Manufacturing jobs are defying expectations

“NATION LONGS for one more day with dying manufacturing sector.” This headline, published in 2014 by the satirical website the Onion, anticipated both President Donald Trump’s fears and the retorts he gets from his critics. Mr Trump campaigned on a promise to bring back jobs in manufacturing after decades of decline. To those who see the future of the American economy in services, these promises seemed backward. When he was head of the National Economic Council, Gary Cohn reportedly asked the president which he would prefer: sitting in nice air-conditioned office, or standing on his feet all day.

In 2018 it looks as though the president is winning the day. Industrial output is on a tear, and the last few months have seen the best run for growth in manufacturing jobs since the late 1990s. After spending about two decades on a steady march downwards, manufacturing’s share of the labour market appears to have all but stopped falling. Between 1948 and 2008, manufacturing employment fell as a share of private non-farm employment by around 0.4 percentage points each year (see chart). Since January 2010 it has fallen by only 0.3 points in total.