Loss of factory jobs may have a long fall to bottom

Boston Globe ^ | 8/10/2003 | Charles Stein

[Willie Green]

In August 2000 the American economy lost manufacturing jobs. It lost more in September and October. For the next 33 months, right up until today, the same thing happened. Raise your hand if you detect a pattern here.

If you want to know why the job market is so weak, manufacturing is a good place to start looking. While service employment has roughly held its own over the past 18 months, manufacturing jobs have disappeared at a rate of about 75,000 per month. And then there is the bad news. Some forecasters think the decline will continue, even if the overall economy gets better. ''It is not clear to me why this should end right away,'' said Anirvan Banerji, director of research at Economic Cycle Research Institute in New York.

[Willie Green]

ping

[fight_truth_decay]

Note: The Boston Globe is owned by the NYTimes.

[fight_truth_decay]

Correction: "the same family as the NYTimes"

[sarcasm]

For the factory workers who lose their jobs, the decline of manufacturing is an unmitigated disaster. ''Manufacturing industries allowed America to have a middle-class life for the working class,'' said Barry Bluestone, an economist at Northeastern University. In most cases the displaced workers will be hard pressed to duplicate the wages and benefits they had before.

Can you say more transfer programs?

[RJCogburn]

Seems about right.

Good post.

[Who dat?]

''Manufacturing industries allowed America to have a middle-class life for the working class,'' said Barry Bluestone, an economist at Northeastern University. In most cases the displaced workers will be hard pressed to duplicate the wages and benefits they had before.

It’s funny; “middle-class.” Actually, in almost any other country in the world, someone that had air conditioning, running water, electricity, multiple TV sets, Nintendo, computer, refrigeration, several cars, indoor restroom, telephone, washer and dryer, pension plan, AND medical insurance, would be considered part of the elite.

We have people that were born on welfare that have most of those things and they’re considered disadvantaged.

Maybe “middle-class” refers to low-class people that are used to getting high-class compensation and are entirely ungrateful for it.

[knowtherules]

Bingo

[Willie Green]

Note: The Boston Globe is owned by the NYTimes.

Whooooptie-do.

[Willie Green]

Maybe “middle-class” refers to low-class people that are used to getting high-class compensation and are entirely ungrateful for it.

Can't have "low-class people" aspiring for upward mobility, can we?
That'd be entirely un-American.
Gotta knock 'em all back down into poverty where they belong.
Screw 'em all! Let's bring hunger and starvation back to America!
Yep, that'll teach those ingrates!
</sarcasm>

[syriacus]

I think it might be a good idea to encourage our children to go into careers that are harder to move overseas.

Maybe they should think about becoming doctors, teachers, nurses, receptionists, dentists, therapists, auto mechanics, plumbers, housebuilders, etc.

I don't know that there is a demand for workers in each of these jobs, but factoring in "non-overseas-transportability", while considering careers, might be helpful.

[PokeyJoe]

You forgot lawyers.

[Willie Green]

Maybe they should think about becoming doctors, teachers, nurses, receptionists, dentists, therapists,
I don't know that there is a demand for workers in each of these jobs, but factoring in "non-overseas-transportability", while considering careers, might be helpful.

Oh there's always a demand for these services...
It's just that without jobs, people can't afford these benefits.
A healthy manufacturing sector is the foundation that provides support for such services.

[marsh2]

I live in a county that is remarkable for its forests - mile after mile of marketable timber as far as the eye can see.

Our last sawmill is closing. (We had 50 at one time.) Many of the loggers and mill workers have moved. We have lost our infrastructure for harvesting timber. Because of US Forest Service policies and lawsuits, coupled with competition with Canada, (which is not burdened with same,) we can no longer attract a mill or biomass plant to locate here. It is no longer profitable. They need a guarantee of at least 5 years of supply to cover their investment.

Now the Forest Service comes out with its fuel reduction policies to keep our forests from burning like the Biscuit fire north of us. The forests are severely overstocked, dead and dying, and primed for catastrophic fire. No one is bidding on the "sales." There simply is no profit in them and the local environmentalists appeal or sue every time one is released.

So, we sit in our dying mill town, watching Canadian lumber pass through on railroad cars while wildfire smoke fills the air.

[RaceBannon]

Banerji thinks that could happen again. ''It would be a mistake to underestimate the ability of the US economy to innovate,'' he said. He pointed out that in the early 1990s the outlook for jobs and growth was gloomy, much as it is today

Can you say ENRON? Global Crossing?

[harpseal]

Ping

On or off let me know.

[harpseal]

Your advice might make sense if we did not have H1B workers coming in to take those jobs.

[waterstraat]

This stuff isnt even news anymore, it is what we should be expecting for the next 10 years until all manufacturing is gone.

[Matchett-PI]

Why U.S. Manufacturing Won't Die
WSJ ^ | July 3, 2003 | CLARE ANSBERRY
Staff Reporter of THE WALL STREET JOURNAL
Posted on 07/04/2003 12:25 AM EDT by edsheppa
http://www.freerepublic.com/focus/f-news/940250/posts

What role will U.S. manufacturing play in the national and global economies in the coming years? What jobs will be left for American workers?

It's more than an academic question for many company owners. Stan Donnelly, who owns Donnelly Custom Manufacturing Co. in Minnesota, is studying Mandarin in case he has to move his machines to China. Already, he buys molds from China to make his custom-designed plastic parts. To date, Mr. Donnelly has been able to keep production of those parts in the U.S. But as his customers increasingly demand lower prices, he wonders if he will one day need to move production to Asia as well.

Many experts believe that the pattern of past years will continue -- that low-skilled jobs making lower-value, mass-produced items will keep migrating to countries where labor is plentiful and cheap, while manufacturing in industrial nations, such as the U.S., Japan and Western Europe, will center on complex, value-added products and systems. Demand for more sophisticated luxury cars and ever-more elaborate communication systems will keep fueling highly automated machinery and processes. Many of those higher-margin, technology-intensive production will remain in the U.S., and should help keep jobs here becoming steadily better, safer and higher paid than in earlier generations.

Other jobs serving certain protected markets, like medical instruments that are carefully monitored and require collaboration between doctors, hospitals and producers, should also remain, as will those involved with making something big and bulky, like kitchen cabinets that are costly to ship, or perishable items like frozen food and bread.

"There's not enough boats in the world to bring all that Americans want into the U.S.," says W.R. Timken Jr., chairman of the century-old maker of bearings as small as marbles or big enough for a person to walk through. His company has operations all over the world, but still needs plants in the U.S. to make bearings for cars, trucks, helicopters and X-ray machines made here.

Demand will also escalate for basic goods like washing machines, cars and telephones in parts of the world where many people have never had them before. That will keep global assembly lines humming, as well as fueling demand for ever-more automated systems to operate them more efficiently.

In short, demand for manufacturing will remain robust for both the developed and developing world, concluded a two-year study by the Manufacturers Alliance, a public policy and business research group in Arlington, Va. "Every industry has certain pieces of manufacturing that will shift abroad, but also pieces that will remain in the U.S. because they embody high technology within that product," says Daniel Meckstroth, chief economist with the Manufacturers Alliance. "Over time it will evolve."

That isn't to say higher-skilled jobs won't also move overseas eventually. Already work forces in some developing nations are upgrading their skills and winning contracts to produce higher-end products. At the same time, the wage gap will continue to narrow as workers in developing nations grow more prosperous and develop a taste for a better standard of living.

So, what is likely to pull manufacturing overseas in coming decades? Cheap and available energy. Signs of such a trend are already here: Aluminum producer Alcoa Inc. is building a smelter in Iceland because of cheap hydroelectric power. The same plentiful power has attracted interest from Russian Aluminum and Alcan.

What will ensure U.S. manufacturing's future is innovation, just as it has in the past. A sheet of glass made by Pittsburgh-based PPG Industries Inc. is now self-cleaning, its coating breaks down and loosens organic dirt, which means less work for cleaning-averse consumers. The average car contains between 200 and 300 types of steel designed to be lighter for better fuel efficiency, yet strong enough to protect a passenger. In a decade, there will be yet more composite materials.

Beyond automobiles, even clothes and computers will be increasingly customized. It will require tremendous flexibility to innovate and get a product to the market quickly, as well as to integrate new technology and processes.

The U.S. will undoubtedly continue to lose jobs in areas like textiles, where both labor and materials are plentiful overseas. But positions in computer and mathematical occupations are expected to increase 29% in the coming decade.

Other hot jobs are expected to focus on industrial automation equipment, such as robotics. The U.S. Department of Labor projects that those jobs will grow faster than the economy as a whole and, in particular, even exceed growth in manufacturing. Toys and sporting goods, drugs, garden machinery, motor vehicles, metal coating and screw machine products, bolts and rivets industries are all in the top 25% manufacturing industries for both productivity growth and job growth, the Labor Department says.

In fact, U.S. manufacturers are increasingly worried about a serious projected shortage in skilled machinists and other factory workers.

That kind of demand will continue to make blue-collar life not only better, but also more critical to the health of the nation's economy. As Mr. Donnelly, the owner of the small Minnesota manufacturer, notes, a brilliant idea is worthless unless it can be made into something tangible and distributed. "That is what drives the economy and wealth of a society," he says.

Write to Clare Ansberry at clare.ansberry@wsj.com

[A. Pole]

It’s funny; “middle-class.” Actually, in almost any other country in the world, someone that had air conditioning, running water, electricity, multiple TV sets, Nintendo, computer, refrigeration, several cars, indoor restroom, telephone, washer and dryer, pension plan, AND medical insurance, would be considered part of the elite.

Poland (from where I came) is not very afluent and with the exception of air conditioning (you do not need it because of cooler climate) and multiple cars (one is enough as public transportation is everywhere and there is less space for parking) those things will not qualify you for the elite.

I guess you think that the right standard for America is India or Congo. How many countries did you visit?