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US manufacturing output has not actually declined though - it has never been higher and has increased over 40% in the last 2 decades[1]. The perception of US m

by derriz 4y ago

US manufacturing output has not actually declined though - it has never been higher and has increased over 40% in the last 2 decades[1]. The perception of US manufacturing decline is widespread. My guess is that this perception is due to a number of factors. Other sectors of the US economy have grown more, so manufacturing now represents a smaller share. And also as productivity increases, fewer people are required to produce the same amount of output - so manufacturing workers make up a smaller share of the workforce than they did in the past. Both of these facts mean that manufacturing has less visibility in the US than it had. Finally, as poorer parts of the rest of the world have grown - the US's share of global manufacturing is smaller. And by the way, there is absolutely no problem finding someone who will sell you a pair of US made shoes for $300 (or more) if that's what you want. There's a long list of US manufacturers who make high end boots and shoes. [1] https://data.worldbank.org/share/widget?end=2019&indicators=NV.IND.MANF.KD&locations=US&name_desc=true&start=1999&view=chart https://data.worldbank.org/share/widget?end=2019&indicators=...

ren_engineer 4y ago
relative output matters and the US has lost massively in terms of global manufacturing compared to what it used to be. saying US manufacturing hasn't declined is like saying IBM hasn't declined in stature compared to decades past. IBM technically has more revenue than they did in the past, but they aren't considered a technology leader anymore and very few are impressed by them, many see them as a dying company
- derriz 4y ago
  I don't think using IBM is an appropriate comparison. It is a company in actual decline - revenues peaked at about $110B just over ten years ago and were less than $60B last year. Like I said US manufacturing output is growing and has been growing. And I don't subscribe to a zero-sum view. Just because other historically poorer countries have grown economically doesn't hurt Americans (the opposite) or their way of life or standard of living. And just because other sectors of the US economy (like tourism for example) have grown more rapidly doesn't mean that US manufacturing is harmed - and certainly doesn't mean Americans are worse off in any absolute sense. Worrying about loss of stature is highly subjective and is more about feelings/pride/emotions/etc.
  - ren_engineer 4y ago
    the US objectively loses a massive amount of foreign policy leverage by not being the largest manufacturer anymore, this is undeniable and obvious when you see how many countries are openly not sticking with the US with regards to Ukraine because they can just side with China, Russia, and India. The US has gone from 40% of global GDP in the 60s to less than 20%, they've lost relative power when it comes to global issues as a result of that.
    - derriz 4y ago
      The US has also gained immense power through growth in other sectors like finance/banking/insurance - the biggest sector in terms of US GDP. The second biggest sector - professional/business services - also allows the US to project immense power - particularly when combined with the fact that the US dominates global banking and finance. Looking at a table of US GDP by sector, what rebalancing are you suggesting would increase the ability of US to project power globally? For more Americans and US capital to be involved in manufacturing, some other sector will have to shrink. And manufacturing is already the fourth biggest sector.
Nasrudith 4y ago
People don't see industies where they don't work. Rising specialization and automation means that fewer are involver in industry. People are myopic and judge facts by feelings instead of using them as a proper guide of priorities.
peteradio 4y ago
I'm skeptical of those numbers although they may be wholly true, they may only be technically true because final "huge value add" simple assembly is done onshore while all the base parts are produced offshore.
- taylodl 4y ago
  Ford "assembles" cars - that's why they're called "assembly lines." Yes, any manufactured good of sufficient complexity will have at least one part coming from somewhere else in the world that specializes in making that part. That's not a bad thing. Insisting we make everything in the U.S. to be counted as being built in the U.S. is a huge step backwards. It is simply unreasonable to expect the U.S. to be the most efficient at producing everything. And if we're forced to accept such inefficiencies then we're necessarily lowering our standard of living.
  - peteradio 4y ago
    I don't consider cars simple assembly, that has obvious value add when compared to a pile of parts. Fiber optic assemblies are expensive to buy but trivial to build from the inexpensive imported parts. Forcing purchasers of those assembled parts to buy onshore should count as an effective negative manufacturing GDP because it could have been purchased offshore fully assembled for cheaper. Perhaps there are good national security reasons for requiring onshore assembly of telecoms equipment but mixing it with economics statements is goosing.

by derriz 4y ago

ren_engineer 4y ago

relative output matters and the US has lost massively in terms of global manufacturing compared to what it used to be. saying US manufacturing hasn't declined is like saying IBM hasn't declined in stature compared to decades past. IBM technically has more revenue than they did in the past, but they aren't considered a technology leader anymore and very few are impressed by them, many see them as a dying company

derriz 4y ago
I don't think using IBM is an appropriate comparison. It is a company in actual decline - revenues peaked at about $110B just over ten years ago and were less than $60B last year. Like I said US manufacturing output is growing and has been growing. And I don't subscribe to a zero-sum view. Just because other historically poorer countries have grown economically doesn't hurt Americans (the opposite) or their way of life or standard of living. And just because other sectors of the US economy (like tourism for example) have grown more rapidly doesn't mean that US manufacturing is harmed - and certainly doesn't mean Americans are worse off in any absolute sense. Worrying about loss of stature is highly subjective and is more about feelings/pride/emotions/etc.
- ren_engineer 4y ago
  the US objectively loses a massive amount of foreign policy leverage by not being the largest manufacturer anymore, this is undeniable and obvious when you see how many countries are openly not sticking with the US with regards to Ukraine because they can just side with China, Russia, and India. The US has gone from 40% of global GDP in the 60s to less than 20%, they've lost relative power when it comes to global issues as a result of that.
  - derriz 4y ago
    The US has also gained immense power through growth in other sectors like finance/banking/insurance - the biggest sector in terms of US GDP. The second biggest sector - professional/business services - also allows the US to project immense power - particularly when combined with the fact that the US dominates global banking and finance. Looking at a table of US GDP by sector, what rebalancing are you suggesting would increase the ability of US to project power globally? For more Americans and US capital to be involved in manufacturing, some other sector will have to shrink. And manufacturing is already the fourth biggest sector.

Nasrudith 4y ago

People don't see industies where they don't work. Rising specialization and automation means that fewer are involver in industry. People are myopic and judge facts by feelings instead of using them as a proper guide of priorities.

peteradio 4y ago

I'm skeptical of those numbers although they may be wholly true, they may only be technically true because final "huge value add" simple assembly is done onshore while all the base parts are produced offshore.

taylodl 4y ago
Ford "assembles" cars - that's why they're called "assembly lines." Yes, any manufactured good of sufficient complexity will have at least one part coming from somewhere else in the world that specializes in making that part. That's not a bad thing. Insisting we make everything in the U.S. to be counted as being built in the U.S. is a huge step backwards. It is simply unreasonable to expect the U.S. to be the most efficient at producing everything. And if we're forced to accept such inefficiencies then we're necessarily lowering our standard of living.
- peteradio 4y ago
  I don't consider cars simple assembly, that has obvious value add when compared to a pile of parts. Fiber optic assemblies are expensive to buy but trivial to build from the inexpensive imported parts. Forcing purchasers of those assembled parts to buy onshore should count as an effective negative manufacturing GDP because it could have been purchased offshore fully assembled for cheaper. Perhaps there are good national security reasons for requiring onshore assembly of telecoms equipment but mixing it with economics statements is goosing.