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Manufacturing is not dead in the United States. In fact, manufacturing output in the United States has doubled since 1984 So the U.S. still makes lots and lots and lots of stuff, and our manufacturing output overall has been rising. So what gives? Why do people think manufacturing is in decline?
Because manufacturing jobs have declined a lot. Some of this is the result of outsourcing to other countries. But a great deal more has been the result of technology and automation. Manufacturing productivity has improved by a factor of three over the last 40 years. This means that even though we make more stuff than we used to, we use fewer workers (and less time) to do it.
Technological change often leads to improvements in productivity that in turn lead to reductions in the workforce even as output is increasing. It’s not hard to see why when you really look.
This is a picture of an automobile assembly line in 1948:Photo credit:
This is an automobile assembly line today:Photo credit:
See the difference?
So this is a major reason why people think U.S. manufacturing has basically disappeared. Far fewer people have factory jobs than was the case decades ago. Some of this is because those jobs were sent to countries with lower labor costs. And some of that outsourcing was accelerated by trade deals like NAFTA. But robots take away far more jobs than Mexican or Chinese workers do.
The appearance of the collapse of manufacturing is fueled by the fact that there are many towns and communities in some parts of the U.S., especially the so-called “Rust Belt,” where the local factory was pretty much the sole employer for everyone who lived there. And when that factory closed or cut back on its workforce for one reason or another, the consequences were dire for the people living in those communities. And those people are, and have been, angry at the loss of their livelihood.
This is not really something new. In the second half of the 19th century, many farming communities were in decline, even as overall farm output was increasing. This was because of improvements in productivity as a result of first steam-powered and then internal-combustion powered tractors, mechanical reapers and harvesters, and other advanced tools and equipment that became available. In 1900, it took farm workers four hours to do the same job it took 60 hours to do 60 years earlier. This was devastating for many small rural communities, so much so that farmers organized into groups like the Grange, the Farmer’s Alliance and ultimately the Populist Party in the 1890s in an attempt to force the adoption of government policies they thought would revive their communities and improve their economic fortunes.
People in the Rust Belt are doing something similar today. They were waiting for someone like Trump to come along. Up until now, both parties had basically told them the jobs and the life they remembered from decades ago were gone forever. And they said this while pursuing policies that contributed to the loss of more industrial jobs. But then Trump arrived, and said that he would bring those jobs back, and would reject those policies, even though trade policy is not the biggest reason manufacturing jobs have declined, as I pointed out above. Here’s the thing, though; nobody will take you seriously if you say you’re going to make factories become less automated. Nobody believes this will happen. But if you say, “I’ll stop companies from moving jobs oversees and get them to bring jobs back,” well, that sounds at least potentially credible. It’s probably not realistic but it’s what people want to hear. It’s what people in those declining communities that depended on one local factory for their livelihood want to hear. They certainly do not want to hear that those jobs are never coming back.
But many of them simply are not.
None of this means that you cannot develop government policies that will promote the expansion of manufacturing. This is certainly something that should be achievable. But Trump is basically telling these declining manufacturing towns that he will restore them to their former glory and bring jobs flooding back to them.
So is that “out of touch”? Well, it’s not very realistic.
Many of those Rust Belt communities grew up during and immediately after World War II, when there was an unprecedented expansion of American industry. For years after the war, the U.S. had virtually unrivaled domination of the international market for complex manufactured products like cars, refrigerators, televisions… the leading industrial nations in the world aside from the U.S. had their industrial infrastructures gutted by the war. It took years for them to rebuild and then years more for them to overcome the competitive advantage the U.S. had developed from owning such a large share of the marketplace for so long — they had to overcome the inertia of customers just buying American products because that’s what they had done for so long. But by the late 1950s U.S. global market share was already declining as foreign competition had recovered from the war and its aftermath. This led to a gradual but steady decline in U.S. manufacturing jobs that has never really stopped. Some of this was declining market share for American products; some of it was the result of globalization and the shifting of jobs to countries with lower labor costs; most of it was the result of technology increasing productivity.
But in those communities that grew up around factories built to win the war, all people knew was that there were fewer and fewer jobs available for people who lived there. And as the factory jobs dwindled, the tax base for these communities shriveled up; property values dropped, schools and services declined, and young people who had any hope of a better life looked to move away as soon as they were old enough.
Trump is promising the people living in those communities that he can reverse all of that.
He almost certainly cannot. I don’t know if it’s right to call that “out of touch.” It might simply be that Trump doesn’t really understand why manufacturing jobs have declined. It may be that he understands just fine but he’s just saying what his audience wants to hear. Either way, he is either ignoring or denying the reality of rising U.S. manufacturing output. He’s focusing on raw numbers of jobs, and seems to be assuming that trade deals are the reason those jobs have declined, and seems also to be assuming that better deals or different deals or no deals at all would bring jobs back, and not just bring them back, but bring them back to the exact same places where they were lost over the past several decades.
It used to be that pretty much all car factories were in Michigan. Today some of the factories that once built cars in Michigan are closed. But there are factories that build cars in places like Tennessee that did not exist when Detroit was the center of the automotive world. There’s no guarantee that policies that actually could bring back some of those lost jobs would bring them back to the places where people are angry about having lost them in the past.
None of this is to say that it’s impossible to adopt policies that would promote an increase in manufacturing jobs in the U.S. Countries like Germany have promoted industrial policies that maintain a highly skilled manufacturing workforce who, because of their skill and education levels, cannot easily be outsourced to countries with low labor costs. The U.S. could certainly pursue such policies, focusing on promoting high-end and high-tech manufacturing and maintaining the highly educated workforce to support such jobs.
To an extent, this is what globalization is supposed to do; the low-skilled, low-paying jobs move to countries with low labor costs (and unskilled workforces) while the more complex manufacturing jobs (that pay more) remain in countries with more highly skilled and educated workforces. In the late 19th and early 20th centuries, textile manufacturing (clothing) was one of the largest segments of American industry. Today, nobody is calling for bringing textile manufacturing back to the U.S. from countries like Bangladesh, because the jobs pay too little for American workers to want them. And Americans don’t want to pay more for their clothes, so they really don’t want to see textile labor costs rise.
But even if the U.S. could develop the kind of educational and industrial policies to consistently promote the expansion of advanced manufacturing jobs as an overall share of the economy, that’s not going to help people in Rust Belt towns where the local auto parts factory closed 20 years ago and now the people living there feel like they have no hope for a better life. It’s these kinds of people who voted for Trump; they don’t want their communities to die. They don’t want to be told to move if they want to find a job. They don’t want to hear that their kids should leave town as soon as they are old enough. They want things to be the way they were in an idealized past.
And Trump has promised he can deliver that. Is that “out of touch”? Like I said, I don’t think that’s the best way of describing it. The most charitable term I could suggest might be “unrealistic.”
Is Trump out of touch for trying to bring manufacturing back to the US? originally appeared on Quora - the place to gain and share knowledge, empowering people to learn from others and better understand the world. You can follow Quora on Twitter, Facebook, and Google+. More questions:
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