Where the lost jobs in industry in the USA

During the two decades from 1979 to 1999, the number of jobs in the U.S. industry declined from 19 million to 17 million in the next decade — from 1999 to 2009, this figure fell to 12 million because Of this sharp decline had the idea that at the turn of the century the American economy has suddenly stopped working, at least for men occupations “blue collar”.

But it would be a mistake to assume that prior to 1999, everything was in order. Jobs in industry disappeared in the previous decades. However, jobs that have disappeared in one region or one sector, usually were replaced (at least in absolute terms, not as a share of total employment) new jobs in other regions or sectors.

Take, for example, the career of my grandfather, William Walcott Lord, born in New England in the early twentieth century. In 1933, his company Lord Brothers Shoe Company in Brockton (Massachusetts) was threatened with imminent bankruptcy, so he moved her operations in the South Paris (Maine), where wages were lower.

Workers of Brockton was seriously injured because of his decisions, and generally because of the mass disappearance of relatively high-paying jobs for blue collar workers in the factories of southern New England. But in the overall statistics of their losses were compensated by winning the rural residents of South Paris, which is practically slave labour on farms for the sake of survival has gained a relatively stable job in a Shoe factory.

The happiness of the workers of South Paris lasted only 14 years. After the Second world war, the brothers of the Lord began to fear the beginning of a new depression, so they liquidated their farm and divided. One of three brothers moved to York, Maine; another went to Boston. My grandfather went to Lakeland, Florida, (it’s halfway between Tampa Bay and Orlando), where he speculates real estate and was engaged in nonresidential construction.

And again, the overall statistics have not changed much. Fewer workers making shoes and boots, but more workers engaged in the production of chemicals, construction and Assembly operations at Florida plants Wellman-Lord Construction Company, which, in particular, is engaged in processing of phosphates. From the point of view of employment in the country, Wellman-Lord Construction Company had the same net factor effect as Lord Brothers in Brockton. The staff were different, they lived in a different place, but their level of education and training were the same.

In other words, during stable, as is commonly believed, the post-war period jobs in industry (and construction) is actually massively moved from the North-East of the country and of the States of the Middle West States in the “Sun belt”. For residents of New England and the Midwest losing jobs then was as painful as for today’s workers job losses in recent time.

In 2000 years of jobs for American “blue collar” is more varied than disappeared. Until 2006, the number of jobs in the industry declined, and the building grew. In 2006 and 2007, the loss of jobs in the sector of residential construction was offset by growth in the number of jobs for blue collar investment-related business and exports. Only after the outbreak in 2008, the great recession, jobs for blue-collar workers became more to disappear than to change.

Such changes jobs, anyway, are observed almost constantly, so a more accurate picture can be obtained considering the jobs of blue collar as share of total employment, and not as absolute figures for the number of workers in industry at a particular point in time. And we will see a very large and powerful long-term decline in the share of industrial jobs in the period between world war II and our time. This means that the popular idea that the industry has long been stable, and then when I started to do successes of China, suddenly collapsed, are a lie.

In 1943, 38% of non-farm employment accounted for by industry because of the high demand for bombs and tanks at the moment. After the war normal share of industry in non-farm employment was approximately 30%.

If the US were a normal post-war industrial countries, like Germany and Japan, then, because of technological innovations, this share would be reduced from 30% to approximately 12%. But instead, she fell to 8.6%. The main part of this recession — to 9.2% — due to poor macroeconomic policy, which since the presidency of Ronald Reagan turned the US into a country with a deficit, not a surplus of savings.

As a rich country, the United States had to Finance the industrialization and economic development throughout the world, in order for developing countries to export buy industrial goods from US. Instead, the US took several unproductive functions, becoming a global financial Laundry service, insurer of political risk, and the owner of a currency of last resort. For developing countries with large dollar reserves means that they do not need to seek the assistance of the International monetary Fund.

The remaining part of the decline in the share of industrial jobs — from 9.2% to 8.6% — caused by changing patterns in international trade that is primarily due to the rise of China. The North American free trade agreement (NAFTA), contrary to what the U.S. President says Donald trump, virtually not contributed to a decline in the industry. Moreover, all these so-called “bad trade agreements” helped to seriously win the other sectors of the us economy; and while these industries have grown, the share of jobs in industry fell by only 0.1%.

In the era of fake news, artificially created social movements and deceptive anecdotes anyone concerned about our collective future needs to achieve the right numbers and report the correct figures to the society. As he said in his speech “House divided”, the first U.S. President from the Republican party, Abraham Lincoln: “If we first understand where we are and where we are going, we can better judge what to do and how to do it.”