This research work examined the empirical relationship between the Manufacturing sector and Economic Growth in Nigeria for the period 1990 to 2013 using ordinary least square method to ascertain the relationship between manufacturing, its components and economic growth. The results show that the output of the manufacturing sector contributed negatively and had an insignificant relationship to real gross domestic product growth, which was indicative of the fact that the manufacturing sector of the Nigerian economy is presently experiencing decay as a result of non-implementation of policies aimed at boosting the sector; the average manufacturing capacity utilization rate contributed positively and had a significant relationship to real gross domestic product growth; the exchange rate and interest rate did not contribute to real gross domestic product growth, which shows a sign of macroeconomic instability; the inflation rate contributed positively to real gross domestic product growth but, the insignificant nature of the inflation rate was indicative of the fact that the inflation in the Nigerian economy is not properly managed; government expenditure was significant indicating that the expenditure made by the government in the Nigerian economy was adequate but not properly managed, but nevertheless, contributed positively to economic growth. The study therefore, suggests that there should be an increase in government expenditure and proper management of the expenditure on manufacturing sector to ensure stable growth in the economy; there should be promotion of financial institutions to cater for the creation of funds for the manufacturing sector; there should be a reduction in interest rate to encourage more investment in the economy which will boost the economic growth of Nigeria; there should be a moderation in exchange rate to encourage investments thereby ensuring stability in the economic growth of Nigeria and; improving in the productivity of the manufacturing sector by upgrading its technologies.
Keywords:Manufacturing, Economic growth, Government Expenditure, Inflation, Policies, Nigeria.