management or technologies. The sources of these advantages, however, cannot be identified through SSA.
Exhibit 8: Manufacturing Industries in the Upper East Region, Concentration Levels and Competitiveness
| Industry Title | NAICS | Employment, 2019 | Location Quotient, 2019 | Employment Changes due to Local Competitiveness, 2009-2019 |
|---|---|---|---|---|
| Food Manufacturing | 311 | 10,751 | 2.19 | 998 |
| Beverage and Tobacco Product Manufacturing | 312 | 672 | 0.78 | 456 |
| Textile Mills | 313 | 41 | 0.13 | 26 |
| Textile Product Mills | 314 | 404 | 1.20 | 50 |
| Apparel Manufacturing | 315 | 193 | 0.59 | -17 |
| Leather and Allied Product Manufacturing | 316 | 126 | 1.52 | 69 |
| Wood Product Manufacturing | 321 | 3,261 | 2.67 | -326 |
| Paper Manufacturing | 322 | 2,521 | 2.30 | 182 |
| Printing and Related Support Activities | 323 | 461 | 0.36 | 1 |
| Petroleum and Coal Products Manufacturing | 324 | 744 | 2.19 | 117 |
| Chemical Manufacturing (Resource-Intensive Commodities) | 3251-3253 | 2,160 | 2.54 | 33 |
| Pharmaceutical and Medicine Manufacturing | 3254 | 485 | 0.53 | 132 |
| Chemical Manufacturing (Locally Processed Goods) | 3255-3259 | 628 | 0.80 | 37 |
| Plastics and Rubber Products Manufacturing | 326 | 1,594 | 0.73 | -820 |
| Nonmetallic Mineral Product Manufacturing | 327 | 1,287 | 1.03 | -184 |
| Primary Metal Manufacturing | 331 | 1,829 | 1.58 | -226 |
| Fabricated Metal Product Manufacturing | 332 | 7,811 | 1.75 | 136 |
| Machinery Manufacturing | 333 | 4,576 | 1.36 | -3,012 |
| Computer and Electronic Product Manufacturing | 334 | 575 | 0.18 | -181 |
| Electrical Equipment, Appliance, and Component Manufacturing | 335 | 690 | 0.57 | 183 |
| Motor Vehicle, Body, and Parts Manufacturing | 3361-3363 | 4,424 | 1.48 | 296 |
| Aerospace Product and Parts Manufacturing | 3364 | 142 | 0.09 | 44 |
| Other Transportation Equipment Manufacturing | 3365-3369 | 1,543 | 2.14 | 416 |
| Furniture and Related Product Manufacturing | 337 | 1,801 | 1.56 | 546 |
| Medical Equipment and Supplies Manufacturing | 3391 | 1,158 | 1.19 | -16 |
| Other Miscellaneous Manufacturing | 3399 | 870 | 0.99 | 235 |
| Total - Manufacturing | 50,748 | 1.32 | -824 |
Sources: JobsEQ and Texas Comptroller of Public Accounts
Summary
Manufacturing employment in the Upper East Region rose by 9 percent (4,186 jobs) between 2009 and 2019, about on par with Texas and the U.S. Most of this job growth occurred between 2017 and 2019, adding more than 3,800 jobs. During the COVID-19 restrictions of 2020, manufacturing employment declined in the Longview and Texarkana MSAs but rose in the Tyler MSA.
Manufacturing is highly consequential to the Upper East region and has strong ties to its energy and mining sector. The region’s manufacturing base is also highly diversified, with high levels of concentration across a wide array of industries, from food products to petrochemical products to machinery and transportation equipment.