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Location: Pantego, Texas, United States

Friday, February 29, 2008

There is a lot of talk by politicians about "lost" manfacturing jobs. It is difficult to determine how extensive this job loss is, and what is responsible. Some of the loss is due to automation; more capital investment that improves production efficiency so that more output is achieved with fewer workers. There used to be a lot of planners and time-keepers on the factory floor that were classified as production workers who have been replaced by computers. Popular thought is that manufacturing jobs are "lost" to China. That may be true to some extent, but China has "lost" more manufacturing jobs over the past 10 years than there are in the United States. So, something else is happening, and it is automation. There is another subtle loss of manufacturing jobs to "outsourcing" that does not involve outsourcing to foreign countries. When I went to work for LTV 45 years ago, the custodians worked for LTV and were classified as having manufacturing jobs. After Loral bought LTV they outsourced the custodial work. Thus the custodians became "service" workers, even though they were doing the same thing the "manufacturing" workers they replaced had done. This sort of domestic outsourcing is widespread in industry.

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