The decline in the number of manufacturing jobs in the United States

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Over the last 40 years there has been a huge decline in the number of manufacturing jobs in the United States especially in what was once the great industrial heartland of America that extended from the northeastern states of New York and New Jersey across through Pennsylvania, Ohio, Indiana, Michigan, and Wisconsin. The result of this great decline, the closure of factories, has created what has been called the American “rust belt”. What happened? Why did it happen? One reason it happened had to do with labor unions. Labor unions forced wages so high that manufacturers abandoned their factories and moved to places where labor was cheaper such as the American south (where there were no labor unions) and countries such as China or Mexico. Another reason for the great decline in American manufacturing jobs is automation, computers, and the use of robots. And a third reason has to do with the reduction or erasure of tariffs and trade barriers as part of the process of “globalization”. If one erases all tariffs and trade barriers between countries what would one expect to happen? He would expect manufacturers to move to countries where the cost of production was cheapest (such as China) where they can compete best. If, in addition to this, you have gigantic retail companies such as Walmart and Target, who represent such a gigantic portion of the retail market, going over to low wage countries like China and aggressively negotiating with all of the various competing manufacturers of a particular item for the very lowest price — and following this procedure on each and every item they sell — what would one expect the effect to be? It means very good prices for the consumer here in the USA. But it also means that American manufacturers go out of business because they can’t compete with Chinese manufacturers. And it means that the Chinese economy booms while the American economy stagnates.

We all like good prices. What is more important to a country — good prices or good, well paying jobs? Sometimes one cannot have everything.

What is more important to the people of a country than an abundance of good, well paying jobs? Most manufacturing jobs are peopled by the unskilled or semi-skilled. In the decline of manufacturing jobs it is the unskilled and semiskilled who have been hurt the most.

Donald Trump campaigned on the promise of making America great again by bringing manufacturing jobs back to America and gained a lot of enthusiastic supporters. Well, I was never clear on just how he was planning to do that. You could probably do it by trade barriers and tariffs but that would increase the price of goods. There would be a cost to doing it.

Thirty or forty years ago there was a period in England where they had a surplus of chemists. At that time I read about a fellow who had a PhD in chemistry who was working in a carwash in England washing cars. It must be very discouraging to find oneself washing cars for a living after one has spent a huge amount of time, money and effort to get a PhD degree in Chemistry. Chemistry is a difficult subject. Back in the early 1970's my wife and I were on vacation in Mexico City and took a taxi to see the Aztec ruins of Teotihuacan about 25 miles outside the city. I remember the taxi driver said he had a PhD degree in economics. I thought it was very sad that someone with a PhD degree would be reduced to driving a taxi. Life can be rough. It can be brutal. That is a fact. Hope you are not one of the unlucky ones.

We live in a highly specialized world in which there are tens of thousands of specialized jobs that require special training. And our world is one of constant flux, constant change where the number of vacancies in a particular speciality changes on a daily basis. New technologies come and others go. The blacksmith is replaced by the automobile mechanic. Jobs are made obsolete by automation. One can spend a huge amount of time, money and effort on an education in a particular speciality and then be unable to find a job because there is an oversupply of people in that speciality. I don’t know what can be done about this. I don’t know any way to eradicate danger, risk, harm, and injustice from life. I don’t think there is any way. Danger is a harsh fact of life. Life can bang people around, traumatize them. Liberals are never going to come up with some utopian social system that takes all of the injustice out of life. Harshness and injustice is part of all systems, partly because of the nature of man himself.

29 Aug 2022