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Ain’t gonna happen

from David Ruccio

fredgraph

During the recent presidential campaign, Donald Trump promised to revitalize American manufacturing—and bring back “good” manufacturing jobs. So did Hillary Clinton.

What neither candidate was willing to acknowledge is that, while manufacturing output was already on the rebound after the Great Recession, the jobs weren’t going to come back.

As is clear from the chart above, manufacturing output has grown (by about 21 percent) since the end of the recession and is now nearing pre-recession levels (although still down from its pre-crash level by about 5 percent). But employment in the manufacturing sector is only up a small amount (8 percent) since its post-crash low and is still lower, by about 1.5 million jobs (or 11 percent), than in December 2007.  

So, even if manufacturing production continues to grow, manufacturing jobs won’t (at least at the same rate). That’s because productivity in manufacturing continues to increase—as employers decide to change work rules, reorganize the factories, and introduce robotics and other forms of automation. Manufacturing workers, in other words, are being forced to produce more with less.

fredgraph-1

That trend—of employment not matching the growth in output—just represents a longer term tendency in American manufacturing. If we start back in 1990 (as in the chart above, indexed to January 1990), output has increased 75 percent while employment has actually fallen by more than 30 percent.

fredgraph-2

And, of course, employers have made that situation work for themselves, especially in recent years. Since the crash, corporate profits in manufacturing have rebounded spectacularly.

As long as workers have no say in how production is organized—including the technologies that are used and the surplus that is created—we can expect both manufacturing production and profits to increase while leaving workers and their jobs behind.

No matter who the president is.

  1. Kautz, Frederick A
    December 28, 2016 at 5:30 pm

    Try again. There is nothing posted at the link provided in the message below form David Ruccio.

    Frederick Kautz

  2. Craig
    December 28, 2016 at 6:15 pm

    This is precisely why monetary gifting is so essential to be strategically integrated and implemented into the economic and monetary systems.

  3. December 28, 2016 at 8:05 pm

    “As long as workers have no say in how production is organized—including the technologies that are used and the surplus that is created—we can expect both manufacturing production and profits to increase while leaving workers and their jobs behind.”

    I am baffled. Increased output with fewer workers seems to describe an increase of productivity, the core of sustainable economic growth. It makes us richer because we can have everything we had before and we still have some labour left over to do other things we might like, like giving yoga classes or teaching economics.

    Yet the author seems unhappy. It seems he would prefer that manufacturing workers organise their production in such a way as to maximise making jobs rather than making things that people would like to buy. But why stop at how things were 10 years ago? I am reminded of that old anecdote attributed to Milton Friedman:

    “Milton recalled traveling to an Asian country in the 1960s and visiting a worksite where a new canal was being built. He was shocked to see that, instead of modern tractors and earth movers, the workers had shovels. He asked why there were so few machines. The government bureaucrat explained: “You don’t understand. This is a jobs program.” To which Milton replied: “Oh, I thought you were trying to build a canal. If it’s jobs you want, then you should give these workers spoons, not shovels.””

  4. Ian Murray
    December 29, 2016 at 5:37 am

    And to think there are plenty of economists who want us to consider McDonald’s as manufacturing:

  5. December 30, 2016 at 9:49 am

    Now that Mr. Trump is elected how will he bring back all the “lost” manufacturing jobs to the US? And if he fails in this, what will the consequences be for US politics and civil peace, as well as the future of US economics? Since there seems little chance he can succeed, can US democracy survive the failure. Or will the US collapse into a right-wing autocracy?

  6. merijntknibbe
    December 30, 2016 at 6:02 pm

    I’ve seen my share of factories, from lightbulb production to cheese and from cigarettes to the Sonac carcass destruction plant (which during the last 10 years actually developed into a genuine pharma plant, producing heparine…). And we’ve become amazing, extra-ordinary, mightboggling beyond imagination good at mass production. Look at this YouTube clip from a cigarette factory https://www.youtube.com/watch?v=lPCa1gfiw3I

    Same for agriculture, here is: Planet money makes a T-shirt, mind the cotton producer http://apps.npr.org/tshirt/#/title

    The Fred Flintstone economy is gone forever…

    • December 31, 2016 at 5:23 am

      merijntknibbe, what precisely is the “Fred Flintstone” economy? But you’re correct about how mindboggling we’ve become at mass production. It’s just that all this production involves few actual workers and the products produced often are of questionably moral and social value.

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