Manufacturing’s share of U.S. employment has been on a steady decline since the end of World War II. In May, the figure touched 8.48 percent, the lowest level since the Labor Department first began keeping records in 1940. The decline has been linked to the growth in income inequality, the weakening of the American middle class, and the rise of populist politics. But as the country appears to rethink free trade and automation appears to be finishing what trade agreements like NAFTA began, U.S. manufacturing still has some things working to its advantage.
Lisa Cook, a professor of economics at Michigan State University who worked on President Obama’s transition team, said it “was industrial production that was getting us out of the recession. So we were watching that very closely.”
Manufacturing, which represents 12 percent of GDP, is the “essence of … high-value exports from this country,” Cook said at a Thursday session at at the Aspen Ideas Festival, which is cohosted by The Aspen Institute and The Atlantic. And while manufacturing’s share of the U.S. economy has declined, it still draws more than a third of foreign direct investment in the country, and foreign companies still employ nearly 1 in 5 people in manufacturing jobs . “This represents good jobs in America,” Cook said, adding “This is where family wealth came from in America.”