US Manufacturing Rebounds on Strong Demand and Snagged Supply Chains

The pairing of outsize aggregate demand, especially for physical goods as opposed to services, with COVID-related shortages and constraints in the global supply chain has driven rapid price inflation for U.S. consumers. While that has caused a good deal of consternation, it is helpful to remember that one segment of the economy has benefited from these same rising prices: domestic manufacturers. The industry has for decades transitioned away from labor as its primary input and towards capital, including machinery, technology and computerization.