Nothing Will Bring Back Manufacturing Employment

Moneybox
A blog about business and economics.
Nov. 19 2012 12:26 PM

Nothing Will Bring Back Manufacturing Employment

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You know all those good manufacturing jobs that have gone to Asia? Well, it turns out that they've been going to robots even more robustly. These McKinsey numbers about global manufacturing output and employment (via Neil Irwin) should do much more to inform the policy debate about national manufacturing policy in the United States.

The key point is that the world as a whole has been increasing its output of manufactured goods. There's more stuff than ever before. Americans have a little bit more stuff than we used to have, and the pace of goods acquisition has risen even faster in poor places like India and Brazil. But on net, global manufacturing employment declined from 1996-2006. Factory jobs were certainly added in China, but they weren't one-to-one displacing factory jobs in the West. Rather, the geographical shift in manufacturing employment is just a small ripple on the surface of the ocean—the big trend is simply toward more automation and more productivity.

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Which I think is fine.

If you think about what the typical American family needs more of, it's not manufactured goods. People need cures for illness and educational opportunities for their kids. They need more time to spend on leisure activities and with their family. They need jobs they enjoy. The idea of promoting more widespread affordability of health care services by boostering the share of the population that works in factories is a bizarre Rube Goldberg mechanism compared to directly focusing on improving the health care sector's ability to deliver useful treatment to people.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.

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