The employment graphic that that may give President Trump headaches
Posted February 23
If Donald Trump won the election by promising to "bring back" jobs to America's manufacturing sector lost to overseas competition, the Trump administration may be in for a surprise when it learns how many of those jobs never "left" the country at all. They just disappeared.
Variations on this surprising data have been graphed by experts on both sides of the aisle: economist Mark J. Perry at the right-leaning American Enterprise Institute and policy analyst Mark Muro at the left-leaning Brookings Institution.
Both demonstrate that U.S. real manufacturing output, adjusted for inflation, has been soaring since 2000, even as manufacturing jobs have plummeted.
"These diverging lines — which reflect the sector’s improved productivity — highlight a huge problem with Trump’s promises to help workers by reshoring millions of manufacturing jobs," wrote Mark Muro at Brookings, after the election. "America is already producing a lot. And in any event, the return of more manufacturing won’t bring back many jobs because the labor is increasingly being done by robots."
Even accounting for a dip during the recent recession, U.S. inflation-adjusted manufacturing output is at all-time highs, with jobs in sharp decline, due in large part to increasing efficiency, including automation and other technology.
Some evidence that jobs are disappearing, not leaving town, is found in a second graph put together by Perry. It shows an extremely steep climb in per worker productivity in the U.S. from 2000 to 2010.
In short, U.S. manufacturers are producing more goods with fewer workers.
All of this presents campaign promise fulfillment difficulties for Trump, who has blamed job losses on a decline of U.S. manufacturing, driven by companies fleeing the country to find cheaper labor elsewhere.
"Trump promises to 'bring back' millions of manufacturing jobs for dispossessed workers by modifying the terms of trade: by renegotiating NAFTA, rejecting the Trans-Pacific Partnership, and slapping China with tariffs," according to Brookings' Muro. "But the fact that the U.S. manufacturing sector has been succeeding by many measures in recent years makes President-elect Trump’s promises seem like false dreams."
Trump's economic appeal was squarely centered on the notion that U.S. manufacturing is in decline, largely due to companies moving plants overseas.
If U.S. manufacturing output is, in fact, at all time highs — and if the real problem is that automation has made per worker output skyrocket — then there may be nothing Trump can do to bring these jobs back.
“What I fear is that the underlying economy is changing, these communities are losing population and jobs, and I don’t think Trump or any policy is going to reverse that,” Jeffrey Stonecash, an emeritus professor of political science at Syracuse University, said after the election.
Stonecash likened the situation to the end of the 19th century, when technological change undercut American farmers and skilled craftspeople, driving workers to the big cities and large factories.
“It was a nasty, brutal transition,” Stonecash said.