Published: April 10, 2026

A recent analysis from the Economic Innovation Group (EIG) found that more than four-fifths of net manufacturing job growth since 2019 occurred in just 354 of the nation’s 3,143 counties.  Counties representing over 62% of pre-pandemic manufacturing employment saw zero or negative growth.  The post-pandemic manufacturing recovery was real, but it was narrow, and much of it is already fading.

Where are the gains holding?  Three broad regions stand out.  In the Southeast, Florida, Georgia, Alabama, and South Carolina account for roughly 36% of state-level manufacturing growth, anchored by aerospace and automotive clusters in places like Huntsville, Spartanburg, and Savannah.  Texas added more manufacturing jobs than any other state, spanning multiple industries around its four largest metros.  And in the Mountain West, Arizona, Nevada, Utah, and Idaho all recorded employment increases exceeding 8%, driven by semiconductor expansion under the CHIPS Act and EV-related production.

The EIG data points to a critical variable separating winners from the rest: dynamism.  Metro areas that sustained growth into 2025 had higher manufacturing startup rates, more young firms, and stronger establishment entry rates before the pandemic.  It was not legacy infrastructure that predicted resilience.  It was entrepreneurial capacity and firm formation.

That finding matters for everyone in manufacturing, but for workforce and economic development professionals focused on the defense industrial base, the implications deserve a closer look.

Defense manufacturing has its own geography, and it does not map neatly onto the commercial manufacturing landscape.  Research from the Nowak Metro Finance Lab at Drexel University has tracked the spatial distribution of high-value DoD contracts (those exceeding $500 million from FY2021 through FY2024) and found $340 billion concentrated across just 41 metropolitan areas.  Dallas-Fort Worth alone captured $71 billion in defense manufacturing investment across 27 large contracts and modifications, driven by Lockheed Martin, Bell Textron, and a supporting ecosystem of mid-tier suppliers.  New York-Newark and Seattle-Tacoma round out the top three.  The concentration of defense contract spending is, if anything, even more pronounced than the concentration EIG found in broader manufacturing employment.

The workforce constraints are different too.  According to PwC and the Aerospace Industries Association, nearly a quarter of the aerospace and defense workforce is already at or beyond retirement age.  Attrition hit 13% in 2023, well above the U.S. manufacturing average.  And unlike most commercial manufacturing roles, defense positions increasingly require security clearances.  The number of clearance-required jobs has grown dramatically over the past decade, while the pool of cleared workers has not kept pace.  That bottleneck compounds every other hiring challenge defense manufacturers face.

So when EIG tells us that dynamism, not legacy, drives sustained manufacturing growth, the defense sector has to read that finding through a different lens.  Startup rates and new firm entry are important, but the defense industrial base also depends on long contract cycles, specialized certifications, and supplier relationships that take years to develop.  A metro area can attract a new commercial manufacturer relatively quickly if the business climate and workforce are right.  Building a defense supplier ecosystem is a slower, more deliberate process.

This does not mean the EIG findings are irrelevant to defense communities.  The opposite is true.  Bruce Katz at the Nowak Lab has argued that organized communities can reap a substantial “defense dividend” by using military spending to move up the value chain, becoming hubs for supply chain firms, energy innovation, and technology development.  But capturing that dividend requires more than general manufacturing readiness.  It requires workforce pipelines tuned to defense-specific needs, regional coordination between large primes and smaller suppliers, and a long-term investment posture that matches the multi-year rhythms of defense procurement.

For the regions where both commercial and defense manufacturing are growing, places like Huntsville, Dallas-Fort Worth, and parts of the Mountain West corridor, the opportunity is significant.  These are communities where commercial dynamism and defense investment can reinforce each other.  For legacy manufacturing regions losing ground on the commercial side, the defense industrial base may represent a more durable anchor, but only if they build the specialized workforce and supplier infrastructure to compete for it.

The bottom line for workforce and economic development professionals: general manufacturing data tells part of the story.  Defense manufacturing tells a different, and often more demanding, part.  Understanding both is essential for regions that want to stay in the game.