There’s no denying that hiring in manufacturing has picked up since the election.
Trump is already taking a victory lap for bringing back the muscle jobs. The U.S. added 26,000 factory jobs in February and 11,000 in March. It’s a contrast to the Obama years when most of the job gains came in the service sector — tech, retail, business, health, etc. — not in manufacturing.
U.S. manufacturers are giddy “like never before,” Trump proclaimed at a recent White House event with CEOs. He’s been preaching the mantra: “Buy American, and Hire American.”
But it’s worth remembering that employment in manufacturing is currently at 1940s levels.
The glory days of manufacturing were the 1970s. Back then, over 19.5 million Americans earned their paycheck from factory work. It’s been a fairly steady decline ever since. Today only 12.4 million workers remain in the industry.
Manufacturing output is back, but the jobs aren’t
The reality is some of the jobs once done by human hands are now done by robots. It’s evident in the data: U.S. manufacturing output is at an all-time high, but manufacturing employment remains subdued.
Some point out that manufacturing employment has climbed a little since hitting a low of 11.5 million employees in 2009, but it’s not even back to pre-crisis job levels, let alone the glory days.
“We certainly saw a sizable jump in manufacturing hiring last month,” says economist Sam Bullard of Wells Fargo. “That said, I am not so sure we will be able to maintain this current pace over the course of the year.”
Still, the manufacturing industry is cheering on Trump. According to a recent survey by the National Association of Manufacturers, 93% of its 14,000 members have a positive outlook for U.S. manufacturing. It’s the highest level of optimism in 20 years.
Manufacturers like what they hear from the White House about tax reform and more infrastructure spending.
“How much job growth occurs will depend significantly on how taxes might change,” argues economist and forecaster Lynn Reaser of Point Loma university.
But overall, only 8% of U.S. workers are employed in manufacturing today, a big drop from 22% in 1970.