Manufacturing Jobs

The article, Manufacturing Lost 3.4 Million Jobs Since 1998 [the broken link was removed], indicates “The increased output should lead to job recovery.” I doubt it. While it is true there is a correlation between output and jobs by far the most significant trend is more manufacturing output and fewer manufacturing jobs everywhere in the world. Like so many articles talking about manufacturing job losses in the USA this one could leave many readers thinking that the USA needs to gain back jobs lost to other countries (while in fact the USA has lost a lower percentage of manufacturing jobs than most all countries – including China – based on the latest data I have seen).

Focusing on manufacturing output and jobs and their importance to the economy makes sense. However, I think people need to update the model they use to set expectations of manufacturing job levels. And given a world in which no countries seem able to do gain manufacturing jobs, it seems more reasonable to expect a continuation of decreased jobs and increased output until that worldwide trend changes. If you want to focus on manufacturing jobs in the USA I think the realistic goals are decreasing the reduction in jobs (by supporting what is still by far the world’s dominant manufacturing economy).

I don’t see what theory is used to think the USA, or any other country, should expect increases in manufacturing jobs, given the experience of the last 20 years. I actually think it is possible we might see worldwide manufacturing jobs start to increase, but I would expect jobs to increase very slowly compared to manufacturing output, but increase nevertheless. However, I know of no evidence to point to that happening, so I can’t see a good case for expecting such a change given the strong trend in the other direction.

It is probably just my desire to see more good jobs available that leads me to hope that it will happen. The best case for such an outcome, is the increase in consumption of manufactured good in Asia will outpace the increase in productivity and therefore require more workers to meet the increased demand. I just don’t believe the demand in the USA, Europe or elsewhere will be great enough to exceed productivity gains.

Related: Global Manufacturing Data by Country – Manufacturing and the Economy – Lean manufactuirng methods