TRADE GROWTH VS MANUFACTURING EMPLOYMENT

One of the big myths believed by many workers is that their jobs are being lost overseas.  Well, some of it is, but most is lost through technological improvements.  This is hardly a mystery as a CNBC article points out.*

Although free trade can lead to some job displacement, associating it with all manufacturing job loss is too simplistic. Since the mid-20th century, as Figure 1a shows, U.S. manufacturing productivity has experienced impressive growth because of technological advances.⁴ As with trade, technology has also contributed to manufacturing job losses. In fact, 87 percent of the job loss in the first decade of the 21st century stemmed from technology (Figure 1b).⁵ The mass U.S. adoption of technology has especially transformed the manufacturing industry by increasing each worker's productivity by more than five times since the 1950s. Today, the average autoworker can make 18 cars a day, compared with 13 in 1990*.

(Click on figure to enlarge

The U.S. Bureau of Labor Statistics presents a figure on total employment going back to 2007.  As can be seen from their figure below, manufacturing employment has been in a general upswing since it bottomed in 2010.**  Manufacturing employment reached a peak of 19,553 million in June of 1979 and began a gentle decline.

In August of 2000 when manufacturing employment had declined to 17.287 million workers, the decline steepened (see fig. below)  The decline flattened at the beginning of 2004 when manufacturing employment was at 14,332 million, but then steepened again when manufacturing employment was at 14,213 million in June of 2006.

Forecasting the Great Recession by a bit, manufacturing employment began a waterfall-like decline with employment at 13,746 in March of 2006  and bottomed at 11,453 million manufacturing employees in February of 2010.  Since then during the Obama administration, manufacturing employment began a slow rise that has continued into 2017, the beginning of the Trump Administration, with 12,481 million manufacturing employment jobs as of October 2017 for an increase of about a million manufacturing jobs since February of 2010.

* https://www.cnbc.com/advertorial/2017/10/20/what-your-clients-need-to-know-about-trade-deficits.html
** https://fred.stlouisfed.org/series/MANEMP