Oddly, Manufacturing is Up...

Discussion in 'Economy' started by IndependntLogic, Oct 5, 2011.

  1. IndependntLogic
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    IndependntLogic Senior Member

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    What do we make of this?

    Reuters:

    The Institute for Supply Management said on Monday its index of
    national factory activity rose to 51.6 last month from 50.6 in August.
    September marked the 26th straight month of expansion in a sector that
    has shouldered the broader economic recovery.
    Economists polled by Reuters had expected the index to edge down to
    50.5. A reading above 50 indicates expansion manufacturing.
    A measure of factory employment rose to 53.8 last month from 51.8 in
    August, while production climbed to 51.2 from 48.6.
    Part of the long term rise in factory activity is a result of a weaker
    dollar, which makes American exports more attractive overseas. And
    there is no guarantee that what the factories are making will not
    simply end up as unsold inventory.
    But for the moment, the industrial sector appears to be one of the
    only bright spots in a gloomy economy.


    I mean obviously, with so many jobs shipped overseas or replaced by robotics, we'll never have the same percentage as we did in the 70's but this caught me by surprise.
     
  2. expat_panama
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    expat_panama Silver Member

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    Please share with us what was it in the 70's, or if you're making it up let's look together at the actual numbers.

    There's a lot of evidence that over the decades American factories have produced more with less, resulting in greater well being for all. A job is not something that can be packed in a crate and 'shipped overseas'. That's crazy. Productivity is a good thing. In real life a factory that's more efficient and can make more goods and better goods with fewer man-hours ends up hiring more people than the factory that produces fewer goods of lesser quality.
     
  3. Dragon
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    Dragon Senior Member

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    That the U.S. has lost manufacturing capacity or "no longer makes things" is a myth. We have lost a lot of manufacturing JOBS, but we still make as much as ever measured by value-added. The jobs have been lost to a combination of outsourcing and automation.

    It wouldn't be a problem except that the government adopted a labor-unfriendly attitude at the same time, making it prohibitively difficult to unionize the service jobs that have taken the place of the lost manufacturing jobs. The solution isn't to bring the manufacturing jobs back; for the most part we can't do that, any more than we can bring back the agricultural jobs that most people worked at before agriculture was automated. The solution is to empower service workers, because that is what most of us are going to be for the foreseeable future -- or at least until service jobs are automated out of existence, too.
     
  4. Wiseacre
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    Wiseacre Retired USAF Chief Supporting Member

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    Whoop-de-do. Good that it's not going down, but since the 51.6 index is not all that much higher than 50, which is the cutoff for determining manufacturing expansion, I'm not overly impressed. Doesn't sound like a double dip is coming, based on this number, but we aren't that far removed from it either.
     
  5. expat_panama
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    expat_panama Silver Member

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    No they haven't. Over the decades factory output has soared and so has employment. The trend is over time Americans work smarter with fewer grease monkeys and more engineer/programmers.
     
  6. Dragon
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    Dragon Senior Member

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    The number of engineers and programmers required is far less than the number of grease monkeys that used to be. Manufacturing employment has NOT soared. It has sharply declined (as a percentage of the total work force), even as factory output has indeed increased.

    Here: Midwest Economy: Is U.S. Manufacturing Disappearing?

    So it's just as I said, factory output is higher than ever, and America is not, as myth would have it, a country that no longer makes things. We're just a country that makes things very efficiently, employing far fewer people per unit of output than we used to.

    Outsourcing is only partially the cause. At least as much is due to improved equipment and methods -- automation, in other words. Jobs lost to outsourcing could conceivably be brought home, but that would be a temporary gain; cheap foreign labor is cheaper than the automation that would replace it, but expensive American labor is not.

    We are never going to see most of those manufacturing jobs again. They've been replaced by service jobs, and so what we need to do if we want to see wages like in the past is to empower service workers, not mourn the loss of grease-monkey jobs.

    But the real crunch will come as service jobs are automated, too, as is already happening. When agriculture, manufacturing, and services are all automated, we will have a permanent dearth of jobs, an ability to produce goods and offer services with only a bare skeleton crew of people.

    It's an interesting political and economic question what will happen when jobs become permanently and irreversibly scarce.
     
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  7. Katzndogz
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    Katzndogz Diamond Member

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    I'll buy something made in another country before I buy something union made here.

    I despise unions.
     
  8. expat_panama
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    expat_panama Silver Member

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  9. Trajan
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    Trajan conscientia mille testes

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    It wouldn't be a problem except that the government adopted a labor-unfriendly attitude at the same time, making it prohibitively difficult to unionize the service jobs

    how so?
     
  10. waltky
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    waltky Wise ol' monkey Supporting Member

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    Obama gonna run `em outta town if dey don't get with the program...
    :clap2:
    Obama to GOP: Act on jobs or get run out of town
    Thu Oct 6,`11 : WASHINGTON – A combative President Barack Obama challenged a divided Congress on Thursday to unite behind his jobs bill or get ready to be run "out of town" by angry voters. Hoping to use public frustration and economic worry as leverage, he called his proposal an insurance plan against a painful return to recession.
    See also:

    Obama Says Jobs Plan Can Grow GDP as 'Much as 2%'--But WH Estimates It Will Cost 3%
    October 6, 2011 – At a White House press conference on Thursday, President Barack Obama said the legislation he has proposed to create jobs could "grow the economy as much as 2 percent." However, the White House estimates that the plan itself will cost $447 billion -- or 2.97 percent of the 2011 GDP of $15.012 trillion that is currently projected by the federal Bureau of Economic Analysis.
     
    Last edited: Oct 6, 2011

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