In the 1950s, around 35% of private-sector jobs in the U.S. were in manufacturing. Today, there are 12.8 million manufacturing jobs in the U.S., an amount equal to 9.4% of those private-sector jobs.
In the postwar years, more Americans joined the middle class, driving jumps in spending on long-lasting durable goods, like the cars and appliances for their newly purchased homes. America was America’s best customer for manufactured goods.
In the 1980s, things began to change. American manufacturers of nondurable goods had an increasingly difficult time competing with countries where labor costs were lower. That intensified in the 1990s, in part as a result of the North American Free Trade Agreement lowering duties on Mexican goods.
Susan Houseman, an economist at the W.E. Upjohn Institute for Employment Research. points out that manufacturing jobs generate other jobs in ways that others don’t. And she is part of a growing number of economists who argue that the U.S. should invest in making more of some things here, even though there are costs to doing that—but in a more targeted way than through the broad application of tariffs.
Increasing domestic production of high-tech goods such as semiconductors is an example, not just for the jobs that might create, she said, but for economic and military security reasons. That argument doesn’t hold for many low-cost goods.
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