The US manufacturing sector consists of about 300,000 companies with combined annual sales of over $4 trillion. Major manufacturers include GM, Ford, Boeing, GE, IBM, Hewlett-Packard, Tyson Foods, Procter & Gamble, Pfizer, DuPont, and Caterpillar. Although fragmented into many industries served by numerous competitors, the manufacturing sector is concentrated at the top: the largest 50 companies produce more than 25 percent of total sales.
Demand ultimately depends on consumer spending, but changes in demand often are not felt immediately because most manufacturers make intermediate products. The profitability of individual companies depends on efficient production and distribution. Large companies often have large economies of scale in purchasing, production, and marketing. Small companies can compete effectively by producing specialized products. The industry is capital-intensive and highly automated: annual revenue per employee varies greatly due to the large variety of production operations but averages more than $350,000.
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