Technology and the Changing Landscape of American Manufacturing

It is no secret that the manufacturing industry in the United States has not exactly thrived over the past thirty years. Once a major part of the country’s employment market, manufacturing holds considerably less economic opportunity for Americans than it did even in the mid-90s.

The economic and technological forces working against the manufacturing industry today are significant. First, the global economy has created an increase in offshoring American manufacturing jobs overseas to countries like China and India where labor is cheaper and regulatory strictures are regrettably looser.

Second, new technological innovations have created an increase in automation, so the manufacturing jobs remaining on U.S. soil is out of the hands of American labor and over to machine processes, shifting the cost of manufacturing tasks away from the ongoing investment in employee salaries and over to one-time investments in new equipment with intermittent maintenance.

It’s not all doom and gloom for American labor and the manufacturing sector, though. While it’s true that there are fewer manufacturing jobs in the U.S. now than before, the previous decade has actually seen a rise in the number of American manufacturing jobs.

The bottom of the manufacturing job market came in the thick of the recession in 2010, with only 11.5 million Americans employed in manufacturing positions. By 2016, however, manufacturing had added 800,000 jobs to bring the number up to 12.3 million.

In addition to the rise in manufacturing jobs seen over the last decade, American manufacturing output has risen sharply in the previous two decades, with the sector putting out 47 percent more than it did at the turn of the century. The cause for this rise comes from the major advancements that have occurred in the information age with regard to robotics and other technological advents that have significantly improved efficiency and the quality of output.

Robots are becoming a major part of the American labor economy, and their presence is spreading beyond just the manufacturing world. In California, a seat of American technological advancement, driverless cars have been rolling out for the previous few years and integrating the extensive professional and recreational automotive culture there.

Industrial robots have similarly expanded beyond conveyor belt-style manufacturing processes like has been seen for decades in places like automotive plants to new processes in companies like Amazon and Google, where robotics technologies have been implemented to drive otherwise unreachable levels of output to keep up with consumer demand.

It would be disingenuous to suggest that the upsurge in robotics and automation is particularly good news for the American worker as we know it. While the manufacturing sector has recovered jobs from the bottom of the recession and manufacturing now puts out more than ever before, the outlook is still fairly bleak for manufacturing labor. The intersection of investment cost in automation and robotics and the output potential of new technologies favors investment in non-human labor, and that needle is never tipping back in favor of human manufacturing.

It would be equally disingenuous to suggest that the incredible levels of American manufacturing output economically benefit the average American. The rise in output comes from robotics and automation, and those machine processes do not fetch wages that then recirculate into the rest of the economy. Instead, the manufacturing sector generates more output than ever before while paying out less in wages; the owners of the means of manufacturing are benefitting at far greater levels than anybody in the labor market.

The simple fact is that the American job market is shifting away from manufacturing. While there was an uptick in manufacturing labor coming out of the 2010 recession, economists expect manufacturing jobs to fall by 2022. There will still be American manufacturing, but it will be technology-based; robots are becoming the new laborers, and flesh and blood Americans will have to adapt to other professional sectors lest they become obsolete.

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