Economics Without The B.S.**:
Manufacturing Employment In Decline?
The number of people employed in the manufacturing sector of our economy has been in decline for decades and experts point to this trend as if it will continue forever. I read Race Against The Machine and enjoyed it — and I do believe that this is a trend. Never the less, high-tech and medium-tech manufacturing make up only one-third of manufacturing at the present time. Low tech manufacturing still predominates and we have many workers with poor skills who can fill these low-tech jobs and get paid a lot better than they would in the consumer economy we have. Also, the authors fail to account for all the jobs that manufacturing has related to the manufacturing process that don’t appear on the shop floor or in the manufacturing facility itself — many engineering jobs, technician jobs, blue-collar jobs, etc., etc. Not to mention all the other sectors in our economy that are affected by the manufacturing sector — energy, transportation and logistics, computer services and applications, servicing the manufacturing plant and equipment and supply businesses, etc., etc.
Manufacturing is approximately 10% of our economy and could easily be a lot more (maybe 25%) — we have a lot of capacity that has never been developed since the 1990′s. Let’s invest in this infrastructure. Our military readiness depends on a home-grown manufacturing sector better than sourcing off-shore and our military needs people within their ranks (civilian and military) who have the technical know-how that comes from an emphasis on manufacturing technology (i.e., making things as opposed to selling things). And, if we manufactured more, it would improve our exports and the large deficit in our current account/trade balance (which I think is running around $525 billion this year). I could go on and on; but, you can go on to other posts on my blog.
In discussing the trendline decline in manufacturing over the decades, “experts” like to compare it to the agricultural revolution at the turn of the century at 1900, when during the 19th Century most Americans made their living related to agriculture and by the beginning of the 20th Century only a small minority of farmers were feeding a continental nation that had grown a lot bigger. This comparison with the agriculture industry is a good comparison in some respects to manufacturing. Farmers made up a large percentage of the workforce in the 1800′s but have been in decline ever since -- but producing more for domestic consumption and also making a big contribution to exports. Yet, there are still a lot of jobs/industry associated with food production and distribution (domestically and export) and the development of a mass market, not just domestically but internationally. And the scientific sector has been a lot more involved with the agriculture industry since WWII — chemicals, feed, plant research, constructing food for taste/shapes/appeal (the same food but for different nationalities), climate’s affect on plant management, pharmaceuticals for animals, etc.. etc.
Let’s not be short-sighted when it comes to manufacturing — listening to ‘experts’ who may never have worked in a manufacturing environment. The complacency that comes from status quo thinking is not serving a nation well that has always been forward-looking, accepting challenges, seizing opportunity, and venturing into unchartered enterprises.
