Paradoxish posted:

Manufacturing isn't "coming back" because it never actually went anywhere. We produce twice as much now as we did in the 70s with one third of the labor. A manufacturing boom would create a few tens of thousands of jobs at most, which is literally a drop in the bucket compared to the number of jobs the US economy produces every month. Even if all of those were high paying jobs, it wouldn't move actual wage growth one bit.

It can't be said enough that US manufacturing is not and has not been declining. US manufacturing is strong and has been strong for decades, we just don't need factory workers.

quote:

Don’t blame the robots! An interview on manufacturing, automation, and globalization with Susan Houseman.

By Jared Bernstein October 18, 2016
Jared Bernstein, a former chief economist to Vice President Biden, is a senior fellow at the Center on Budget and Policy Priorities and author of the new book 'The Reconnection Agenda: Reuniting Growth and Prosperity.'

Susan Houseman is a senior economist at the Upjohn Institute in Michigan. I’ve followed her work on employment trends, especially in manufacturing, for years, and wanted to share some of her recent findings that struck me as particularly germane at this point in time.

JB: This election has clearly elevated the view that our manufacturing sector, and the families and communities that have historically depended on it, has been hurt by trade. A countervailing view says it’s not trade, it’s automation that’s responsible for large-scale job losses. You’ve recently updated your very important work on this question. Does productivity in the manufacturing sector support the automation story?

SH: No, it doesn’t. To see why, consider where that story comes from. The simple automation story says that U.S. manufacturing is doing well and automation is behind the large job losses. At first blush, government data seem to support that story. Manufacturing output growth, adjusted for inflation, has been strong, rising almost as quickly as GDP. At the same time, employment in manufacturing, which previously had been pretty stable, has dropped by nearly 30 percent since 2000. Strong output growth combined with declining employment means labor productivity (output per worker) is growing quickly—much more quickly than in the economy as a whole.

Looking at these numbers, many conclude that the rapid productivity growth must reflect automation and that automation, in turn, must be responsible for manufacturing’s job losses. On the surface, that story seems sensible. After all, everyone has heard about robots replacing workers in factories. But, if you take a deeper look at what is going on in the sector, the narrative doesn’t hold up.

It turns out that one relatively small sub-sector, the computer industry, drives the strong output and productivity growth in manufacturing. The computer industry, which includes semiconductors and related electronics, accounts for only about 13 percent of manufacturing output. Output has been weak or declining in the industries that make up the other 87 percent of manufacturing. If one excludes the computer industry from the numbers, manufacturing output is only about 8 percent higher now than in 1997. It is about 5 percent lower than before the Great Recession. And, without the computer industry, productivity growth is no higher in manufacturing than in the economy overall.

JB: OK, so one sub-sector, computers, is the main driver of the sector’s output and productivity growth. But why does that undermine an automation story?

SH: Remember, the basis for the automation story is that output growth has been about as high in manufacturing as in the rest of the economy and productivity growth has been much higher. Neither is true in most — 87 percent — of manufacturing.

Many processes in manufacturing have been automated. But automation and other types of labor-saving technology have been introduced throughout the economy, not just in manufacturing. The critical difference is that, unlike in other sectors, output in most manufacturing industries has barely risen or declined since the late 1990s. It’s the very weak performance in U.S. manufacturing, when combined with automation, that has led to massive job losses since 2000.

JB: Well what about the computer industry? Couldn’t one tell a story about automation for that industry?

SH: No. The computer industry has been automated for years. Productivity growth in that industry — and by extension the above average productivity growth in the manufacturing sector — has little to do with automation.

Computers, semiconductors and other electronics are much more powerful today than in the past. The extraordinary productivity growth in the computer industry has to do with the way government statisticians account for the rapid technological advances in the products made in this industry. Consider this simple example. Say buyers are willing to pay 15 percent more for a new computer that boasts greater speed and more memory than last year’s model. Then, in a statistical sense, 100 of the new computers would be the equivalent of 115 of last year’s model.

As a result, the rapid output growth in this industry does not mean that American factories are producing many more computers, semiconductors, and related products — they may be producing fewer. Instead, it reflects the fact that the quality of the products produced is better than in the past. And because assembling a higher-powered computer or semiconductor doesn’t necessarily require more workers, the extraordinary output growth in the computer industry translates into extraordinary labor productivity growth.

Perhaps ironically, the locus of production of semiconductors and computers has been shifting to Asia. Offshoring, not automation, is responsible for recent job losses in the U.S. computer industry. The loss of production to Asia is likely already contributing to a slowdown in measured output and productivity growth in manufacturing.

JB: Outside of computers, you note that manufacturing output has been “anemic” and that globalization is a major factor accounting for this result. What do you mean by that?

SH: As I mentioned, besides computers, output in manufacturing is barely higher today than in the 1990s and is actually lower than in 2007, before the Great Recession. Since the U.S. population has grown about 18 percent since then does that mean that the average person is buying fewer things? Of course not.

The reason for manufacturing’s anemic performance is that U.S. consumers and businesses are buying more imported products, and American exports have not risen commensurately. Instead of manufacturing their products in the United States and exporting them to foreign markets, U.S. multinational companies now often locate production overseas to take advantage of lower labor costs and taxes, among other factors.

So, manufacturing’s anemic output growth is largely the result of globalization. That fact, coupled with automation, is responsible for the large reductions in manufacturing employment since 2000.

JB: Hasn’t manufacturing employment declined as a share of total employment in every advanced economy? Is it somehow worse here?

SH: That’s right, manufacturing employment has declined as a share of employment in other advanced countries, too.

In the United States, manufacturing’s employment share has been falling since the 1950s. But the number of manufacturing workers trended up until the 1980s, and then was fairly stable or declining very slowly. That situation abruptly changed in the United States after 2000. Between 2000 and 2007, which were business cycle peaks, manufacturing employment plummeted by 20 percent. Manufacturing employment has not recovered from the Great Recession, and now is 29 percent lower than in 2000. That decline is historically unprecedented. And those large-scale job losses are the reason for the focus on manufacturing in the presidential campaign.

But U.S. job losses are not unique. Other advanced countries have been exposed to the same forces of globalization. Many have experienced substantial job losses in their manufacturing sectors in recent years and in Britain, they have been on par with losses in the United States.

JB: When you hear the candidates talk/fight about this, is anyone saying anything that resonates with you?

SH: First, I want to say that the spotlight the presidential campaign has shined on problems in American manufacturing is a good thing. The weakness of the American manufacturing sector often is not recognized — in part, as I’ve explained, because the data can be confusing. And too often the consequences of manufacturing job losses for workers and communities are ignored, or minimized, or taken as inevitable.

Decades of research has shown that when factories close, many of the workers who are displaced are permanently harmed. Their future earnings on average are lower, and some, especially the older workers, never find a new job. Factory closures have large spillover effects, and it can take a community a generation or more to come back. In the 1940s and 1950s, the migration of textile mills to the South devastated the economies of many towns in the Northeast. In the 1980s, a global glut of steel led to the shuttering of many steel mills in this country — some former mill towns are still depressed. In the 2000s, a wave of imports, particularly from China, led to many factory closures around the country. Those closures have had serious consequences for the laid-off workers and their communities. That’s why Donald Trump’s angry rhetoric about trade has resonated with many people.

That said, Trump’s blunt policy proposals — like tearing up our past trade deals and slapping higher tariffs on imported goods — are bad ideas. They would likely invoke retaliatory actions by our trading partners. Moreover, production is more globally integrated than in the past. Factories and other businesses have come to rely on imported materials and parts, and raising tariffs would unintentionally harm them and their workers.

We can’t turn back the clock, and besides, trade broadly benefits many Americans. But when working out the specifics of trade deals, our negotiators need to better take into account workers’ interests and avoid terms that will lead to large-scale layoffs. That, essentially, reflects Hillary Clinton’s position on trade deals.

JB: What do you think we should do, policy-wise, to revitalize our factory sector?

SH: Revitalizing American manufacturing will necessarily involve a number of different policies. For example, the international competitiveness of domestic manufacturing depends to a large degree on exchange rates. When the dollar strengthens against foreign currencies, Americans benefit from lower import prices, but domestically-produced goods become less competitive at home and abroad. We need to make sure that our trading partners do not keep their currencies artificially low against the dollar in order to “export unemployment” to the United States.

In order to take advantage of tax policies that favor multinationals, some American companies have relocated overseas or expanded their foreign operations at the expense of their domestic ones. The Obama administration has taken steps to address this problem — specifically steps that discourage so-called inversions — but more comprehensive tax reform is needed. Government subsidies for research and development, technical assistance for small manufacturers, and subsidies for worker training at businesses and at community colleges will also improve the competitiveness of domestic manufacturers and help revitalize the sector.

At the same time, we need to be realistic. With globalization and technological change, there will be on-going restructuring in the American economy. Factories will close. So, income and retraining assistance for dislocated workers and economic development assistance for their communities should be an integral part of the policy mix.

BrandorKP posted:

You are an idiot who lacks comprehension. I used the word garbage to describe what Rowe had to say. I was criticizing the criticizing of others going too far. It's good to give a poo poo about the work we do in the world.

Crowsbeak posted:

It might be that they are worse than conservatives at least conservatives admit they want people to suffer.

Dr. Fishopolis posted:

You see, people who live in shanties could simply move if only they had the will. Perhaps the poor are lazy and simply prefer not to work?

BrandorKP posted:

Whatever system we end up with in the future, it must provide those things : adequate food, shelter, education, and healthcare, to the populations that participate in it. The wages of the failure to provide those things will be death, in a literal sense, from instability and the growth of reactionary right.

caps on caps on caps posted:

So why not a social market democracy?

Identify failures of markets by applying the existing theory to the more and more advanced empirical modeling we have available today, think seriously about uncertainty and limited rationality, regulate and redistribute the poo poo out of everything with some machine learning mechanism design magic.
The tools will be here sooner or later.

The issue is that people/corporations either want free markets or full communism, both of which are ideologies without any economic theory support behind them.[

AstheWorldWorlds posted:

Not if it pays nothing and is immersed in an environment of subjugation. While you call it garbage you were indeed defending the central thesis of the argument, as you remained adamant that one must still somehow remain invested along the lines discussed by Rowe. That you trot out a line about human freedom not being so in such an environment consequently strikes me as deeply loving ironic.

Helsing posted:

BrandorKP posted:

I'm not being paid to suffer a fool right now. Doesn't mean I shouldn't take pride in it. Anything we do we should do well and this doesn't have anything to do with how we are compensated.

Helsing posted:

readingatwork posted:

This is a great interview. My only real gripe is with the attitude that we can't actually change policy now because of retaliation. gently caress that pussy bullshit. America is an economic behemoth and most countries would get crushed if they tried to play that game.

Squalid posted:

The global economy is not a football game and you don't win by beating everyone else. We all win when we work together to make ourselves and the world a more prosperous place.

You are identical to the German who says Greeks need to be disciplined for their profligacy: even if it destroys their economy. You're the same as the racist who says welfare queens are exploiting hard working (white) folk. You're indistinguishable from the anti-immigrant hardliners who want our fieldworkers deported to boost wages for Americans- even if it's guaranteed those jobs we just go to different foreign workers on seasonal work visas, or be automated.

You just want America to start winning again so bad- you don't care if winning over everybody else is certain to make us all worse off.

readingatwork posted:

But hey some poor bastard in Bangladesh has it worse so those problems don't count I guess.

Paradoxish posted:

I'm not sure the data really backs up her conclusion entirely. This is manufacturing output vs. employment in the US, both indexed against 1997 since it's the cutoff that Houseman uses in this interview:



Growth in manufacturing had clearly been rising dramatically for some time (1987 is as far back as the output series goes) despite no meaningful change in employment.

quote:

Moreover, the employment metric here is thousands of persons, so that straight line is actually a gradual decline once population growth is taken into account.

quote:

Without doing more research I'm willing to take the computer industry growth aspect of what she's saying at face value for 2000 and beyond, but it's pretty clear there's more going on here in general.

Edit- And it's also worth pointing out that that massive drop from 2000 until now represents only about 3% of the total labor force over the course of 16 years.

Helsing posted:

This was addressed in the interview. The increase in output is attributable to the rapid development of the electronics industry, especially computers, and the fact their processing speed keeps increasing every year. The rest of the manufacturing sector has performed quite poorly and at best is keeping pace with the rest of the economy, or at worst lagging behind it in productivity growth.

Susan Houseman posted:

If one excludes the computer industry from the numbers, manufacturing output is only about 8 percent higher now than in 1997. It is about 5 percent lower than before the Great Recession. And, without the computer industry, productivity growth is no higher in manufacturing than in the economy overall.

Helsing posted:

No it isn't. Manufacturing employment was relatively stable for decades and then suddenly makes a dramatic plummet around the year 2000.

Helsing posted:

Obviously there are other factors at play here and this is only one part of a larger story but the idea that there wasn't a huge disruption in the manufacturing industry, which was directly tied in to the opening up of new labour markets in places like China, is ridiculous.

AstheWorldWorlds posted:

Yeah, once again, I have no idea what you are talking about regarding pride in ones work as it pertains to Mike Rowe's right wing screed, as that is not his central argument. That you are persistent in this point really does leave an impression you are obliquely defending him wrt Protestant work ethic.

call to action posted:

gently caress the rest of the world rich, America The working people of the world should focus on making Americans everyone better off. That includes everyone already here alive, so throw full amnesty into that.

BrandorKP posted:

I know you don't, and I'd imagine you don't don't get the story about Jesus and the fig tree either.

AstheWorldWorlds posted:

I know you think this kind of rhetorical move is clever, but it's just Christian sophistry and a transparent dodge.

BrandorKP posted:

These are question of class. You understand neither the dignity of work or the immediacy of the need for justice. Not understanding those things is deadly to possible ways forward right now.

AstheWorldWorlds posted:

Mike Rowe's terrible SWEAT pledge:

BrandorKP posted:

Again that I described as garbage. I have a toddler, he would have comprehended that by this point, hell he'd have gotten it the second time I made it. But enough arguing with an idiot.

The shipping line ZIM is pulling off the west coast. Just heard from a Chief officer that the next voyage will be the last calling of west coast ports for vessel on the service. They canned office staff over a month ago in my area. Several months back they sold thier ships to a bank and chartered them. I've seen it explicitly stated the intention is for them to shrink down to a regional Mediterranean carrier. This is a slow motion controlled failure. It won't likely make the news (because it's happening slowly) but it's another container line failing. Expect more if there is a border adjustment.

BrandorKP posted:

Again that I described as garbage. I have a toddler, he would have comprehended that by this point, hell he'd have gotten it the second time I made it. But enough arguing with an idiot.

Goa Tse-tung posted:

where? I just hit https://forums.somethingawful.com/showthread.php?threadid=3761067&userid=9123 and you never said it directly?

Goa Tse-tung posted:

where? I just hit https://forums.somethingawful.com/showthread.php?threadid=3761067&userid=9123 and you never said it directly?

BrandorKP posted:

Rowe's list is about giving a poo poo about what you do, whatever it is. The structure of the list is garbage. His worldview also denies all the things outside ourselves that limit and determine our actions. That is also garbage. But there is one piece of substance in it. We can and should choose to give a gently caress about what we do in the world. Ignoring that, failing to understand that, means they win everytime. Because they'll give a gently caress and we won't.

Paradoxish posted:

What? I specifically responded to this in my post. Here:


I chose those graphs to show that the massive increase in output coupled with flat employment began long before the time period she's talking about here. In fact, it goes all the way back to the beginning of the series tracking that data. So that massive jump in growth from 2000 is thanks to the computer industry - so what? She's still saying that the rest of the manufacturing sector has increased its output by 8% over the last two decades despite cutting a third of its workforce.

quote:

Yes, I also acknowledged this in my post. My point is that the civilian labor force literally doubled between the early 60s and 2000, yet manufacturing employment was flat in absolute terms over that same period.

quote:

I never said any of this, so I don't know why you're responding to my post as if I did. Manufacturing was a rapidly diminishing part of the employment picture in the US long before 2000, and that apparently precipitous drop over the last 16 years actually doesn't represent a huge number of jobs compared to the wider labor market.

Industry Week, Why the Trade Deficit in Manufactured Goods Matters posted:

While the United States has been running a trade deficit in manufacturing for more than three decades, it grew considerably worse after 2000.

During the ensuing decade, the United States accumulated an aggregate negative trade balance of $5.5 trillion, and in five of those years, the deficit topped $600 billion.

To put this in perspective, during each of those five years, on average, each American household imported $5,450 in goods and services that was not matched by equivalent exports. In other words, over five years every American household got the equivalent of a new BMW essentially on credit, since we were not exporting an equivalent amount.

Many Americans comfort themselves by thinking that the vast majority of the U.S. trade deficit in goods is comprised of oil, cheap low-value items, or the mass-market consumer electronics. Surely, the United States must run a trade surplus in advanced technology products from industries such as life sciences, medical devices, optoelectronics, IT, aerospace, and nuclear power.

But in the ten-year period from the beginning of 20002 to the end of 2011, United States ran a trade deficit in advanced technology products of $526 billion deficit.

AstheWorldWorlds posted:

Also I don't believe I have ever commented on Putin or Russia, so weird of you to bring it up. Actually if you look at my post history I have backed you up on more than one occasion regarding this stuff.

Helsing posted:

Output is only about 8% higher than it was in 1997 and in fact about 5% lower than before the Great Recession. That's not a "massive increase".

quote:

Yeah and then it made an unprecedented and dramatic drop since 2000 after remaining stable for decades. Between 1997 and 2008 manufacturing employment declined by 22%.

quote:

quote:

Do you really think the US could produce hundreds of billions of additional dollars worth of manufactured goods without a substantial increase in employment?

BrandorKP posted:

It was someone else. I piss enough people off I can't keep track anymore.

Lets cut this poo poo to the core. I'm saying it's good to give a gently caress about what we do in the world, our work regardless of what it is. Do you think that's worth doing or not?

Paradoxish posted:

I'm not trying to be a dick, but it seriously feels like you're not reading my posts. The "massive increase" in my post is referring to before 1997, which I brought up specifically to show that this isn't some new phenomenon. And there's still the issue that we're talking about an 8% increase in output alongside a large drop in employment.

quote:

Your argument that manufacturing employment was stable makes no sense when combined with your argument that an 8% increase in output represents a decline. You seem to be saying that it's a decline in real terms since consumption increased over that period, but if that's the case then manufacturing employment has actually been declining steadily since the 70s (at least). A roughly equal number of people being employed in manufacturing over a period where the labor force literally doubled represents a massive decline in the relative importance of manufacturing to the labor market as a whole.

quote:

FRED is really a lot better for this kind of data, since you can overlay series against each other:


Is there a correlation there? Yeah, kind of, but the declines in manufacturing employment correlate much more strongly with recessions. There's no evidence that the trade deficit for goods was increasing alongside declining employment during recovery periods. I'd argue that what you're seeing here is two separate data points that are both being affected by similar structural issues rather than some kind of direct cause and effect relationship.

quote:

No, but I never made this claim either. The problem is that this isn't a simple case of suggesting that we can open US factories and use them to start meeting demand for goods. That demand is largely for cheap goods, and manufacturing (even at its peak in the 90s) represents a small part of the labor force as a whole. We aren't going to suddenly start employing so many people in factories that aggregate wages will shoot through the roof because we simply do not need that many high paid factory workers.

AstheWorldWorlds posted:

What you are saying is true only if the labor is not coerced and is given willingly and not under duress, any conditions but these subject the broad mandate to do good work up to the context this is being applied to.

BrandorKP posted:

Have you ever watched Bridge Over the River Kwai? Even in that situation there is something deeply human in finding meaning in work even if it is forced and detrimental to our own ends, and even if one ends up pushing the plunger blowing it all up. This something that strongly motivates a good percentage of people, to the point of it being a fundamental part of thier identity. It's dangerous to just toss it out as protestant work ethic.

BrandorKP posted:

Have you ever watched Bridge Over the River Kwai? Even in that situation there is something deeply human in finding meaning in work even if it is forced and detrimental to our own ends, and even if one ends up pushing the plunger blowing it all up. This something that strongly motivates a good percentage of people, to the point of it being a fundamental part of thier identity. It's dangerous to just toss it out as protestant work ethic.

Ardennes posted:

(Granted, I don't think work itself is a bad thing and if anything can be extremely unifying but that doesn't actually fix the issue of starvation pay and terrible working conditions.)

AstheWorldWorlds posted:

FWIW, I do agree that one should do good work but that this is heavily contingent on the degree of coercion involved. Rowe is ideologically committed to never seeing any coercion in capitalism, and so the entirety of his manifesto is garbage.

Like to expect the same enthusiasm and passion out of wage slaves working at wal-mart as well compensated members of a WSDE seems perverse if not outright sadistic to me.

Ardennes posted:

I do think work does have a socially unifying effect, the question is what it can be used for especially in a society that deeply values wealth. In the Soviet Union, the country was a worker state in a literal sense since there was practically full employment and everyone was classified as some type of worker (including intellectual workers). You can make a point this was still exploitative and in the end failed in it's goals but at the same time it did give society a unified sense of purpose and even at times comradery.

In comparison, in the US where is this actually leading? You can tear down the ideology of the Soviets, but there doesn't actually seem to be any foundation to the same type of "worker pride." At least the Soviets thought there were struggling towards something even if the cause collapsed on itself, what is the point of pretending we are "all in it together" when it is very very clear we aren't?

Cerebral Bore posted:

I know I'm pointing out the obvious, but it's much easier to exploit someone if they think you are in it together.

AstheWorldWorlds posted:

FWIW, I do agree that one should do good work but that this is heavily contingent on the degree of coercion involved. Rowe is ideologically committed to never seeing any coercion in capitalism, and so the entirety of his manifesto is garbage.

Like to expect the same enthusiasm and passion out of wage slaves working at wal-mart as well compensated members of a WSDE seems perverse if not outright sadistic to me.