Reality Check: U.S. Factory Jobs Lost Are Due Overwhelmingly To Increases In Productivity, And They're Not Coming Back

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According to President Trump's White House website:

For too long, Americans have been forced to accept trade deals that put the interests of insiders and the Washington elite over the hard-working men and women of this country. As a result, blue-collar towns and cities have watched their factories close and good-paying jobs move overseas, while Americans face a mounting trade deficit and a devastated manufacturing base.


By fighting for fair but tough trade deals, we can bring jobs back to America's shores, increase wages, and support U.S. manufacturing.

Here's a reality check (and fact check) for Team Trump, based on the conclusions summarized below from the research article "The Myth and Reality of Manufacturing in America" by Michael J. Hicks and Srikant Devaraj at Ball State University (emphasis added):

Manufacturing has continued to grow, and the sector itself remains a large, important, and growing sector of the U.S. economy. Employment in manufacturing has stagnated for some time, primarily due to growth in productivity of manufacturing production processes. Three factors have contributed to changes in manufacturing employment in recent years: a) Productivity, b) Trade, and c) Domestic demand. Overwhelmingly, the largest impact is productivity. Almost 88% of job losses in manufacturing in recent years can be attributable to productivity growth (see chart above), and the long-term changes to manufacturing employment are mostly linked to the productivity of American factories. Growing demand for manufacturing goods in the U.S. has offset some of those job losses, but the effect is modest, accounting for a 1.2% increase in jobs beyond what we would expect if consumer demand for domestically manufactured goods was flat (see chart).

Exports lead to higher levels of domestic production and employment, while imports reduce domestic production and employment. The difference between these, or net exports, has been negative since 1980, and has contributed to roughly 13.4% of job losses in the U.S. in the last decade (see chart). Our estimate is almost exactly that reported by the more respected research centers in the nation. Manufacturing production remains robust. Productivity growth is the largest contributor to job displacement over the past several decades.

Bottom Line: The great majority of US manufacturing job losses (88%, according to this study) are a direct result of increased productivity of America's factory workers, not because our jobs have moved overseas. And those factory jobs lost to increased productivity are never, ever coming back to America - unless, of course, Team Trump can somehow negotiate deals with the powerful forces of technological progress to slow the steady march of advances in labor-saving manufacturing technologies and "Make America Less Productive Again."

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