We’re all familiar with the negative statistics about the state of employment and manufacturing in the United States. The consensus is that the US doesn’t manufacture anymore. But this simply isn’t true. US manufacturing is on the rise, and though conservative at present, the number of manufacturing jobs returning to the US is also on the rise.
When the Great Recession of 2008 hit, manufacturing in the United States took a plunge as did employment overall. The long-awaited recovery has been slow in coming, but it’s clearly here. And with it came a rise in manufacturing. But many were quick to note that employment numbers remain low. Why the disparity? One simple word: automation.
Robots are taking our jobs, it would seem. It’s no longer just Mexico and China competing with US manufacturing workers. While the numbers show that the US is actually manufacturing more than ever before, the jobs don’t seem to be rising proportionately because manufacturers are learning to automate much of the manufacturing process. In fact, according to recent statistics, North American producers bought 32% more robots in the first quarter of 2017 than last year.
So, while it’s good news that the US is more productive now than ever on the manufacturing front, the downside is that robotics are doing all the work. Right?
Jobs Rising Too
On October 6, US President Donald Trump declared a national day of manufacturing to celebrate the reshoring of manufacturing jobs from overseas countries like China. As labor costs rise in Asia, many companies are bringing those jobs back to the US, and, according to the numbers, they’re not only putting robots to work. These are real, human jobs coming back to the states. And Trump pushed through a reduction in corporate taxes from 35% to 21%, which his administration believes will lead companies to reshore, even more, manufacturing jobs. And whatever the reason, it seems those jobs are beginning to come back already.
In fact, according to the Reshoring Initiative, in 2016, more manufacturing jobs came back to the US than left. This is the first time in decades that the US has had a net gain in manufacturing jobs. It turns out that the rise in robots, while negatively impacting employment numbers, does not spell the end of American manufacturing workers. Automation is now working alongside manufacturing workers to increase production. A plant that employed 100 workers in the 1950s may now employ only 50 to produce the same output. Automation accounts for the difference.
But robots need maintenance, calibrating, and more. And many roles simply cannot be automated. So US manufacturing jobs are still vitally important to the American economy, and automation will not change this. Furthermore, in a sense, robots are actually increasing manufacturing jobs for Americans in that they are driving reshoring efforts that bring back production from overseas. With the massive shift towards reshoring occurring in recent years, the US added a net 25,000 manufacturing jobs. US workers are benefitting from the return of production plants, even though those plants include more automation and not as many workers as they once might have.