I cited in an earlier post a prediction that the adoption of robotics could add manufacturing jobs in the U.S. Recently released figures from the Bureau of Labor Statistics, however, show a predicted loss of 73,000 manufacturing jobs over the period from 2010 and 2020.
The Wall Street Journal explains what's happening to manufacturing jobs: “Real manufacturing output stood at about $35,000 per worker in 1947, in constant dollars. It doubled by 1980 as companies became more efficient. Today this measure is an astonishing $150,000. Manufacturing productivity has increased by 103% since the late 1980s, outpacing every other industry and double the 53% in the larger business economy.”
Writing in The Corner, Veronique de Rugy elaborates, “A key argument for encouraging manufacturing is to create jobs and reduce unemployment. There are many problems with this. The goal ignores the fact that unemployment today isn’t the result of the losses in manufacturing jobs. That decline has been going on for 30 years and has been largely made up for by gains in productivity.” She adds that preferential treatment won’t bring back the lost low-skill jobs.
Despite the jobs situation, The Journal contends that manufacturing is not the basket case that Democrats and Republicans are portraying in the presidential campaign and that manufacturing needs no special government help beyond a tax code with lower rates and fewer loopholes, a better education system, a reformed immigration policy, and fewer regulations.
In a letter to the editor in the Journal, Andrew N. Liveris, chairman and CEO of Dow Chemical Co., raises two issues in response: “First, by categorically casting all government involvement in industrial policy as untoward, you neglect the successful and critical role government has played in industry for decades.” He continues, “Second, you rightly champion the gains in industrial productivity achieved in the last 30 years, but you gloss over the impact this productivity has had on employment. These lost jobs are significant. Of the eight million jobs lost in the recession, two million were in manufacturing, which are higher-paying and intrinsically supportive of more employment in other sectors.”
Liveris concludes, “Dow operates manufacturing plants in the U.S. and around the world, and I see the ways we can collaborate, educate, and cooperate with government to drive innovation and increased competitiveness. It is time to recognize the issues, plan a steady and strategic path forward and to act.”
It seems unlikely the higher paying manufacturing jobs Liveris mentions will be coming back—just witness the decline in starting salaries for low-skilled workers in the automotive industry. If there is a bright spot, it's that the job prospects might improve for higher skilled workers. As Peter Whoriskey of the Washington Post reports from Holland, MI, “Unemployment hovers above 9 percent. Foreign competition has thrown many out of work. It is a platitude that this industrial hub, like the country itself, needs more manufacturing work. But as the 2012 presidential candidates roam the state offering ways to 'bring the jobs back,' many manufacturers say that, in fact, the jobs are already here. What’s missing are the skilled workers needed to fill them.”
I cited in an earlier post a prediction that the adoption of robotics could add manufacturing jobs in the U.S. Recently released figures from the Bureau of Labor Statistics, however, show a predicted loss of 73,000 manufacturing jobs 2010 and 2020.
The Wall Street Journal explains what's happening to manufacturing jobs: “Real manufacturing output stood at about $35,000 per worker in 1947, in constant dollars. It doubled by 1980 as companies became more efficient. Today this measure is an astonishing $150,000. Manufacturing productivity has increased by 103% since the late 1980s, outpacing every other industry and double the 53% in the larger business economy.”
Writing in The Corner, Veronique de Rugy elaborates, “A key argument for encouraging manufacturing is to create jobs and reduce unemployment. There are many problems with this. The goal ignores the fact that unemployment today isn’t the result of the losses in manufacturing jobs. That decline has been going on for 30 years and has been largely made up for by gains in productivity.” She adds that preferential treatment won’t bring back the lost low-skill jobs.
Despite the jobs situation, The Journal contends that manufacturing is not the basket case that Democrats and Republicans are portraying in the presidential campaign and that manufacturing needs no special government help beyond a tax code with lower rates and fewer loopholes, a better education system, a reformed immigration policy, and fewer regulations.
In a letter to the editor in the Journal, Andrew N. Liveris, chairman and CEO of Dow Chemical Co., raises two issues in response: “First, by categorically casting all government involvement in industrial policy as untoward, you neglect the successful and critical role government has played in industry for decades.” He continues, “Second, you rightly champion the gains in industrial productivity achieved in the last 30 years, but you gloss over the impact this productivity has had on employment. These lost jobs are significant. Of the eight million jobs lost in the recession, two million were in manufacturing, which are higher-paying and intrinsically supportive of more employment in other sectors.”
Liveris concludes, “Dow operates manufacturing plants in the U.S. and around the world, and I see the ways we can collaborate, educate, and cooperate with government to drive innovation and increased competitiveness. It is time to recognize the issues, plan a steady and strategic path forward and to act.”
It seems unlikely the higher paying manufacturing jobs Liveris mentions will be coming back—just witness the decline in starting salaries for low-skilled workers in the automotive industry. If there is a bright spot, it's that the job prospects might improve for higher skilled workers. As Peter Whoriskey of the Washington Post reports from Holland, MI, “Unemployment hovers above 9 percent. Foreign competition has thrown many out of work. It is a platitude that this industrial hub, like the country itself, needs more manufacturing work. But as the 2012 presidential candidates roam the state offering ways to 'bring the jobs back,' many manufacturers say that, in fact, the jobs are already here. What’s missing are the skilled workers needed to fill them.”