Industrial Insight

healthy manufacturing but fewer jobs… | March 23, 2013

What this means is that the president’s campaign plan to revive America’s labor force with manufacturing employment almost certainly won’t work — leaving aside the fact that it’s also quite poor economic policy to encourage any particular sector, but least of all one that just happens to make people feel warm and patriotic.

In fact, while the president’s campaign promised “new jobs,” all we’re seeing … is the restoration of jobs lost in the 2008 recession, to the point where, even if the president’s promise comes true, the U.S. economy would only have as many manufacturing jobs as it did in November of 2008, when manufacturing employment was dropping dramatically — that is, we wouldn’t even have as many manufacturing jobs as we had before the recession. In fact, if Obama succeeds in reviving manufacturing like he promises above, manufacturing employment . . . won’t be revived: By the end of 2016, even if the million jobs are created, manufacturing employment will remain about 9 percent of U.S. private payrolls (if we assume the CBO’s overall payroll projections prove true), which is what it was at the beginning of the recovery.

Obviously, though, it’s possible manufacturing-job creation picks up at the same rate that it’s assumed general employment will, defying the above trend. But that trend holds true in recoveries, too: Manufacturing employment shrinks as a share of the economy consistently because it lags both during recessions, when it drops faster than general payrolls, and during recoveries, when it grows more slowly (blue is manufacturing, red is overall payrolls):

Advertisements

Posted in Uncategorized

Leave a Comment »

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

About author

I'm the executive vice president for a steel casting trade association, the Steel Founders' Society of America. I've got a crazy wife, five crazy children, three crazy people that married into the family, and two crazy fun little grandsons.

Search

Navigation

Categories:

Links:

Archives:

Feeds

%d bloggers like this: