Contrary to popular myth, manufacturing output in the US has increased by over 30% in the past decade, and we’re still either number one or two (depending on the stats used) in the world. But what has changed profoundly is the employment in manufacturing. Not just the absolute numbers, which continues to drop (by a similar 30% in the past decade too), but also the type of opportunities within that industry. In the past, a manufacturing worker that showed higher than average motivation and work ethic had opportunities to rise through the ranks. That path has been almost completely cut off.
I stumbled unto this excellent article that profiles a 92-year-old family-run car parts manufacturer, and one of its workers, a 22 year-old woman. It spells out the reasons why manufacturers still have plants here (although what’s happened with Apple makes me wonder about the rationale), and the challenges of keeping a manufacturing business afloat. And it details the challenges facing Maddie (pictured above); despite an exceptional work ethic and motivation, her opportunities are profoundly limited. For that matter, her job may well be replaced eventually by the next robotic machine. If you have twenty minutes or so, it’s well worth the read, even if it won’t exactly cheer you up.
When did the Atlantic become a partisan web site?
The point about being unskilled labor is it isn’t a career choice. It is something you do for a few years. Young ladies in that article should marry the nice young man in the artice and they can have a life. Unfortunately, she’s probably go a future of Jesus and crystal meth coming up.
Interesting counterpoint:
http://www.latimes.com/business/la-fi-germany-middle-class-20120122,0,1551154,full.story
Thanks for the link. That article on Germany clearly spells out the differences. Coming from Austria, I’m quite familiar with the approach there (same as Germany). Quite a contrast indeed.
Your comment about her future is a bit harsh though (meth).
I was at a dinner over the holidays with a bunch of lean process consultants. Don’t ask — worst 5 hours of my life. But the one thing they kept on emphasizing was the personal destruction they saw in line workers.
If she can make it to 30 without serious drug, alcohol and pregnancy problems, she has a chance. That will take an exceptional person, or a lucky one.
what’s really ironic is the AUTHOR of that article probably made less than $200 for the reporting. Blogging and writing is just as dead end as assembly line work, although the tempatations of personal destruction are less.
“what’s really ironic is the AUTHOR of that article probably made less than $200 for the reporting.”
I’m pretty sure The Atlantic pays a bit more than that.
“Blogging and writing is just as dead end as assembly line work”
For me, its a hobby. But I’ve seen a number of former newbie writers at TTAC turn their start there into decent paying jobs with the national magazines, and with pretty substantial perks (free CTS-V for the year, etc) I think most of them would prefer it over assembly-line work, even if it didn’t pay well. I know I would.
Where is this “free CTS-V list” and how do I get on it?
Ask Jonny Lieberman at Motor Trend.
I didn’t see the partisanship in the article. What did you see that is? Honestly curious. It had struck me as pretty evenhanded.
It’s nice to believe that unskilled labor should only be a brief stop on the career path. In a perfect world that’s exactly how things would be. Problem is that there are a lot of people in this country who are willing to work hard but aren’t (not to put too fine a point on it) interested in learning enough to get skilled at anything. Decades ago it was relatively easy to earn family-supporting money despite this limitation. Now it is not easy.
I understand the mindset of the Germans in your LATimes article perfectly (I may be a 4th-generation American, but an ancestry full of Swabians is going to leave its mark……) If enough Americans were like that to influence public opinion in this way, we could be like Germany today. But we aren’t. For some reason, the combination of frugality and strong social services just doesn’t seem to resonate into American lifestyles or American politics. I don’t understand why, but it’s too bad.
I haven’t read the article yet (I need to close my browser and get back to work for the afternoon) but I think this comment is just about perfect:
“It’s nice to believe that unskilled labor should only be a brief stop on the career path. In a perfect world that’s exactly how things would be. Problem is that there are a lot of people in this country who are willing to work hard but aren’t (not to put too fine a point on it) interested in learning enough to get skilled at anything. Decades ago it was relatively easy to earn family-supporting money despite this limitation. Now it is not easy.”
Our economy has made (almost completely by now) the transition from the former (supporting a family on unskilled labor) to the latter (unskilled labor getting people absolutely nowhere) and too many people haven’t followed along, for a variety of reasons of their own or of others’ making. I’m not one of those who harp on “personal responsibility” to the point that I feel that society owes those with difficult circumstances no compassion at all (because it’s all due to “poor life choices”, doncha know), but to some extent, goofing off early in life can track you into a later life of hard work for little or no reward and no security–and that is more so the case now than ever before.
Case in point (and this is off the top of my head): Our unemployment rate has been around 8.5-9% for about three years (12% in California); among college-educated people, it’s 3.5-4%. Apply yourself enough to earn a degree, and although you may face some difficulties now and then, it’s unlikely you’ll wind up living under a bridge. (My own longest term of involuntary unemployment in the past 20 years? About six weeks.)
David Brooks thinks it’s because she didn’t keep her gams closed, the way Rosie The Riveter did.
http://www.nytimes.com/2012/01/24/opinion/brooks-free-market-socialism-.html?_r=1&hp
(I think Maddie’s kinda cute too…) Holla at your boy!
We have two children – a two-year-old and a two-month-old. I love my daughters, but the bottom line is that having children makes it extremely hard to pursue outside interests, and that includes job training or more education. It’s a tremendous amount of work, and I’m married. I can’t imagine how a single parent does it.
Like it or not, having a child at a young age, and out of wedlock, puts a person at a tremendous disadvantage in regards to education and career advancement. Maddie is a hard-working young woman with potential, but she is facing headwinds due to some personal choices that make her already challenging professional outlook even tougher.
And, like it or not, the Luke’s of the world, as young single men with a decent income and no children from a prior relationship, are the most desirable on the “marriage” market, which allows them to be choosier.
+1
Women’s empowerment and access to birth control is the #1 best (and cheapest!) thing we can do to improve the country and the world.
So says the urban, progressive, professional degree, childless 34.5 year old…
Get off my keyboard, cats!
And where were these sexy young things when I was in High School? Probably riding in that ’87 Turbo Thunderbird… somewhere in the back seat along Defiance County, Ohio sideroads…. 🙁
(pace educatordan!)
Hey Amigo, I feel your pain. I’m gonna be 35 in June and my first marriage ended after 10 years (I got married at 22). I have a masters degree and work in education so I think I qualify for some of the descriptors you used on yourself. I have no children but I’m marrying a wonderful 28 year old educated Latina on July 21st. (And she would like to have 6 sons! Ay, mi dios!)
Life does get better. Have faith.
Maybe we should go “party” with Jack Baruth sometime? Soon? (Before 7/21?) C-Bus, baby!
http://en.wikipedia.org/wiki/Columbus,_Ohio
Don’t worry about me, Amigo!
“Young single men with a decent income and no children from a prior relationship, are the most desirable on the “marriage” market, which allows them to be choosier.”
Te Comprendo? … 😉
Interesting read. Nice to know that some suppliers are still making a go of it.
I worked for a few companies that supplied auto parts makers with general automation. The pressure they describe is relentless, and I was glad to get out of the industry.
This brings to mind Springsteens lyrics “They’re closing down the textile mill across the railroad tracks” and how it’s lost most of the relavance because there are no more textile mills to close.
Indeed, an excellent article. Thank you for bringing it to my attention!
An interesting read. The one factor that I think the author glossed over was general cost of doing business. Standard has already migrated out of high-tax, high-regulation, high-wage New York and gone to a more hospitable business climate.
However, some things at the Federal level cause the same problems that Standard left New York over. Right now, the US has one of the highest corporate income tax rates in the industrial world. This and other factors have given the US a lot less of a competitive advantage in low-margin manufacturing than it once had. It is true that the environment is cleaner and workers have more protections than they used to. It’s all about making tradeoffs and finding the happy medium.
In my own field, I also see the growing cultural differences between the educated and the uneducated. In my parents generation, I knew multiple white collar people who never went to college, but they were bright and worked hard and moved up. This does not seem so prevalent today. I have read one societal critique where the growing chasm will be between the bright and the less bright, and that this will result in a sort of cultural self-selection that is starting to pick up steam. Not a pleasant thought.
Here in Soviet Canuckistan we have the lowest corporate tax rate in the developed world at 15%. And just what has this done for jobs growth? Sweet fanny adams, that is what. What it has done is shift the tax burden to working people while allowing the corporations to reap huge profits and sustain enormous cash accounts.
In addition, one of the biggest hurdles the USA has in competitiveness is the health insurance thing. It is an enormous cost to businesses and still results in million of uninsured or under-insured people.
+1
Charles Murray has a new book out, highlighting this trend, not bright v. not-bright, but educated and married v. not-so-much
http://online.wsj.com/article/SB10001424052970204301404577170733817181646.html?KEYWORDS=charles+murray
I haven’t the time to read the article yet, I’m looking forward to it this evening. It is a topic I’ve been tracking, so I’ll venture to offer a prediction.
I just posted this to the Simca article with the hands-free video:
http://spectrum.ieee.org/automaton/robotics/industrial-robots/french-self-driving-car-takes-to-the-road
You’ve probably seen the Google self-driving cars, they’ve logged 200K miles so far.
Self-driving cars are the most visible indication that robotics tech is actually getting to the low-skilled human level. There are videos on-line of robots in research labs that make sandwiches in an ordinary kitchen, fold towels from a pile, hike through steep wooded country, lots of other things.
My prediction is that in the next decade or two, we will see many if not most low-skill jobs in the developed world replaced by robots. These robots will be reach mass production and their cost will be less than the cost of a low-wage employee.
The US at least is not prepared to deal with the consequences of this. Both my kids have college degrees and are making barely more than minimum wage after a number of years in the workforce. You know kids like that too, not to mention the rest of us. I think it has already started.
This is a blog about interesting old cars, not social policy, and it’s hard not to have strong feelings about all this. So I personally don’t think the discussion belongs here. Just food for thought since Paul brought it up.
PS: To clarify, I’m not even convinced that lots more college educated workers can take up the slack. Knowledge workers compete at a global level. In my engineering job, I work daily with plenty of engineers in Taiwan, India, China and elsewhere who are as capable as our North Americans and Europeans.
Curbside Socioeconomic and Geopolitical Legacy of Globalization!!
“My prediction is that in the next decade or two, we will see many if not most low-skill jobs in the developed world replaced by robots. These robots will be reach mass production and their cost will be less than the cost of a low-wage employee.”
I’m not sure I agree. With the move to low cost regions, the trend has been towards less automation rather than more over the past few years.
Design the product so as much assembly as possible can be done with standard automated machines (for example, pick and place machines for electronics), and then use people for the rest. People are flexible, and have judgement – robots don’t.
The Atlantic makes it sound like the South never “Took” textile jobs. My mother, who is 88, worked in multiple mills in my city in New England, for about 15 years. All of them closed, and the machinery moved down south. Did anyone every wonder why New England has so many “Quaint” mill towns with “Quaint” abandoned mills?
Back then, the South was our China and Mexico. Someday some other place is going to “Take” Mexicos + Chinas jobs. Oh well.
Maddie better hustle up a more secure future. Her skill set is just a small cog in the machine. If you can train someone in 2 minutes how to do the job and 25 minutes on what a red or yellow light means, then it sounds like her job consists of not showing up drunk and not being color blind.
The textile mills began moving to the southern states in the 1920s, if I recall correctly. For many years, New England was a depressed region of the country, until it revived with high-technology companies in the 1980s.
The “Dukakis Miracle”! ????…
Also helped the good 🙁 folks at Bain Capital.
http://articles.chicagotribune.com/1988-05-23/news/8801010472_1_massachusetts-miracle-michael-dukakis-massachusetts-taxpayers-foundation
As long as there has been manufacturing capital has moved in search of cheaper and more docile labor. IIRC Jack Welch stated that the ideal factory is on a barge so you can move it easily.
“Capital Moves” by Jefferson Cowie traces how RCA moved manufacturing around the US and eventually to Mexico.
Only in the past 40ish years has cheap inter-modal freight allowed you to locate the factory on the other side of the world and not loose the savings to the shipping charges.
Growing up in the Midwest I had many relatives with manufacturing jobs, few of them work in that field or in the same plant for the same company anymore. My father’s brother has gone from manufacturing TV tubes (Philips/Sylvaina), freezers (Woods), a galvanizing mill (steel – a joint US Steel/Japanese venture), and now works in quality control for another company. He was fortunate to make the sacrifices he needed to make to continue to be trained and go to tech school. God knows when the man will be able to retire (he’s past 50 now.)
The future of manufacturing was summarized nicely in Minority Report’s Lexus factory:
http://www.youtube.com/watch?v=jRHlY5X2YFE
Skip to 1:45, or don’t skip and watch a pretty cool fight scene.
Reminds me of an old quote:
“The factory of the future will have only two employees, a man and a dog. The man will be there to feed the dog. The dog will be there to keep the man from touching the equipment.
-Warren G. Bennis”
Although I still stand by my earlier post about less automation…
Interesting articles. Australia is facing the same type of issues but with lower economies of scale. All sorts of manufacturing is going, you might have seen reports of government aid talks during the NAIAS, and textiles were largely gone at least a decade ago.
What is concerning me is the food-manufacturing plants that are closing down in many areas, where the food is still grown (for now). Some of it seems to be moving interstate, but some must be being replaced by the imported products appearing on supermarket shelves.
There are some ridiculous examples around too, a while back I bought a mop that was made in Germany & packaged in China – how can shipping it to China just to put a small plastic bag on the head be worthwhile?
Yeah I heard the Tomato sauce factory near Shep has been closed and moved to NZ It will probably land near here in Hawkes Bay.
All through history, textiles have moved from one low wage economy to another. America is simply too expensive to make shirts. Much better to use American labour to make bulldozers and a lot more profit in it, too.
Yes but then you could be making even more profit making bulldozers in Mexico or China…
A dead-end job is a dead-end job. People who make bad choices, however they do, tend to wind up in such jobs.
Coal mining used to be big in some parts of the country. Now, no boy ever grew up saying, “I want to mine coal, and get paid in scrip, and die of Black Lung at 50!” But boys who didn’t do well in classrooms or had no aptitude for skilled crafts, or who got married at the point of a shotgun…went down into the mines.
Now it’s this girl’s turn…Women’s Liberation has just shifted the costs onto the young women. She seems to have some things going for her; drive, some capacity for learning, supportive supervisors. But having children costs; and the wise person will plan when and how he or she has them.
As for manufacturing in America: That delves into raw, naked politics. The short answer is, we put roadblocks in the way of businesses who would open manufacturing plants; whereas many foreign nations do not.
And a manufacturer is going to set up where costs allow the product to sell at the pricepoint – and risks acceptable, if not minimal. Add to the costs, and increase the risks (witness Chrysler’s sham-bankruptcy, stiffing preferred bondholders and others) and plants will find somewhere else to go.
Prevent importation of such goods…and then the goods just don’t get built. Nobody’s going to buy $8000 iPhones.
The price difference on an iPhone is said to be around $65 if not made overseas – so the price would hardly be $8000.
The selling price is set by what people are willing to pay – so it would probably be about the same as it is today, and Apple would make $65 less on each one if made in North America.
I disagree. I would have paid $65 more for my iPhone if the price was set at that, it already cost me $200, that extra cost would not be a deal breaker and I do not think it would be for most others either. As long as I pay what everyone else pays more or less…
Apple has never been in the position of being cheaper than the competition. If they wanted to keep the manufacturing here they could have. The suppliers would have set up shop around their factory. Look at what happens in the auto industry. I don’t think it is that different.
Just a friendly comment. Some people have little or no control over their occupational destiny. Nobody wants to work in a store, factory, or coal mine. Sometimes, it just works out that way.
If you look back in history, men like Carnegie or Frick could care less about their workers’ lives. Henry Ford was one of the few that tried to improve the quality of life for his employees. A $5 eight hour day was a radical idea. Most of the robber barons disapproved of such things. They paid as little as possible, and created monopolies by reducing competion.
If sweat shop labor in China or elsewhere had been available during the Industrial Revolution, the capitalists would have built their factories overseas 100 years ago. The great immigration would have been to China, not the US. The US would have been an agricultural economy. But the greatest growth in US history resulted from sweat shop conditions for most of the population.
Unions brought a voice to the American worker, and ultimately caused the death of the American worker. The only way the individual American worker, like Maddie, will survive is for the US to enforce policy to punish companies for overseas activity. This is not likely to happen.
Until that happens, the only opportunities for the common person will be at Biggie Mart, or healthcare support fields to service an aging population.
Henry Ford didn’t initiate the $5 day because he wanted to make it better for the workers. He did it to stabilize his workforce; the job was hard and monotonous (still is) in the best circumstances; and the cantankerous Ford with his Service Department goons, made it a living hell.
The $5 day was a sort of bribe to stay; so as to eliminate his need to train men for the nearly 100 percent turnover each year he had up until that point. And it worked; and as he later stated in a lawsuit (his partners were suing to gain a greater share of profits) the high wage paid for itself in less than a year.
Let’s not romanticize history or reality. A business has its purpose; and providing work for employees is not one of them. And with government-run industries, where it IS a stated purpose…you wind up with a situation like Zastava (Yugo) was in, where nothing was streamlined and productivity was below measurement. And product becomes a joke.
A wage is is a function (mathematical term) of (a) how important the position is to whatever organization has it; and (b) how easily it is to replace someone. A highly skilled typewriter repairman, if there are any left, isn’t going to make a lot of money. But sanitation men often DO make a decent wage, at least partly because no one wants the job and yet it’s an important one.
If there’s a large pool of literate but unemployed people about, as there are now, and an assembly plant needs literate but only semiskilled help, wages are going to be low. Because it takes little to attract and keep and replace semiskilled help. Highly skilled personnel, engineers and company officers in finance, planning, legal, are another story.
Nor will unionization help – I remember the Denver area, I had a casual acquaintance who was a cashier at a Safeway there. Unionized. And making $7.99 an hour. Why? Because plenty of people were willing to work for it – Denver was a growing area at the time.
I have more to say on that, but we wander further and further off-topic.
As near as I could tell, the Apple article you linked said that China’s advantages are that they pay less per day than the US does per hour, and they keep their workers in dormitories so they can be rousted out of bed in the middle of the night, given a cup of tea, and sent to the line. Neither of those will work in the US, and as the Chinese get richer and older, they won’t work there either.
I didn’t see the link, but I take it is this article: http://www.nytimes.com/2012/01/22/business/apple-america-and-a-squeezed-middle-class.html?pagewanted=all
It’s interesting that most of the jobs associated with the iPhone are overseas – but most of the profits still flow to the US.
It’s not just Apple either, all of the top 10 global brands are US based, and none of the top 100 are Chinese: http://www.interbrand.com/en/best-global-brands/best-global-brands-2008/best-global-brands-2011.aspx
With wage inflation in China, I expect some of the low value add jobs to move to even cheaper areas like Vietnam or Thailand, so the future of the unskilled workers in China isn’t exactly secure either…
Re: Robots – They sure are coming. Nothing to stop them. Technology gets better every day and is growing exponentially. This site covers lots of interesting stuff, including robotics: http://singularityhub.com/ Advances coming are astounding.
Re: Maddie – Sure she made some bad mistakes but she sure is not a writeoff. (Everyone reading this has screwed up a few times. I sure have.) We have got to figure out how she can have a decent career path. I hate to say it but some sort of tariffs may be involved.
Many thanks to Paul and CC for posting this. Ties cars and our lives together nicely. Interseting to hear some educated views on the subject.
Sorry Paul, but article linked is completely, utterly, political. It puts a human face, a rather sympathetic one I admit, on a host of problems with society, education (rather the poor quality of it), economy, and business, but it is innately political. A discussion on this could go on and on and lead to very many soured moods. This is not the place for them. Therefore I won’t go into any details.
Peace.
I sure did miss something, partisan? innately political? Although it was anecdotal rather than a statistically exhaustive research study it seemed to present the relavent facts well enough. It also seemed to ring true to my own experiences with manufacturing in North America, China and Europe.
I humbly state that the article serves less to highlight the challenges of manufacturing in the USA, or the Sword of Damocles (or is it the Robot Arm of Damocles) hanging over unskilled labourers’ heads, than put on an emotional story that has narrow applicability. That the facts, such as they are, are well presented, I agree, but they are wrapped up in a human story that intends to evoke sympathy.
A discussion of the issues raised would very quickly go into what the Government should or shouldn’t do (tariffs? taxes? birth control? education?), which is though unfortunately the means to solve the problems, yet has no place on a classic car blog. To say that the article is partisan is incorrect, but its primary thrust raises issues that have purely political and social connotations, that are best discussed seriously elsewhere than here.
My takeaway from the article: now more than ever, it’s important to choose your future lest your future choose you. And there’s nothing at all partisan, biased, or political about that.
+1
I can speak from personal experience regarding education and manufacturing. After I got out of the US Army in 1972, a guy from the unemployent office told me that jobs in the steel mills were getting so skilled that a college degree was almost a necessity. In 1973, I got a job in a Pittsburgh steel mill. Believe me, a college degree was not needed. Guys who had college educations usually got white collar jobs due to family or social connections. Some college guys got manual labor jobs just because they had no connections or the jobs they could get outside the mill didn’t pay well. In 10 years, I rose to a machinist position, with no actual trade diploma. I was making $ 10 per hour, not including overtime amd holidays.
When the mill shut down in 1981, I returned to college and received a BA in Accounting in 1984 (Magna Cum Laude). In 1984, men over 30 were not a valuable commodity. With no real connections, the only job I could get was a minimum wage ($ 3.35) as a staff accountant for a one man operation. I worked there two years to qualify for a CPA license. Having a state CPA license did not seem to open many doors at 35 years old. I worked a few more jobs before becoming self employed with private clients. I made a modest living, but not salaries I saw 22 year old recent graduates with connections obtain.
The point being, education is no guarantee of success. That girl in the article has a job, hopefully a decent paying one. Even if she tries to better herself with education, she is at a marked disadvantage. She will be older, and probably no social or family connections to help her along. In the USA, (and the rest of the world) it’s a tough road up.
Look at our politicians and capitalists. The old boy network is here to stay.