ATM Robbery Sparks Ruminations on Capitalism

[JC]

Detroit would be an extreme example... of an old manufacturing model that was never updated and failed.  What and how we manufacture changes.

Blacksmith shops manufacturing horseshoes would be another example... It was replaced with something else.  Japanese and European auto manufacturers still set up shop here.

My great grandfather was a cooper... for a brewery... skilled labor then... out of a job now...

Silicon valley was covered in orchards prior to the manufacturing of PC components and microchips...

You really believe thats why Detroit is in the shape it is?  It has nothing to do with cheap overseas labor?  Seriously, your whole world view is a little whacked.

[BridgeTroll]

It has nothing to do with cheap overseas labor?

Nope.  What labor or industry from detroit has moved overseas?  If you look at the link I posted from the department of labor our labor rates are cheaper than Europes... stands to reason then that we would gain manufacturing from there eh?

Seriously, your whole world view is a little whacked.

  Right back atcha there shipmate...

[BridgeTroll]

Clearly US manufacturing is dead!

http://www.industryweek.com/articles/the_face_of_american_manufacturing_14159.aspx

The Face Of American Manufacturing
The United States is the world's most productive country, but the global landscape has changed dramatically in recent years and even more changes are on the way.

By David Blanchard

June 1, 2007

It should surprise nobody to learn that the number of U.S. workers employed in manufacturing has been on the decline over the past decade, with annual employment dropping from 17 million in 1997 to just over 14 million in 2006. Those are the hard, fast numbers that the U.S. Department of Labor's Bureau of Labor Statistics (BLS) compiles, and for some industry observers, those are the only numbers that are relevant to a discussion of the future of manufacturing in the United States. But what exactly is manufacturing? Are the people who make products for U.S. companies being paid more, or less, than they used to be? Are they better educated, or less so? What about their productivity -- is there any evidence that today's manufacturing workforce is doing a better job at making stuff than previous generations of workers? And what happened to those 3 million jobs, anyway? Let's find out.

First of all, "manufacturing" as defined by the BLS refers to "establishments engaged in the mechanical, physical, or chemical transformation of materials, substances, or components into new products." That includes all the industries typically thought of as manufacturers based on the North American Industry Classification System (NAICS) codes, including food, beverage and tobacco; textiles; apparel; leather and wood products; paper and printing; petroleum and coal; chemicals; plastics and rubber products; metals and fabricated metal products; nonmetallic mineral products; machinery; computers and electronic products; electrical equipment and components; transportation equipment; and furniture.


Manufacturing Jobs Are Down
Employees (in millions)


Source: U.S. Dept. of Labor, Bureau of Labor Statistics

The dramatic decline in manufacturing jobs is a relatively recent development. Over a 20-year period from 1982-2001, according to BLS statistics, the number of people employed in manufacturing in the U.S. fluctuated modestly between 16 million and 18 million. It wasn't until the recession at the beginning of this century that employment dipped into the 15 millions and then into the 14 millions. Thanks to a steady dip throughout this decade, it's quite likely that manufacturing employment could drop into the high 13 millions by the end of 2007; preliminary numbers for March 2007 put the total at 14.03 million, the lowest employment level since 1950, more than a half-century ago.

Total employment figures only tell part of the story, though. The percentage of U.S. workers employed in manufacturing has dropped from 16.5% in 1987 to 10.8% today. Even so, as the National Association of Manufacturers (NAM) points out, when you consider that manufacturing accounts for $1.5 trillion in gross domestic product (GDP), if U.S. manufacturing was a country, it would be the eighth largest economy in the world. In fact, three manufacturing sectors -- food and beverage, computers and high-tech, and transportation/motor vehicles -- account for roughly 30% of the total manufacturing GDP.


Productivity Is Up
Percent change from previous year


Source: U.S. Dept. of Labor, Bureau of Labor Statistics

The most significant counterbalance to the drop in total employment has been the dramatic rise in productivity. Indeed, during the recession years, productivity (as measured by output per hour) rose by 7.0% in 2002 and 6.2% in 2003. According to NAM, over the past two decades, manufacturing productivity has grown by 94%, considerably faster than the rest of the U.S. business sector, where productivity grew by 38% over the same period.
Although the total number of people employed in the manufacturing industry continues to shrink, their compensation has been on a steady rise, evidence that productivity pays off in terms of higher salaries. As of 2005, the average full-time manufacturing employee earned $50,180, according to the U.S. Department of Commerce's Bureau of Economic Analysis (BEA). That represents an 11.8% gain since 2002. The typical manufacturing manager earns $106,588, according to the IndustryWeek 2007 Salary Survey.

Production workers tend to be much better educated than their counterparts of years past. The NAM cites statistics that indicate the number of high school graduates working at manufacturing facilities has steadily risen by 10% over the past three decades. Today, nearly 50% of production workers finished high school, and roughly 25% have attended college, though less than 10% have degrees.


Salaries Are On The Rise
Average hourly earnings of production workers



Source: U.S. Dept. of Labor, Bureau of Labor Statistics

However, as production becomes more specialized and more reliant on precision machining, there is concern of a widening skills gap between what young people are learning in school and the specific needs of manufacturers. According to a NAM/Deloitte Consulting study, 80% of manufacturers anticipate a shortage of skilled production workers over the next couple years, while 35% believe there will also be shortage of scientists and engineers.

In terms of demographics, more than 10% (1.5 million) of the country's manufacturing employees work in California. Texas comes in second place with just under 900,000 employees, followed by the traditional Rust Belt states: Ohio, Illinois, Pennsylvania and Michigan. Nearly every state lost manufacturing jobs during the recession earlier this decade, with the exception of Alaska (percentage-wise, the fastest growing state for manufacturing, though total numbers still have Alaska in 49th place), Nevada and North Dakota.

During the recession years 2001-2004, 34 states saw a double-digit drop in total manufacturing employment, but since then, according to the BLS, employment has stabilized in most parts of the country. In the past couple years, 23 states have seen employment gains, and only 12 states saw their employment drop by more than 1%. Percentage-wise, the two hardest hit have been Michigan (3.1%) and Rhode Island (3.0%)

Over the past decade, again according to the BLS, although the total number of women employed in manufacturing has fallen, the total percentage of women in manufacturing has actually risen by 2%, from 29% to 31% of the workforce. When it comes to running their own companies, while women have at least 51% ownership of roughly 30% of all companies in the United States, their interest in owning manufacturing companies is extremely small. According to the Center for Women's Business Research, of the 7.7 million companies owned by women, only 0.1% of those are manufacturing firms, or fewer than 8,000 firms.

Perhaps the single-most controversial question facing the U.S. manufacturing sector is: Are the 3 million manufacturing jobs lost since the recession due to increases in productivity, or due to foreign trade imbalance? As you might expect, there is no clear answer to that question. According to the BEA, foreign investment in U.S. manufacturing is roughly $100 billion more than U.S. investment in foreign manufacturing. NAM estimates that one in 12 U.S. production workers is employed by a foreign-owned company. Thanks to its open-market policies, the United States also attracts more foreign investment overall than any other country, including China. Seen in that light, the United States seems to be doing just fine by global trade.

On the other hand, there's the trade deficit -- $765 billion in 2006 -- and contained within that amount is another number -- $232 billion -- which represents the United States' trade deficit with China alone, an all-time high for U.S. trade imbalance. What's more, based on current trends, China is poised to overtake the U.S. by the end of 2007 to become the world's second-leading exporter of goods, behind Germany (and pundits likewise predict China could overtake Germany by 2008).

Many of the millions of laid-off production workers in recent years ended up shifting into lower-salaried service jobs, while U.S. manufacturers relocated production facilities to low-cost countries. That strategy helped shorten the recession in the short term, but there's a real fear that in the long term, U.S. manufacturing may be mortgaging its future by permanently offshoring production. Many are hopeful that the Bush Administration, prodded by the new Democrat-led Congress, will respond to U.S. manufacturing's plight by getting tougher on China's trading practices.

In any event, the United States remains the largest manufacturer in the world in terms of total output, and while the country faces numerous challenges both domestic and abroad, that No. 1 status is not likely to change any time soon.

[buckethead]

Interesting, BT. Thanks for doing the footwork!

Is new home construction considered manufacturing? Additionally, I am dying to know what type of construction, and what function specifically does JC perform?

If the Bronx (and greater NYC) was JC's former primary arena of operation, it seems unlikely that single family residential would have been the type of work being done.

[BridgeTroll]

My guess is no...

First of all, "manufacturing" as defined by the BLS refers to "establishments engaged in the mechanical, physical, or chemical transformation of materials, substances, or components into new products." That includes all the industries typically thought of as manufacturers based on the North American Industry Classification System (NAICS) codes, including food, beverage and tobacco; textiles; apparel; leather and wood products; paper and printing; petroleum and coal; chemicals; plastics and rubber products; metals and fabricated metal products; nonmetallic mineral products; machinery; computers and electronic products; electrical equipment and components; transportation equipment; and furniture.

[BridgeTroll]

It makes JC's point.

I dont think it does... unless of course you mean forcing companies to keep unproductive factories in production in order to overpay unionized workers demanding pay and benefits that cannot be met.

In that case... It does make JC's point.

[buckethead]

I believe Stephen is suggesting that the decline in manufacturing positions, coupled with the increase in productivity and production is primarily due to technological advances. (Not so much exporting manufacturing to China et al)

As manufacturing becomes more automated, fewer, and more highly skilled/educated "workers" will be required.

It seems he is asking JC what is to become of the "worker" as defined by marxist theory, when technology virtually eliminates manufacturing (as we knew it throughout the industrial revolution) ?

[BridgeTroll]

This is why it is so difficult to have a discussion with you also Stephen.  The article makes many points... That you and JC tend to focus on the pessimistic rather than the positive is hardly surprising.

You left these points out...

The most significant counterbalance to the drop in total employment has been the dramatic rise in productivity. Indeed, during the recession years, productivity (as measured by output per hour) rose by 7.0% in 2002 and 6.2% in 2003. According to NAM, over the past two decades, manufacturing productivity has grown by 94%, considerably faster than the rest of the U.S. business sector, where productivity grew by 38% over the same period.

Although the total number of people employed in the manufacturing industry continues to shrink, their compensation has been on a steady rise, evidence that productivity pays off in terms of higher salaries. As of 2005, the average full-time manufacturing employee earned $50,180, according to the U.S. Department of Commerce's Bureau of Economic Analysis (BEA). That represents an 11.8% gain since 2002. The typical manufacturing manager earns $106,588, according to the IndustryWeek 2007 Salary Survey.

Production workers tend to be much better educated than their counterparts of years past. The NAM cites statistics that indicate the number of high school graduates working at manufacturing facilities has steadily risen by 10% over the past three decades. Today, nearly 50% of production workers finished high school, and roughly 25% have attended college, though less than 10% have degrees.

In any event, the United States remains the largest manufacturer in the world in terms of total output, and while the country faces numerous challenges both domestic and abroad, that No. 1 status is not likely to change any time soon.

[BridgeTroll]

I believe Stephen is suggesting that the decline in manufacturing positions, coupled with the increase in productivity and production is primarily due to technological advances. (Not so much exporting manufacturing to China et al)

As manufacturing becomes more automated, fewer, and more highly skilled/educated "workers" will be required.

It seems he is asking JC what is to become of the "worker" as defined by marxist theory, when technology virtually eliminates manufacturing (as we knew it throughout the industrial revolution) ?

And as I have been trying to say... the worker must evolve along with manufacturing.  Detroit is an example of old style brick and mortar assembly line manual labor intensive manufacturing.  It is a model that is being replaced.

JC contends... "manufacturing is clearly dead".  I contend the the opposite.  Manufacturing is retooling... reinventing and becoming more efficient.  It is not dead or dying... it is alive and evolving.

JC contends that "all our jobs are being shipped overseas"... with global trade being the culprit.  According to the article while some jobs are exported others are imported...

According to the BEA, foreign investment in U.S. manufacturing is roughly $100 billion more than U.S. investment in foreign manufacturing. NAM estimates that one in 12 U.S. production workers is employed by a foreign-owned company. Thanks to its open-market policies, the United States also attracts more foreign investment overall than any other country, including China. Seen in that light, the United States seems to be doing just fine by global trade.

[JC]

Interesting, BT. Thanks for doing the footwork!

Is new home construction considered manufacturing? Additionally, I am dying to know what type of construction, and what function specifically does JC perform?

If the Bronx (and greater NYC) was JC's former primary arena of operation, it seems unlikely that single family residential would have been the type of work being done.

JC is a commercial/industrial carpenter, he mostly installs metal framing, drywall and acoustical ceilings, basically an interior systems specialist.  However JC is also a talented drywall taper as well a concrete from fabricator and mediocre concrete finisher.  JC has worked in a range of work places, from hospital ORs to paper mills as well as some of the sidewalks you walk along in downtown Jacksonville, most notably at the foot of the Acosta Bridge.  JC has also performed the function of foreman, general foreman and superintendent, and project manager in the audio video integration field.  In spite of his management experience, JC just wants to be a working person, he enjoys the comradery built from getting a difficult task done with team work and gets great satisfaction from building things.

When JC was in NY he mostly worked in Manhattan, at the Fed, Columbia Presbyterian, Lincoln Center and Columbia University.  As a pm JC worked at Conde Naste Publications, The Bank Of America Tower to name a few. 

[buckethead]

I thought I had seen an indication that you were female in a previous post/thread. My apologies. I intended no disrespect.

I have been doing sinlge family and to some degree multifamily residential carpentry (new construction and remodeling) for the past twenty years. For 15 of those, I have been self employed.

In the small world of construction in which I operate, one rarely encounters Marxist theory (or any variation). I know there are carpenters unions around town, but have never met a union carpenter, to my knowledge.

I do hope you find enough work that pays well to contintue to support your family. It seems to me, there have been more opportunities lately than in recent memory. Things might be inching up.

Have you never considered becoming self employed? You could certainly build the very workers model you seem to think would serve carpenters better. In order to work, it would require only productive and responsible workers, which due to prolific alcohol and drug usage among construction workers, can be a tall order.

I tried such an endeavor (an employee as partner business model) circa 1998. It failed and I was left to clean the mess which elevated me into the role of a business owner.

[JC]

I thought I had seen an indication that you were female in a previous post/thread. My apologies. I intended no disrespect.

I love women so its ok if you confused me for one.

I have been doing sinlge family and to some degree multifamily residential carpentry (new construction and remodeling) for the past twenty years. For 15 of those, I have been self employed.

In the small world of construction in which I operate, one rarely encounters Marxist theory (or any variation). I know there are carpenters unions around town, but have never met a union carpenter, to my knowledge.

Carpenters unions stupidly gave up the residential market long before I came around so I am not surprised you haven't seen any but there are about 600 members of carpenters local 627, they work for WW Gay, MJ Woods, JC Stanford, Center Brothers and a few other small contractors.

I do hope you find enough work that pays well to contintue to support your family. It seems to me, there have been more opportunities lately than in recent memory. Things might be inching up.

There are some good signs in NY, this is a project that just broke ground in Brooklyn, I would live in a cardboard box to work on this one.




an outline of the scope of the project.

http://en.wikipedia.org/wiki/Atlantic_Yards

and there is the Coney Island renovation which will also be huge.



Everything in those images would be new construction, barring a few Coney rides.

Have you never considered becoming self employed? You could certainly build the very workers model you seem to think would serve carpenters better. In order to work, it would require only productive and responsible workers, which due to prolific alcohol and drug usage among construction workers, can be a tall order.

I have considered it and have been self employed before, only as a retailer (miserable failure LOL)  not a construction worker.  I have also hustled my own jobs in the past and I enjoyed it I just dont know how good the market is to start anything right now.  Because I have so much at stake I cant risk losing what I have now over something so unstable.  But I am going to school anyway, I say that but its online school for web design so I need to mainly focus on that at the moment.  If I did own my own business I would want to specialize in something like decorative ceilings or concrete counter tops, something artistic where every installation is unique.

I tried such an endeavor (an employee as partner business model) circa 1998. It failed and I was left to clean the mess which elevated me into the role of a business owner.

Thanks for the encouraging words!

p.s. Marxist Theory relies too much on a centralized power structure, too much hierarchy for my taste.  It also relies on the state to educate, and it attacks the traditional family structure.  Again, I refuse at this point to use the label associated with this political/economic theory because there is so much crap attached to it and every discussion will be about said crap along with a myriad of lies.  I am no Marxist...

[JC]

You see the difficulty, JC.  Thanks buckethead for summing up the question again.

Anyways, Im intrigued to hear your thoughts on the possibility of a Post Labor world.  It something that has never been seriously considered in its socio economic ramifications outside the rare air of technocracy.

Ok, so I must be honest and admit I have never really considered this either but I have been mulling it over for a day+ now.  I did not do any research because you asked for my thoughts and you will get them, more accurately, more questions.

To start, as I pointed out earlier there will be jobs for trades people for the foreseeable future, you questioned whether there would be enough to be a "class" my answer is that I dont know.  But what I hope for is that the concept of "classes" are eliminated long before the people in those classes are eliminated, Utopian, I know.

I do think we are starting to see signs of what things will look like in the future if there are less and less good paying manufacturing jobs and it is a further concentration of wealth, the growing reliance of government to tax that wealth and then of course redistribute it in the form of welfare, food stamps, medicaid/medicare.  I guess what it boils down to is that I think this current path is unsustainable...

[Dog Walker]

Manufacturing jobs might be automated out of existence; agricultural jobs were mechanized away in the first third of the last century, but service and technical jobs are not going to be.  Robot going to cut your hair, change your tires, build your deck?  Don't think so.

Henry Ford and others turned manufacturing into something that required no education, no knowledge, just muscle and the willingness to put up with hour after hour of mind-numbing, repetitious actions.  They HAD to pay high wages to get people to do it.  It's robot work.

Low end service jobs are about the same (burger-flipper at the arches), but most service and technical jobs require a lot of skill and knowledge that requires training and education.  If you think waiting tables is an unskilled job, you've never done it.

Cut your hair, install your computer network, groom your pet, fix your air-conditioner, build your house, tune your car are all skilled TRADES, not just labor.  Brains added to physical action.  Can't be outsourced either like a lot of pure brain work is being.  My electrician and my plumber make a comfortable living, work for themselves and have huge job satisfaction.

We adjusted when field hands were no longer required to hoe the fields and swing the scythes.  We can adjust when robots build our cars and TV's and have to be serviced by skilled trades people.

Human's should not have to do robot work. Is there anything more dehumanizing than an assembly line?

[Sportmotor]

Human's should not have to do robot work. Is there anything more dehumanizing than an assembly line?

McDonalds, Burgerking, Tacobell, Arbys...