Manufacturing jobs are shrinking everywhere

The decline in manufacturing jobs isn’t confined to the (now) rich world.  According to the Groningen Growth and Development Center, manufacturing jobs in Brazil climbed as a proportion of total employment from 12 percent in 1950 to 16 percent in 1986. Since then it’s slid to around 13 percent. In India, manufacturing accounted for 10 percent of employment in 1960, rising to 13 percent in 2002 before the level began to fall. China’s manufacturing employment share peaked at around 15 percent in the mid-1990s and has generally remained below that level since, estimates Harvard economist Dani Rodrik. As a proportion of output, manufacturing accounted for 40 percent of Chinese GDP in 1980 compared with 32 percent now. 

As Rodrik has pointed out, most of today’s rich countries “became what they are by traveling the well-worn path of industrialization.” Agricultural workers moved to factories, followed by a period when manufacturing ceded its dominance to services. Because of the declining demand for labor in manufacturing, however, the traditional path from peasant through factory worker to cubicle farmer is missing its middle step. That’s particularly bad news, suggests Rodrik, because, unlike labor productivity in general, productivity in manufacturing is converging across countries—it’s rising faster in countries that start with the lowest productivity. And the global decline of manufacturing could have political effects: Manufacturing unions were an important part of the organization of labor parties worldwide.

via Why Factory Jobs Are Shrinking Everywhere – Businessweek.

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