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March 25, 2010

Don't write off manufacturing

A recent TV show about the condition of manufacturing in the United States today implied that because we have lost many manufacturing jobs we are no longer a manufacturing country. But is that right?

Dr. Mike Walden, North Carolina Cooperative Extension economist in the College of Agriculture and Life Sciences at N.C. State University, responds:

"That is just plain wrong. If you look at the amount, the amount of manufacturing output that our country does, that is what is produced out of the factory gates each year, we are producing more out of our factories today than we were 50 years ago. In fact, we are producing more than we were 10 or 15 years ago -- that is, manufacturing output except during recessions in our country tends to go up.

"So how can it be, however, that we are producing all this additional manufacturing output but with fewer people? Well it's because you have to recognize that to make something labor is one component. Another component would be machinery. Another, a third component would be technology. And what has been happening in our country, and indeed it has actually been happening around the world, is that manufacturers have been shifting away from using people to manufacture things to using more equipment and more technology.

"So what has resulted is a situation very akin to agriculture, where we produce much much more -- many many more agricultural products -- today with a tiny, tiny fraction of the people that were used 70 years ago. That's where manufacturing is headed."

Posted by deeshore at March 25, 2010 08:00 AM