The State of Manufacturing in Our Union: A Lesson in the Power of Data

The State of Manufacturing in Our Union: A Lesson in the Power of Data

I anticipated that this blog would be about President Trump’s first State of the Union address. I imagined some words spoken or themes struck, in the actual speech or in the responses and reactions to it, that would provide the grist for my blogger’s mill. But that’s not what happened.

I was on the road Tuesday, so I planned for an early dinner that would allow me to get to my room to watch the speech. This meant a quiet table in a noisy bar, rather than the noisy (and delightful) dinner table of my home.

I was casually flipping through various news stories at dinner. Then . . . I saw this graph:

 

The graph was part of a FiveThirtyEight.com story on Donald Trump’s first year in office.

Though I would watch the State of the Union address that night, my thoughts kept returning to this graph, both for the information it conveyed and for the power with which that information was conveyed.

First, the information:

Looking at the data for the purpose of assessing President Trump’s first year, one naturally focuses on the uptick in growth in manufacturing jobs in 2017. Against the trend since we stopped the net shedding of manufacturing jobs in 2010, the growth rate in the number of manufacturing jobs in this country in 2017 was an improvement, if only a modest one. Good news for job-seekers and for the president.

But step out of that context for moment. Look at the graph, not to assess blame or justify praise, but as a window into one powerful dynamic in our economy over the last several decades. Through that window, it’s the precipitous decline in manufacturing jobs throughout the first decade of this century that grabs our attention. At no other time in our recent history has the United States suffered such a dramatic loss in manufacturing jobs over such a sustained period. The nation lost roughly a third of all its manufacturing jobs over the course of those 10 years, most of them before the Great Recession.

The number of manufacturing jobs in the United States in 2010 was the lowest since the Second World War began. And that’s the number. As a percentage of all jobs in the U.S., the transformation of our economy (and the decline of manufacturing) is even more dramatic, as the next chart illustrates:

Manufacturing has gone from 32.9% of all jobs in the U.S. in 1910 to 8.7% in 2015. What has picked up the lion’s share of the slack? Service jobs. What were called “other professional services” in 1910 has grown from 3.0% to 28.9% of all jobs in the United States.

Service jobs generally pay less than the manufacturing jobs they replaced and are less likely to be unionized than manufacturing jobs were in the 20th century. Love ‘em or hate ‘em, unions generally have meant better wages, better benefits and greater job security . . . all boons to working families.

That’s an important lesson in contemporary labor economics as relevant to a city’s efforts to attract more jobs for its residents as for the president’s continuing push to regrow the manufacturing sector.

And it also makes another critically important point: the value of good data, presented clearly and without distortion, to effective policymaking.

 

 

Interested in hearing me speak live? I’ll be at the National League of Cities Congressional Conference with two opportunities to learn: Leadership 101- Rules and Tools and Leadership 201- Fostering a Culture of Ethics. Join me on Sunday, March 11. 

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