MADE IN THE USA?
It Won't Be Easy
Is Made in the USA a lost dream, never to be restored as a symbol of American pride and prestige? What is the current condition of manufacturing in the United States? Today more material goods are being manufactured in the world than ever before. But these goods are not being manufactured in the U. S.
At home, the manufacturing job market has been on a steep decline since the early 2000s. There has been more and more automation in world industry every year. The exponential growth in automation has been driven, nearly entirely, by one advanced technology—the microprocessor and its software. That single advance in technology has helped manufacturers become much more efficient in producing useful goods and services. In turn, that improved efficiency has reduced the need for human labor or “blue collar” workers. Now there are fewer jobs requiring human manual input. With the help of automation, one person can do a job that required multiple workers in the past. Many of those workers were union members. Automation has saved companies large sums of money and increased productivity. After all, a computer-controlled machine does not need breaks, it can run 24/7 after it has been programmed. And there is no collective bargaining agreement.
One reason manufacturing jobs are being replaced by automation is the decreasing costs of integrating automation into manufacturing facilities. The costs of robots and automation is expected to drop by 65 percent by 2025. Because automation is far less expensive than employees, we will continue to see manufacturing jobs decrease. A recent study by MIT suggests that 57 percent of all manufacturing could be fully automated in the next 20 to 25 years. It could be a higher percentage than that and much sooner.
U.S. manufacturing peaked in the late 1970s, with nearly 20 million people in manufacturing jobs. However, between 1980 and 2017, the U.S. lost roughly 7.5 million manufacturing jobs. Starting in the late 70s and 80s, more and more people began to pursue higher education, leading them to seek what they considered to be more desirable jobs that were less labor intensive but paid much more. The combination of people pursuing higher education and increasing automation caused the manufacturing job market to decline steadily from its peak in 1979. But those weren’t the only reasons for America’s decline in manufacturing jobs. The jobs went overseas. And the higher education results? Wrong disciplines. It takes STEM to manufacture, not liberal arts.
Many U.S. companies have outsourced their manufacturing to other countries. Thanks to the efforts of the Clinton Administration, China began participating in the World Trade Organization in 2001. Chinese imports to the U.S. quadrupled between 2001 and 2004. The main reason companies have done so much outsourcing has been cost savings. China has very few labor laws and a low minimum hourly wage, which means companies can pay employees a lot less for more hours of work. In addition, manufacturing requires reasonably priced, available and reliable energy. China has no regulatory constraints on its energy producers. It is building coal-fired, natural gas, hydroelectric and nuclear power plants. In the U. S., the energy industry has been demonized and is being regulated out of business by the Biden Administration. The Administration kills pipelines, drilling, fracking, and refining, then blames higher prices on the industry for not producing more oil and gas. The Administration is either insane or incompetent, perhaps both. The energy producers, in particular the refineries, are a part of manufacturing, a very vital part.
Manufacturing, was once an integral part of the U.S. economy. In fact, manufacturing provided the highest number of jobs for workers without college degrees. It can again, but we have to decide that we want to be manufacturers once again and buy our own manufactured goods. Today, China is the largest exporter of manufactured goods in the world and we are a major importer of those goods. Many of these goods have a strategic application so we are counting on our main competitor—China, to be generous. We need to reduce our dependence on Chinese goods. So part of the solution is going to involve revising trade agreements and that may be painful. And we must also increase the focus of educators and academics on occupational skills, trades and high tech careers. These highly trained individuals will advance into the management ranks of our domestic manufacturing plants which will then result in more productivity and innovation.
American productivity is the key to reducing inflation. And so far since January 20, 2021 when the Biden Administration took over, we have been doing the opposite of what is necessary. VOTEdemsout2022