Economists Warn That Manufacturing Alone Can’t Save Economy

Delisa Scales touches up locks inside Master Lock company in Milwaukee, Wis. (AP)

Earlier this month, the Wall Street Journal advised investors who put money in emerging markets like China in recent years to consider another country with a growing manufacturing sector– One that boasts skilled workers, cheap and abundant energy, stable institutions and a middle class that loves to buy things.

That country, is the United States. In March, manufacturing grew for the 32nd straight month, accounting for 37,000 of the 120,000 jobs added. And from the state house to the White House, U.S. factories are being pelted with tax breaks and incentives.

But some economists warn policy makers not to put all their recovery eggs in the manufacturing basket because even as manufacturing jobs are coming back the sector will provide far fewer jobs than are needed to make a real dent in the unemployment numbers.

New York Times: The Promise Of Today’s Factory Jobs

Guest:

Eduardo Porter writes the “Economic Sense” column for the New York Times and is author of the book, “The Price of Everything“

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charles

Putting faith in the “innovative” sector is a risky business.
If a company invests hundreds of millions in a facility that makes something, they’re less likely to pack up and move to a new, low-wage location because of the expense involved but a “tech” job can be exported to India in a couple of days.

Trusting innovators is fine as far as it goes but, quite honestly, it doesn’t go very far. Those jobs are only as secure as the Sergei Brins of the world care to keep them.
J Frog

Very interesting. We probably have NAFTA and other trade agreements to thank for much of this upheaval. It increased America’s overall standard of living but it created more competition for our low skilled laborers. Higher skilled labor and white collar labor…not so much. I would like to know how much these free trade agreements and worldwide labor competition have increased the wealth difference between our rich and middle-class? Anyway, no going back…even if we wanted to.
Jandchoch

In all the discussion about jobs and pay, where is the subject of “population”? Certainly as technology reduces the need for labor and the population becomes better educated, the need for labor (people!) diminishes. So is it just politically correct to avoid the obvious problem of too many people for too few jobs or has no one looked at this as a critical issue for the future of the economy and the country?