Monday, April 23, 2012

Putting manufacturing "decline" in context.

Source: The Economist
This graph shows that as the Chinese and Indians have increased their share of world manufacturing, the shares held by the United States, Japan, Germany and Britain have gone down. Look at the following graph, however:
Source: Project America
Manufacturing in the United States in fact shows a long term trend of increasing contributions to GDP. Thus, American manufactures have been increasing production but Chinese and Indian manufacturers have been increasing theirs more rapidly.

Source: The American
This third graph shows that manufacturing is going down as a percentage of total production of goods and services in the United States and in the world as a whole. Once the change was from primary production (agriculture, forestry, fishing) to manufacturing. Today the change is to increase services, such as medical services, education and entertainment.

You have to be careful to understand what an apparently simple and straight forward graph actually means. It may be easy to lie with statistics, but it is easier still to lie with pictures.

No comments: