As US loses manufacturing jobs, industry profits rise

By Gretchen Brown, for Wisconsin Public Radio

Jul 21, 2017

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Earlier this week, Milwaukee-based Harley-Davidson announced layoffs at its production plants in Menomonee Falls and Kansas City. In total, 180 jobs are slated to be cut just months after Harley-Davidson revealed plans for a new plant in Thailand.

To some in Wisconsin, the developments were worrying. Milwaukee lost nearly 4,000 manufacturing jobs from 2015 to 2016.

But some economists say that job loss doesn’t mean the American manufacturing industry is tanking. On the contrary. In fact, 2015 was a record year for manufacturing in inflation-adjusted dollars, said Michael Hicks, an economist at Ball State University, even as the U.S. employs millions fewer manufacturing workers.

"At the end of the 1700s, most Americans were employed in agriculture. That has, of course, gone down to about 2 percent, but now, we make enough food to feed the whole world," said Diana Furchtgott-Roth, former chief economist of the U.S. Department of Labor and senior fellow at the Manhattan Institute for Policy Research. "Because our manufacturing has gotten more capital-intensive, and we’re increasing our productivity in that sector, it’s doing very very well.

"We can’t just judge a sector by the amount of people employed in it."

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