If you listen to the wrong people, the North American manufacturing industry is doomed.
There is no denying that the U.S. and Canada have been losing jobs to offshore competition for almost half a century. From 2000 to 2010 alone, 5.6 million jobs disappeared.
Interestingly, though, only 13 percent of those jobs were lost due to international trade. The vast remainder, 85 percent of job losses, stemmed from “productivity growth” — another way of saying machines replacing human workers.
For many, this scenario is even worse. China and Mexico may be “taking our jobs,” but at least they’re going to other humans. Robots, on the other hand, allegedly threaten to wipe entire sectors, like manufacturing, right off the map. The level of fear-mongering here is high: “How to Keep Your Job When Robots Take Over.” “Is a robot about to take your job?” “What Governments Can Do When Robots Take Our Jobs.” It’s enough to make anyone a little nervous.
The facts, however, tell a different story. Over the last 20 years, inflation-adjusted U.S. manufacturing output has increased by almost 40 percent, and annual value added by U.S. factories has reached a record $2.4 trillion. While there are fewer jobs, more is getting done. Manufacturing employees are better educated, better paid and producing more valuable products — including the technology that enables them to be so much more productive.
In fact, there are currently two million jobs going unfulfilled in the manufacturing sector, largely due to an aging workforce — the average age of a manufacturing worker is almost 45, two and a half years above the national non-farm median — and negligible interest in those jobs from younger generations.
