All Things Political

Chemical Industry Job Outlook

supplemental resource: Job Outlook by Profession

Employment is projected to decline rapidly, and applicants for jobs are expected to face keen competition.

Although output is expected to grow, wage and salary employment in the chemical manufacturing industry, excluding pharmaceuticals, is projected to decline by 13 percent over the 2008-18 period, compared to 11 percent growth projected for all industries combined. The expected decline in employment can be attributed to trends affecting the U.S. and global economies. A number of factors will influence chemical industry employment, including technological advances that have enabled plant automation and more efficient chemical processes that have affected the production process, the state of the national and world economy, company mergers and consolidation, increased foreign competition, the shifting of production activities to foreign countries, and environmental health and safety concerns and legislation. Another trend in the chemical industry is the rising demand for specialty chemicals. Chemical companies are finding that, in order to remain competitive, they must differentiate their products and produce specialty chemicals, such as advanced polymers and plastics designed for customer-specific uses—for example, a durable body panel on an automobile.

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Improvements in production technology have reduced the need for workers in production; installation, maintenance, and repair; which account for large proportions of jobs in the chemical industry. Sophisticated machines with computerized controls have replaced some workers in standard production. With automation manufacturers can increase accuracy and decrease time and labor costs, thus contributing to increased production efficiency. Although production facilities will be easier to run with the increased use of computerized controls, the new production methods will require workers with a better understanding of the systems.

It is important for firms to improve their bottom line. Pressure to reduce costs and streamline production will result in mergers and consolidations of companies both within the United States and abroad. Mergers and consolidations are allowing chemical companies to increase profits by eliminating duplicate tasks and departments and shifting operations to locations in which costs are lowest. U.S. companies are expected to move some production activities to developing countries—in East Asia and Latin America, for example—to take advantage of rapidly expanding markets.

The volatility of inputs like crude oil and natural gas prices impact the chemical manufacturing industry. Likewise, prices of chemical feedstocks—like ethane or propane, which are used to produce petrochemicals, plastics, fertilizers, and other products— can be unstable. In response, prices for chemical products must fluctuate and so does demand for chemical products. If prices of such inputs are continually high, demand will be low for chemical products and manufacturer will need to employ fewer workers; the opposite would occur if inputs are continually low priced.

Increasing interest in going "green" throughout the U.S. may affect the chemical manufacturing industry. For example, there are efforts to reduce the amount of emissions the U.S. produces. As manufacturers have limits imposed on their emissions, the cost of producing chemical products will rise, likely reducing demand. Also, many localities are considering restrictions on the use of plastic shopping bags, a product of the chemical manufacturing industry.

The factors influencing employment in the chemical manufacturing industry will affect different segments of the industry to varying degrees. Only one segment—paint, coating, and adhesive products segment—is projected to grow. The remaining segments are projected to lose jobs.

Individuals seeking employment in the chemical manufacturing industry are expected to face keen competition, particularly those seeking to enter the industry for the first time. For production jobs, opportunities will be best for those with experience and continuing education. For professional and managerial jobs, applicants with experience and an advanced degree should have the best prospects. In addition, some job opportunities will arise from the need to replace workers who transfer to other occupations or who retire or leave the labor force for other reasons.

Source: Bureau of Labor Statistics, U.S. Department of Labor, Career Guide to Industries, 2010-11 Edition

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