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The Decline of US Manufacturing: Issues of Measurement

Challenges associated with the measurement of complex phenomena pervade social science research. That said, some phenomena seem as though they should be reasonably straightforward to measure, especially given the availability of apparently reliable, government-provided data. The state of the US manufacturing sector would seem to fall into this category. The US Bureau of Labor Statistics (BLS), which has a mandate to provide ‘gold-standard data’ that are ‘accurate, objective, relevant, timely, and accessible’ (www.bls.gov), provides extensive data that can be used to gain insights into various aspects of US economic activity. Data are readily available, for example, to facilitate delving into historical issues of productivity and employment in the US manufacturing sector. As shown in Figure 1 of Contractor (2021, in this issue), prior to the current pandemic, US manufacturing output was nearly as high as it has ever been. On the other hand, Figure 2 of the same commentary tells a different story about employment. In December 2019, employment in the US manufacturing sector was estimated at 12,866,000; this is approximately the same level as December 1941 (12,876,000), when the US population was about 40% of its current size. There has been a precipitous drop since the start of the 21 century. The loss of approximately 4.4 million manufacturing jobs (17,284,000 in January 2000 to 12,866,000 in December 2019) represents more people than the population of any US city other than New York; a further 613,000 manufacturing jobs had also been lost as of November 2020. These job losses have affected a wide swathe of industries, in contrast to the more industry-specific (e.g., steel, automotive assembly) job losses of the 1980s, and have occurred simultaneously with an increase in the workingage population in the US (unlike, e.g., Japan, where lower manufacturing-sector employment has been coincident with a shrinking labor force). This fall in manufacturing-sector employment is fully consistent with the US economy’s well-documented shift toward services. However, it has substantial implications for the standard of living, especially for lower-skilled employees. For Management and Organization Review 17:1, February 2021, 24–28 doi: 10.1017/mor.2020.82