Obama overstates value of manufacturing

Published: Wednesday, Feb. 13 2013 10:25 a.m. MST

President Barack Obama gestures as he gives his State of the Union address during a joint session of Congress on Capitol Hill in Washington, Tuesday night.

Charles Dharapak, AP

Enlarge photo»

Contrary to President Barak Obama’s statements in his State of the Union speach Tuesday night, manufacturing jobs won’t help America as much as he projected, according to an article in the Atlantic.

One reason is that bringing manufacturing back to America won’t translate into a huge increase in jobs. Manufacturing relies heavily on technology and greater use of robots and automation — processes that don’t require much human involvement.

Likewise, the pay for manufacturing jobs isn’t high. In the United States the average yearly salary is $34,220 according the Bureau of Labor Statistics. That’s not much more than the $30,597 those in low skill service areas like food preparation, clerical work and retail sales earn.

However, U.S. counties with high concentrations of manufacturing activity experience low rates of economic growth, according to a study by the Federal Reserve Bank of Cleveland.

“Since 2000, this set of high-manufacturing-share counties has usually experienced lower employment growth than the rest of the counties in the United States,” according to the study. “This was particularly true during the recent recession, when employment losses reached almost 6 percent per year in these counties compared to a peak employment loss of only 3.7 percent per year in the rest of the country.”

EMAIL: alovell@deseretnews.com

Get The Deseret News Everywhere

Subscribe

Mobile

RSS