Friday, April 05, 2013

U.S. Manufacturing is strong, but the jobs are not there.

As the figure above shows, manufacturing output continues to increase in the United States, with occasional slowdowns due to recessions, but a clear long term trend.

On the other hand, as shown in this graph, manufacturing employment in the United States has been decreasing rapidly for a decade.

The answer in part is that U.S. manufacturing industry has used automation to remain competitive, substituting machines for people. Of course, it has also specialized in some high tech industries recognizing that China and other low wage countries will compete more effectively in labor intensive manufacture.

Like other developed countries, the manufacturing workforce is decreasing as a percentage of the total. That is due to the decrease in manufacturing employment and to the growth of the total workforce due to population growth.

No comments: