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Most U.S. manufacturing came back strongly this year. Nowhere was that more evident than across the Midwest. But even if it was a good year for industry, not all of the jobs lost during the recent recession returned.

Niala Boodhoo, of Changing Gears, has a story for our series A Good Year.

NIALA BOODHOO, BYLINE: Chicago White Metal Casting's CEO Eric Treiber is leading me onto his factory floor where workers are busy making small aluminum, zinc and magnesium metal parts.

ERIC TREIBER: Oh, they're making parts that'll go into cars, some parts that'll be used for a swimming pool. We're making components that'll go onto some farm equipment.

BOODHOO: It's a whole lot louder in here than it was a few years ago. Revenue is up four percent over 2010, which reflected an increase from 2009. Those numbers are being repeated at factories across the Midwest.

DR. BILL STRAUSS: We're seeing a great demand for some of the machinery that's made right here in the Midwest.

BOODHOO: That's Bill Strauss, a senior economist with the Federal Reserve Bank of Chicago. He's talking about not just small parts but cars, tractors mining equipment and steel. As the Fed measures it, Midwestern manufacturing has enjoyed 28 months of growth, at rates much better than the national average and the overall economy.

STRAUSS: The kind of goods that we produce here are very high-value added goods. You know, we have the Caterpillar 797B made here in the State of Illinois. It's the largest truck made in the world, weighing over a million pounds, costing, you know, in the neighborhood of seven, $8 million.

BOODHOO: Imagine how much steel goes into that.

So with all those orders, where are the jobs? During the recession, one out of every four jobs lost was in manufacturing; that's 2.3 million jobs. As of last November, though, just 308,000 had returned.

Why so few? Remember the mantra Produce More With less? Many manufacturers practically perfected that during this recession. Take Chicago White Metal Casting. Trieber says they had to be focused on productivity in order to keep up with overseas competition. So they updated machines, focused on staff training and improved quality control.

And Treiber is actually hiring. But he's looking for specialists like die cast machinists. And that's the problem right now with manufacturing. With better productivity, the need is for more skilled workers, not just machinists but welders, designers and most of all, people who know how to operate the new computerized machines on factory floors - CNC workers.

Economist Bill Strauss.

STRAUSS: What about those two million people that lost jobs? Can't you hire those back? And what you find out from people is that even though they were classified as being in manufacturing, many of them lacked the kind of skills that are required in this more 21st century manufacturing.

BOODHOO: Strauss says he's optimistic that the manufacturing sector will continue to do well in the coming year. But he also says it will need more workers who have the exact skills needed to do the new jobs.

For NPR News, I'm Niala Boodhoo in Chicago.

LYDEN: This is NPR News.

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