The Truth About Manufacturing

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We constantly hear that if the US brings back manufacturing our ills with income inequality and underemployment would be resolved.  For sure the moving of our industrial base overseas is one of the primary reasons behind income inequality, lack of opportunity and stagnation of social mobility.  Each factory typically had an office attached with support staff.  Foreman, supervisors and managers were often recruited from the factory floor.  When the factory goes to China those jobs go to China.  Its not just the guys and gals with lunch boxes that get sent to the financial gallows.

 

Manufacturing is changing.  Repetitive tasks the hallmark of many former manufacturing jobs have now been automated away.  Modern factories are designed to use far less workers and accordingly fewer supervisors.  Moreover, its likely someone on a factory floor will be using a computer screen to perform production work.  That person might be required to have some knowledge of software use.

 

Manufacturing is no longer competing against other high wage manufacturing jobs.  The workers they will likely hire will be in the service sector making service sector wages, typically between $10 and $15 an hour.  Therefore, not a lot of incentive to pay much beyond that amount.  Add in that these new manufacturing jobs might be more likely to be full time with some levels of benefits and there will be no shortage of good applicants.  To illustrate a job paying $16 an hour will pay a little more than $33K a year.  Not exactly much of a paycheck to save for a house while still paying the monthly rent, paying a car note, covering health insurance and medical, food, and personal hygiene.  In other words barely scrapping by.  The average new automobile assembly worker is starting at $15.78 per hour.  (True more senior workers still employed are in the $28 to $38 an hour range).

 

The Democrats like to scream that a college education is the answer.  But then look at what many college graduates are doing and its not the be all answer the liberal elite claim it to be.  The trades are a partial answer but again how many underwater specialized welders are needed globally.  Even some of the trades are being and will be automated away.

 

The answer to this now more than decade issue of underemployment is complex and requires a total reworking of work, the work week and how we view work.  Unfortunately with companies making record profits, in part because they are employing fewer human beings, the stock market soaring and executive pay seeing annual double digit gains don't look for leadership in the private sector.  At least for now.  If aggregate demand begins to collapse possibly the business community might rethink this problem.  Government can't do this by itself and even if it could there's no incentive to do so. 

 

 

 

Comments

Stone-Eater Friedli Added Dec 8, 2017 - 2:23pm
George
 
Why is it that you tend to point out bad working conditions and injustice in the US since you're on WB and are still there ?
 
It doesn't help. Either you break out of all that shit or accept it.
 
I told you. No attack, friend. It's just an advice for the future.
Jeff Michka Added Dec 8, 2017 - 2:33pm
Why is it that you tend to point out bad working conditions and injustice in the US since you're on WB and are still there ?
It doesn't help. Either you break out of all that shit or accept it. I told you. No attack, friend. It's just an advice for the future-Because ol Geo is a whiner and complainer, not a doer because "nothing can be changed," so unless it's six-figures and a job, Geo has thrown in the towel.  Maybe ask him how Puerto Rico is doing to clarify matters for you.  And Geo will see your statement as a troll because you weren't telling him how wonderful and insightful he is, which is why he's here to begin with.
Stone-Eater Friedli Added Dec 8, 2017 - 2:43pm
Jeff
 
I told him there's jobs here in Senegal when one is ready to risk "security" on whatsoever. The new airport in Dakar has opened today and the coast will boom shortly. My piece of land of 500 m2 (small) I've bought for US$ 1'000 sold for 10'000 a year ago and hotels are building everywhere. We need multilingual people - accountants, receptionists, IT personnel who master original english operating systems.
 
Age is no deal.
 
And there's no bloodshed and terror here. When there would be - prisons are so heavy that people decide before taking action ;-)
Bill Kamps Added Dec 8, 2017 - 2:48pm
Unfortunately with companies making record profits, in part because they are employing fewer human beings, the stock market soaring and executive pay seeing annual double digit gains don't look for leadership in the private sector.
 
George, as you state quite clearly here, companies dont see a problem, therefore there is nothing to solve, in their mind.
 
Companies dont exist to put as many workers as possible to work.  Companies exist to make profits for their owners, with record profits, there is no reason to change what they do.
 
The answer to this now more than decade issue of underemployment is complex and requires a total reworking of work, the work week and how we view work. 
 
You make it sound like we live in a centrally planned economy, and the planners need to make some changes. There are no planners.  As you clearly stated, there is no incentive for companies to change, and government isnt going to start centrally planning the economy.
 
After all these rants, we get it.  You dont like how things are, and you dont like that we live in a more or less random economy. 
 
However, it isnt never quite as black and white as you paint it.  Yes we dont make clothing in the US anymore, but we make the most cars as we ever have, the most jet air craft we ever have, roughly the same amount of steel as we ever have.   It just takes FAR fewer people to do this.   As you more or less say, we could double the tonnage of steel that we make, and still not employ all that many more people.
 
Just like not as many people work on farms as did in the 1800s, not as many  people work in car plants as did in 1950.  We produce more food with fewer people, and we produce more cars with  fewer people. 
 
While we have moved lots of jobs overseas, foreign companies employ lots of people here.  As one example,  Mercedes employs some 30K people here, and that does not count all the employees at Mercedes dealers that are not Mercedes employees, but employees of family owned dealerships.  There are probably 200K people employed by the dealerships.  Are those low paying jobs? most are not I think.  If we drove the foreign cars from our borders, would we really gain that many jobs ?
 
If we shortened the  work week, assuming we could, people are going to make less money not more.   Companies are not going to pay people for 40 hours,  when they work only 20.  They will want to pay people less than half as much because of the increase costs in training, and managing twice as many people.
 
Economies are complex things, and I dont think anyone knows how to change the economy so it looks how you want it to look.   That is assuming that your economy would work better, and not worse than the economy  we have today.  I dont know of any planned economies that worked all that well.
 
Our economy,  has a lot of regulations and controls, but largely it is still the  result of millions of decisions that get made every  day by consumers, and by company owners. 
 
 
 
 
 
Stone-Eater Friedli Added Dec 8, 2017 - 2:48pm
BTW: I don't mind when people hesitate. Why ? Because people don't like to change environments easily. Friends, family might be far away. But then: We got planes - and: Better be worth something abroad than a zero back home, right ?
 
Millions of people in China, Africa and Europe dislocate to find a better life. Not only for a flatscreen but also for acceptance.
 
When you don't do it, it means to me that your life isn't as dreadful yet that you can't cope with it...
Bill Kamps Added Dec 8, 2017 - 2:56pm
Stone, nice comments.  Basically we all have to figure out a way to make things work where we are, or move some place where it does work for us.
 
Things are not dreadful in the  US, but a lot depends on your expectations.  Things are not as easy in the US for educated white people as they were in the  1960s.  But guess what, there is no place in the world like the US was in the 1960s. 
 
We have to change our expectations, and be more clever.  We cant just sit and complain and hope "someone" fixes things for us, because its not possible to produce the economy that George wants.
Bill Kamps Added Dec 8, 2017 - 3:07pm
George, you really should listen to yourself.  You want a shorter work week, and that basically will turn full time workers into part time workers.  That is one of the big things you rant against, the fact that people are working in a  gig economy.  If the average job was 20 hours a week, people would need multiple jobs, or gigs, to make enough to pay the bills. 
George N Romey Added Dec 8, 2017 - 3:21pm
Just like the financial system saw no problems with subprime loans, CDOs and derivatives until wow dude we got a problem. Companies see no issue until they dug themselves into a hole. It’s human nature to avoid the big ugly mess you are creating if for now it’s rolling  in the good times. Ask any former addict.
 
The point of the article is that a return to manufacturing isn’t the be all of ending income inequality. Not to mention we are going to need less humans.
 
In the 1930s the decade of the Great Depression the standard workweek shifted to 40 hours. Maybe we shift again or we don’t.
 
Maybe we see underemployment grow and we just accept and adapt to a poorer America. Or maybe we have massive social unrest like 1933 when FDR had to quickly give the country hope. I see no FDR on the horizon.
 
Stone I appreciated what you say but a major relocation would cost thousands and there’s a little issue with legal residency. For me it’s no practical solution.
 
Despite the moronic put downs of imbecile Mika I’ve had a very good life, few most do not get to experience. If I die tomorrow I’d die knowing I got more out of life than most. It’s the fight in me to make it better, which it could be. I’d like to think my Father watched other young men blown to bits in WW2 for something other than just the children of the ultra rich.
 
Government can’t solve the problems but to an extent they can help set the stage.  Right you have Trump and Obama before him claiming fame to a recovery that doesn’t exist.
Dissecting Leftism Added Dec 8, 2017 - 4:40pm
Trump proves you wrong
Jobs have shot up under him
George N Romey Added Dec 8, 2017 - 4:57pm
Yes the Obama type of jobs-low pay, gig, part time, temporary.
Jeff Michka Added Dec 8, 2017 - 5:00pm
Despite the moronic put downs of imbecile Mika I’ve had a very good life, few most do not get to experience. If I die tomorrow I’d die knowing I got more out of life than most. It’s the fight in me to make it better, which it could be.- Other than it's "too difficult" he really hasn't ever gone in the direction you've shown. He just bashes me because I don't buy into all his "excuses," he's yet to produce "reasons," a different animal.  AND I told him there's jobs here in Senegal when one is ready to risk "security" on whatsoever.-I know you have, but ol Geo is quit willing to live for back pats and "atta boys" on WB, and just wait for a nice six figure job to drop into his lap.  Few folks, with you and now Bill Kamps as exceptions, have actually questioned Geo's motive and motivation.  Most here go "I feel so sorry for you, Geo," which appears to be what he wants, since I suspect he's run outta people offline in his life to feel sorry for him.  Too bad, but that's what happens to long term whiners and do nothings.  Geo is Geo's worst problem, not "the Deep State" which is another pantry for his excuses. I've had to work too hard in my life to feel the least bit sorry for Romey, given his lack of action and run of words.
Jeff Michka Added Dec 8, 2017 - 5:02pm
Manufacturing, as it once was back in Geo's "golden age" of the 50s and 60s will never be back, partly for reasons Bill Kamp mentioned.  So yer screwed, Geo.
Bill Kamps Added Dec 8, 2017 - 5:10pm
Companies see no issue until they dug themselves into a hole.
 
I dont know if companies are digging themselves into a hole, or just minimizing costs, and maximizing profits.  Which is their goal.
 
Like any scenario, some companies will get it right some wont.  Look at what happened to GE over the past ten years, they basically failed.
 
Companies only have a problem if the economy collapses as you predict.  They are not predicting this. 
 
All Presidents claim success in the economy for which they played no role or a very minor one at best.  None of that is new.
 
You are correct, getting more manufacturing will not solve the problem, because it doesnt  take many workers to run the factories now.  It helps, but not all by itself.
 
Things are never perfect George, there were plenty of people in the 1960s saying there were problems, and there were.  There always are.  But there is not a place now like the US was in the 1960s, that was a passing situation.  No place on earth a person with a high school education can buy a house and two cars.  We still have it better than most in the US. 
 
The problem is always  trying to extrapolate the trends.   Trends have a way of correcting themselves, so we will just have to see.
Stone-Eater Friedli Added Dec 8, 2017 - 5:12pm
Bill
 
Things are not dreadful in the  US, but a lot depends on your expectations.
 
Yep......you know me and what I'd say LOL
Stone-Eater Friedli Added Dec 8, 2017 - 5:16pm
George
 
a major relocation would cost thousands and there’s a little issue with legal residency
 
a. Ticket - 1'000 US$ (probably, NY- Dakar)
b. Residence permit yearly 50 $.
c. Location per month average standard 300 $.
 
Reckon :-)
 
BTW: "Legal stuff" in Africa is not the same as legal stuff in the US. We're quite free down there. Probably more than the US definition of "freedom" LOL
Stone-Eater Friedli Added Dec 8, 2017 - 5:18pm
BTWII: In Africa, South America and Asia there's one saying: Government is ok, but good friends are more powerful....
Bill Kamps Added Dec 8, 2017 - 5:22pm
Stone, sure.  However, I dont presume to know what  is right for everyone.  Some people like air conditioning and others do not )))  I can be friends with both.
 
However, I think it is great you tell George to do something about his displeasure.  I am fine here, and to be honest I dont think George is cut out for Africa, he just likes to rant )   I dont think what George is doing is very healthy for him, if he is truly unhappy. 
 
None of can affect what is happening in the world.  We can adapt to the situation we are in, and do the best we can for ourselves and family.
Stone-Eater Friedli Added Dec 8, 2017 - 5:33pm
Bill
 
Recipe: When you're unhappy, change it. As long as you breathe, you have time ... whatever you do. As long as you know what to do :.-)
George N Romey Added Dec 8, 2017 - 6:42pm
Just look at retail and it’s not all connected to the net. On whole this is a good thing as it reduces our addiction to stuff. However ithrre is the human element. I spoke to a fairly young man the other day. He was one of the youngest in the apparel company he worked for to make District Manager, paying about $100K a year with bonus. Then the market tanked and the Company filed Chapter 11. Today day he’s an assistant manager at a pet store making $35K. He likely will never hit six figures again yet he feels lucky.
 
Do some research rather than talk on casual observations based upon a crowded restaurant. Our economy is not substainable and just like 1928 and 2008 those doing exceptionally well will be the last to know.
Jeff Michka Added Dec 8, 2017 - 9:38pm
Geo Romey whines: Do some research rather than talk on casual observations based upon a crowded restaurant. Our economy is not substainable and just like 1928 and 2008 those doing exceptionally well will be the last to know. -Ah, Geo....Bill got on your six...finally, some folks here, SEFa ND BILL KAMP ARE CHALLENGING YOUR "SURRENDER!! IT's USELESS," CRAP YOU NEED TO BELIEVE IN. You've been clear over time, so the "crowded restaurant" stuff is more deflection.  You have, over time made a mockery of the "support" lavished on you by WBers..."we're Soooo sorry for you!!" like wsucram15, and several others.  None of whom ever challenged your assertions.  You're busted.  When I read you really wanyed a war so younger folks got drafted, then KIA'd, Heavens!!! Then over 50s could get their jobs, I considered you just another turd.  You also talked up how you were working in hurricane relief, working with FEMA, but the big news was you might get a JOB paying six figures and rebuild Puerto Rico.  A job like that should go to someone there, not you, but you are what's always most important to Geo...Geo is most important, nothing else is, and that's fine, but when you try and de-legitimize people that actually do things, you become Geo, the intellectual fraud.  Just admit it and we can all move on.  Sure, you'll feel this is another troll, which is your primary deflector, but it's just "what it is."  You can neither except or admit it.
Doug Plumb Added Dec 9, 2017 - 5:19am
Remove the legal barriers to competition and the government relationship to private industry as well as the financial institutions complex tax structures and you clear a road for growth and productivity. If everyone payed a "poor tax" of 4 % or so, and all the soldiers came home from the foreign occupations we would be fine. Easily possible with monetary reform. Everything would start changing in weeks without those income tax deductions.
Micahel Dolan Added Dec 9, 2017 - 11:19am
Our president is trying his best to bring back a revival of jobs jobs jobs in America. So far very good-if the HATERS would stop blocking his economic agenda more good things for us would happen.
 
Hussein Obama had the worst economic numbers of all time, yet he still attacks our country day in and day out. Trump has to fight the corrupt swamp members day in day out.
 
President Trump is a leader and he is leading America into a rebirth of American power for all our enemies to see.
 
America-First---------PERIOD****
Jeff Michka Added Dec 9, 2017 - 11:52am
Duhlan the mindless Trump supporter sez: America-First---------PERIOD-You need to revive Charles Lindberg and the 1930s, Duhlan.AND you also say: President Trump is a leader and he is leading America into a rebirth of American power for all our enemies to see.-And they are so scared of the Orange garbage pail.So far very good-Yeah, maybe only tax cuts for the rich to show for the next three years.  What accomplishment!! I wonder, DUHLAN, IF YOU BEG THE ORANGE SMEAR, WILL HE TELL YOU HOW MUCH GOV'T MONEY IS SPENT SPRAYING HOW ORANGE EACH DAY? If he stops, Melanoma will get a break from peeing on him every night to wash it off.  Sad.  :-)
Jeff Michka Added Dec 9, 2017 - 11:55am
Hey, DUHLAN...Obama isn't president any more, as much as most would like him to be now, instead of your Orange IL Duce, you can't seem to get that right, save far right.Hussein Obama had the worst economic numbers of all time, yet he still attacks our country day in and day out.-Riiight. Another sane statement from a real political whizbang.
wsucram15 Added Dec 9, 2017 - 1:33pm
SEF..I never looked at it that way. Work. 
Come on George...Lets go. You be the finance guy and I will Assist in managerial, either do HR, learn the law or  work in financial accounting.
Micahel Dolan Added Dec 9, 2017 - 2:46pm
Hey Mich-Ka you sound like a miserable Bitch-Ka.
 
Barak Hussein Obama- Barry Soetero Jr.------
 
One in the same-A total fake-phony-fraud. One percent rise in our economy-eight years of a horror of his ego-maniac-sicko bending over for Iranian-terrorist. Barry Jr. gave his Muslim friends a billion dollars on the sneak.
Micahel Dolan Added Dec 9, 2017 - 3:11pm
mich-Ka-some of Barry's greatest hits.
 
Thanks to Barack O's recovery plan, American workers have been sleeping like babies. They wake up every couple of hours and CRY.
 
Barack-Vote Democratic. Its easier than working
Come on! I just answered,like eight questions. Barry Jr. to reporters.
 
A year intoObama's first term in office, unemployment is higher, the national debt is higher. Seven years later the pathetic Obama plan remained the same.
 
Obama said---I've now been in fifty-seven states-I think one left to go. Just Brilliant-Is He.
Jeff Michka Added Dec 9, 2017 - 5:24pm
Duhlan the Mindless Trump supporter sez:Hey Mich-Ka you sound like a miserable Bitch-Ka. Barak Hussein Obama- Barry Soetero Jr.-as to the rest of your two comments, that all ya got, leamo?  I almost feel sorry for you and should be nicer to those obviously mentally handicapped like you, Duhlan.  I guess i'M SUPPOSE TO GET ALL ANGRY AT YOUR BASICALLY MORONIC "INSULTS," EH?  ok, i'M ALL MAD AND ANGRY, JUST FOR YOU, PINHEAD. Like I said before,other sane statements from a real political whizbang, Duhlan.

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