The position in the global value chain (GVC) is a critical criterion for evaluating industrial competitiveness. Solely using the upstreamness of the value chain to measure the division of labor in the GVC may lead to misjudgments. This paper analyzes the nonlinear relationship between the GVC position of the manufacturing industry and the sector’s input-output value-added rate. It constructs a value-added rate measurement and analysis framework based on a dichotomy approach, linking it to the industry’s GVC position level. The paper finds that the overall value-added rate of China’s manufacturing industry transitioned from being dominated by the upstream supply side in the first phase (2007~2013) to being dominated by the downstream demand side in the second phase (2013~2018). The industry heterogeneity analysis reveals that the upstream supply-side value-added rate in the refined petroleum products manufacturing industry (an upstream industry) drove the actual value-added rate upward. In the electronics information products manufacturing industry (a midstream industry), there is a significant contrast between the changes in the upstream supply-side value-added rate and the downstream demand-side value-added rate. In the automobile manufacturing industry (a downstream industry), both the upstream supply-side value-added rate and the downstream demand-side value-added rate show an upward trend. The measurement method constructed in this paper has theoretical innovation value for understanding the economic implications of the GVC position in China’s manufacturing industry.