[RFEngineer]

"I'm not sure what you mean by this."

What I mean is that productivity gains in the economy, defined as unit output per labor unit input, would act to cause manufacturing as a % of GDP decline if demand did increase in concert with productivity gains.

This would not be an indication of something bad. Further if productivity of an item increased, but demand did not increase, then price for the given item would tend to decrease, further decreasing it's impact on the GDP on a percentage basis.

As a result some might say we have a manufacturing "crisis" by analyzing the GDP graph, when in actuality, demand for a certain item is being met and met more efficiently over time. I would say the net effect of this would be positive, not negative.

Does that make any more sense?

[RFEngineer]

" if demand did increase in concert with productivity gains. "

er...what I meant was:

" if demand did NOT increase in concert with productivity gains. "

[Principled]

Well, I agree with what you've said. However, my problem is that all segments of our economy are more efficient now than 50 years ago. Either manufacturing has been outpacing other segments consistently by a margin of 100% over the last 50 years OR manufacturing is shrinking OR a combination of both.

Can we look at the real dollar value of US exports? Perhaps that and a comparison to real dollar value of imports would provide some indication to the possibilities?