Wednesday, May 10, 2017

Job Creation in the Manufacturing Revival

"The health of the U.S. manufacturing sector is of ongoing interest to Congress. Numerous bills aimed at promoting manufacturing are introduced in each Congress, often with the stated goal of creating jobs. Implicit in many of these bills is the assumption that the manufacturing sector is uniquely able to provide well-paid employment for workers who have not pursued education beyond high school.

U.S. manufacturing output has risen approximately 22% since the most recent low point in 2009, but almost all of that expansion occurred prior to the end of 2014. The upswing in manufacturing activity has resulted in only relatively modest growth of employment in the manufacturing sector. Although a variety of forces seem likely to support further growth in domestic manufacturing output over the next few years, including higher labor costs in the emerging economies of Asia and increased concern about disruptions to transoceanic supply chains, evidence suggests that such a resurgence would lead to relatively small job gains within the manufacturing sector. Manufacturing wages are below those in many other industries and continue to decline in relative terms. Data taking insurance, pensions, and other employee benefits into account indicate that production workers have experienced a decline in average total compensation relative to comparable full-time workers in other occupations over the past decade...."
Jobs and manufacturing

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