aside President Lies About The Real Reasons For Loss Of US Manufacturing Jobs, Part I

Image result for photos of german auto manufacturing plants in the USATo hear the way the Republican President Donald Trump tells it, the USA is losing manufacturing jobs because company executives have been moving jobs out of the country while omitting the fact that most manufacturing jobs are being replaced because of advances in technology like automated and robotic systems.

The president is looking to the past, when he promises coal miners that he is bringing back coal mining jobs when the energy companies have moved on by preferring to utilize renewable sources of energy.

When the president plays tough cop on immigration to where farmers can’t hire enough migrants to pick the crops, the farmer who cannot find US workers is being forced to resort to automated systems as well.

The president’s complaint about the US having a trade deficit with Germany doesn’t take into account the number of German autos which are being manufactured in US southern states and providing US workers with good paying jobs.

The president’s age, his resistance to reading to keep up with the news (cable is not enough); his lack of curiosity and lack of a subjects’ depth is what will cost the US jobs in the long run.

Image result for photos of german auto manufacturing plants in the USAHere is the rest of the story…

On 3/26/17, Brian Heater of the Teckcrunch.com penned the following report, “Technology is killing jobs, and only technology can save them.”

Excerpts:

“In the recent presidential election, automation and robotics got a slight reprieve from the accusations that it has been the key driver in job losses in the United States. During the campaign, the conversation shifted, thanks largely to then-candidate Trump’s masterful scapegoating of Mexico and China, while calling out trade deals like NAFTA and the Trans-Pacific Partnership as clear and present threats to U.S. manufacturing.”

Image result for photo of president trump at manufacturing company
trump at mfg co

“Indeed, the administration continues to downplay automation as a factor in the U.S. economy, because that explanation runs against the political policies it hopes to enact under the guise of improving the conditions of America’s workforce. On Friday, Treasury Secretary Steve Mnuchin dismissed the prospects of artificial intelligence and automation eroding the workforce. In an interview with Axios, Mnuchin said:”

“it’s not even on our radar screen…. 50-100 more years” away. “I’m not worried at all” about robots displacing humans in the near future, he said, adding: “In fact I’m optimistic.”

“But even as some politicians look to divert attention from the issue, public focus returned to the evils of automation. The New York Times ran a story titled “The Long-Term Jobs Killer Is Not China. It’s Automation,” while the Associated Press explained “Why robots, not trade, are behind so many factory job losses.” You get the picture. Technology is killing manufacturing jobs.”
Image result for photos of robotic and automated systems in manufacturing companies“And there’s truth in all of these reports. Robotics and automation have been linked to lost manufacturing jobs in the U.S., and even the most pro-technology industry analysts would have a hard time disputing it. But that simple fact raises some complicated questions.”

“Are we living in historically unprecedented times for job loss? Or is this part of a cycle that predates even the Industrial Revolution? Is it possible to retrain our workforce for these changes? Or will the gap between educated and non-educated workers only continue to grow?”

“This exceedingly complex issue has no simple solution, and any attempt by politicians to villainize or sensationalize matters will only serve to further its negative impact. Industry and government alike need to take a long, hard look at the effect of automation on industries as a means of maintaining the United States’ role in manufacturing and innovation, while stemming domestic job loss.”

Related imageJob loss

“A number of representatives of pro-automation companies and advocacy groups I spoke with used words like “scaremongering” to describe a spate of recent reports that have raised alarm around the role of robotics in job loss. But when pressed, those same organizations will ultimately acknowledge that automation has been a driver of factory job loss in the U.S., at least in the short term.”

“It’s pretty simple arithmetic, and something we’ve witnessed time and again. A much-cited Ball State University study suggests that automation has already proven a major driver of job loss this millennium. The paper notes that the decade between 2000 to 2010 marked the U.S.’s largest decline in manufacturing jobs in its history.”

Image result for photos of robotic and automated systems in manufacturing companies“Those numbers are supported in part, by statistics from the Bureau of Labor Statistics, which notes that manufacturing jobs in the U.S. increased between 1994 (the year NAFTA went into effect) and 2000. After that, however, things look decidedly less rosy, with a loss of five million jobs in the intervening years. In spite of this troubling stat, productivity actually rose, according to Ball State’s report.”

“That study only chalks up 13 percent of job loss to trade during that period, with automation constituting a major portion of that remaining job loss. “In 1998, the inflation-adjusted output per worker was much lower than it is today,” write the study’s authors, Michael J. Hicks and Srikant Devaraj. “This is due to a variety of factors, chief among them being the automation and information technology advances absorbed by these sectors over this time period.”

Image result for photos of robotic and automated systems in manufacturing companies“Colin Parris, the vice president of Software Research at GE, is refreshingly straightforward when speaking to TechCrunch about the topic. “Yes,” he says, matter-of-factly, “there will be job losses.”

“It’s blunt, sure. But it’s refreshing coming from an executive at a company so heavily invested in automation. But Parris’ story, naturally, doesn’t end there. His long-term projections — and those of his peers in manufacturing — are actually a fair bit sunnier.”

“The only way to fight (job losses),” Parris continues, “is to train the talent that we have. Because in the future, we have to embrace robotics. It allows us to reduce cost. If I reduce cost, I have more money that I can use for innovation. The more money I have, the more new products I can create. The more products I create, the more workforce I can hire.“
Related image

” At the turn of the last century, 41 percent of U.S. jobs were in or around agriculture. A century later, the number had plummeted to 1.9 percent.”

“And while technology adoption and its attendant short-term job loss certainly transformed those historical economies, that evolution of work didn’t lead to mass unemployment as much as a transformation of the work being done. Changing times have traditionally closed doors and opened windows, as the old adage goes. As one representative of a major technology firm handily pointed out on background, the number of jobs that have been completely eliminated by automation boil down to one key position. It’s a sentiment backed up in a Boston University study released in late 2015.”

Image result for photos of robotic and automated systems in manufacturing companies“[T]echnology rarely automates major occupations completely,” writes the paper’s author, James E. Bessen. “Many occupations were eliminated for a variety of reasons. In many cases, demand for the occupational services declined (e.g. boardinghouse keepers); in some cases, demand declined because of technological obsolescence (e.g. telegraph operators). This, however, is not the same as automation. In only one case — elevator operators — can the decline and disappearance of an occupation be largely attributed to automation.”

So, if you work or live on a floor higher than three, maybe pour one out for the poor elevator operator, whose numbers seemed to have peaked at around 1950 when 97,000 were registered in the U.S. census and are virtually non-existent today.

“If it’s assumed that job automation has and will continue (in the short term, at least) to result in some form of job loss, automation’s defenders point out that many of the jobs that will ultimately be displaced will be jobs that “no one really wants,” or at the very least, positions that employers have difficulty keeping staffed.”

Image result for photos of german auto manufacturing plants in the USA“It might take employees out of what we call the ‘three Ds,’ a dull, dirty or dangerous job,” says Bob Doyle of the Association for Advancing Automation. But “[it] puts them hopefully in a different position that creates more value to the company,” he added.”

Parris also cites the “three Ds” — referring specifically to flare stacks used to burn off the flammable gas from drilling operations in the Bering Sea. “These flare stacks are exposed to the elements because they’re out in the ocean, and you have to have people climb these things and look to see if there’s rust and corrosion,” Parris explains. “Who wants to do that? They’re dull, dirty and dangerous. It’s a huge problem.”

“On a recent visit to the Massachusetts offices of industrial robotic gripper maker Soft Robotics last month, I put the question of replacing human labor with robots to CEO Carl Vause.”

Related image“There’s a labor shortage in packaging, so we’re working with customers in companies where they don’t have enough labor to staff their factories,” he answered, he says. “A lot of these companies have temporary labor constantly coming and going and worrying about training and quality and all of those challenges. So, what we’re looking to automate is packing dough in a 40-degree warehouse. It’s not a good job, it has a high turnover.”

“However, MIT economist David Autor takes issue with the notion that automation is simply replacing jobs that no one really wanted in the first place. While most of the roles displaced by technology were not particularly glamorous, they were still staffed by humans requiring steady employment to make ends meet.”

“I don’t think that automation will mean the end of work, but I do think the distribution consequences have been quite significant, and I do worry about those,” Autor says. “I think the set of good jobs available to low educated or non-college educated workers without specialized skills is definitely contracting.”

Image result for photos of german auto manufacturing plants in the USA“Autor, while not as apocalyptic in his vision as some of his peers, does consider growing professional dependence on machines a major contributing factor to the growing income gap between rich and poor. And it’s a vicious circle, as growing unemployment makes it difficult or impossible for workers to enroll in the education required to break out of poverty.”

“I think automation has had an absolutely enormous effect on the structure of work, the returns to skills and what people do with their time,” says Autor. “I don’t think it’s created mass unemployment so far, and I don’t think it will. But it has dramatically reduced the set of opportunities available to uneducated workers. And I think that’s having very significant social and even political consequences.”

Image result for photos of german auto manufacturing plants in the USAShort versus long term

The conventional wisdom among economists holds that, while there may be some short-term job loss at the hands of automation, the vacuum will ultimately fill in over time. The notion echoes the historical precedent of things like the agriculture example. And there is probably something to the notion in some cases that increased productivity and margins provide companies with funds that allow them to expand their size and employment ranks.

“There are a lot of middle-income companies that, rather than getting rid of people when they get robots, they realize people are of value, especially if they’ve been working for them for a long time,” says Doyle. “There’s always some concern when people bring in a robot. But I think once they realize that it’s there as a tool to help their companies, they really embrace it. Some of these companies… even name the robot.”

“It’s a rosy picture, but there’s a clear caveat. As the market shifts, even the most labor-friendly companies won’t be able to find new roles for the entirety of their workforce. Doyle describes different new roles that are being opened up in factories alongside robots, but the majority seem to require, if not an engineering degree, some sort of technical skill.”

Image result for photos of german auto manufacturing plants in the USA“The labor market for college-educated workers is very, very strong,” says Autor. “And those people continue to get paid better. The set available to people who just have a college education or less has dramatically contracted as a function as well as trade, but automation has been the bigger fact. It’s an important part of the growth of inequality we’ve seen over the past several years, the decline of earnings and fortunes of people without a college degree.”

“It’s a deepening divide that speaks to the ever-growing need for STEM-based education that goes well beyond higher education. Common wisdom holds that the addition of productivity and the lowering of costs will open the possibility of more employment. And indeed, as factories become automated and more robots are introduced into the process, new, unforeseen categories will open up in the workforce.”

“But unlike some of the more entry-level manufacturing positions, companies do often have a problem filling roles that require a college education, or at the very least, specialization. As the nature of manufacturing jobs shift, so too will the divide.”

Image result for photos of robotic and automated systems in manufacturing companies“While as Doyle suggests, it’s in the best interest of companies to reward loyalty among employees, how many corporations will ultimately take on the financial burden of educating a changing workforce?”

“And even then, how much of a dent can such education really make? Larry Summers is skeptical. The  National Economic Council Director turned Harvard professor who penned the bluntly titled piece “Robots are hurting middle class workers” tells TechCrunch, “I’m sure more and better STEM education would be good but doubt it is the panacea some suppose. If STEM were in genetically short supply two-thirds of engineers would not be working outside engineering and there would be more acute wage pressure across the board.”

8 comments

    • Dear Roger,

      I have a certain number of people in my circle. One is my favorite doctor who is always very kind and helpful to me. She voted for DDT and she is still defending him. I can still hear her saying, why don’t people give him a chance. He is trying but people are being so hateful, etc.

      It is like we non Trump universe of voters live on planet Mars, and those who voted for him live on planet Venus. We don’t speak the same language.

      Ciao, Gronda.

  1. Very good post, Gronda. This is an important topic and one we don’t hear much about. Another thing that is ususally not included in such discussions is the fallacy that the good jobs….such as the steel mill and manufacturing jobs in the northern states … went from Ohio for instance…just suddenly moved to Mexico. They FIRST moved to southern states like Alabama, where the companies did not have to bother with the pesky labor unions. From there to Mexico was easy to do once they busted the unions. NAFTA did terrible damage to Mexican workers in agriculture and “maquiladora” (sweat shops) when the US dumped corn and piece-work jobs.

    • Dear Gradmama2011,

      You are so right in your analysis.

      The fact is, these manufacturing jobs are gone. As robotics and automated systems take ober the manufacturing jobs, it may become more economical to return these factories back to the USA, as the need for more technically competent workers increases. But the educational support for these type of personnel needs to be increased and made more available.

      Thanks a million times over for your support and for this reblog.

      Hugs, Gronda

      • Thanks for letting me reeblog! This business about bringing back high-paying jobs that Trump keeps repeating is cruel and heartless. The great factory jobs that required hard work and not necessarily education beyond “the job” is in the past. Perhaps a new generation of Luddites is rising to smash the robots that are taking over the machine workers.

  2. Gronda, this is well done. Manufacturing productivity has actually increased in the US since the early 1980s, but the number of workers has declined due to technology improvements. This will continue and for Mnuchin to say it is not on their radar is the height of irresponsibility. And, you are dead on accurate that our President is not considering the huge benefits of global trade with the number of foreign employers making cars and other things with American workers (including BMW, Mercedes, Nissan, Volvo, Toyota to name a few). Well done. Keith

    • Dear Keith,

      You are so right in your analysis.

      Mr. Mnuchin’s attitude tells me how the president is not serious about really helping the average Joe laborer get those better paying jobs. How can any executive address a problem if he doesn’t admit to its existence?

      Trade agreements are necessary to increase jobs but these agreements need to factor in doing better in making sure the average Joe .gets some of the benefits

      Ciao, Gronda

Comment

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s