All errors should be reported to

Wednesday, March 08, 2017

Peak Manufacturing, eh?

I was assured there would be no manufacturing jobs.

From 538, the gold standard for media predictions, on March 18, 2016:
Manufacturing Jobs Are Never Coming Back

The story said:
How do we know? Because in recent years, factories have been coming back, but the jobs haven’t. Because of rising wages in China, the need for shorter supply chains and other factors, a small but growing group of companies are shifting production back to the U.S. But the factories they build here are heavily automated, employing a small fraction of the workers they would have a generation ago.
From USA Today, four days before the election:
Why Donald Trump will fail to bring back factory jobs
From MIT Technology Review, ten days after the election:
Manufacturing Jobs Aren’t Coming Back
President-elect Trump’s promise to bring back production jobs ignores the realities of advanced manufacturing.
From Nobel-winning economist Paul Krugman on November 25:
The story of U.S. manufacturing is basically one of high productivity growth allowing demand to be met with ever fewer workers,
From CNBC on December 1:
Trump's Carrier deal aside, here's why most US factory jobs aren't coming back
From the Economist on January 14:
Politicians cannot bring back old-fashioned factory jobs

I get it.

Factory jobs are dead.

We had reached Peak Manufacturing.

So why have Ford, Fiat-Chrysler, GM, Toyota and other car manufacturers announced billion-dollar investments in the United States and plans to hire thousands of workers? Why did Exxon just announce a $20 billion plan to expand its factories in the United States?

And why this from the Wall Street Journal:
SEOUL— Samsung Electronics Co. is planning a major investment to expand its U.S. production facilities, according to people familiar with the matter, with at least five states in discussions.
The initial capital investment is expected to be around $300 million, several of the people said, with Samsung shifting some production of oven ranges to the U.S. from Mexico. The move could generate around 500 jobs, those people said.
Talks are continuing and no final decisions have been made, with a start date for oven-range production still undetermined, the people said, so the details may change.
Could it be that the same mouth-breathing imbeciles who missed Trump's nomination and Trump's election also don't know jack about economics?

Especially that Nobel Laureate in Economics, Krugman.

"Trump the Establishment" is now on Kindle!

"Trump the Establishment" is also available in paperback.

This is the sequel to "Trump the Press," which covered the nomination. The original -- "Trump the Press" -- is available on Kindle, or in paperback on Create Space.

Autographed copies are available by writing me at

Please follow me on Twitter.

Friend me on Facebook.


  1. There there, Don, you'll be okay ;~)

  2. They don't know jack (or everything) about economics. Krugman's nobel prize was for "new trade theory" and "new economic geography" involving international trade. Not sure about the specifics and I don't care. But he is not an exert on all phases of economics. I would not want a dermatologist to do heart surgery or fill a cavity.

    I posted this before, but read "I, Pencil" by Leonard Read to see the economics of making (manufacturing) a simple item. Apply this to mining, refineries, automated factories, etc.

    This is yuuuuuuge news.

  3. Talk about tired arguments. The CEOs of the aforementioned car companies all said the expansion plans were well underway before Election Day.
    Exxon began its expansions in 2013 ... all you had to do was read the WH press release which was plagiarized from the Exxon press release.
    I hope manufacturing jobs come back. Really do. I'm sure the 3,000 workers who were laid off from a GM factory in Ohio on January 20, 2017 do too.

    1. You missed the point.

    2. Manufacturers in Mexico are getting nervous because of the narco-government and rampant crime. Low wages are great for profits as are no pollution or worker safety standards. But the imploding social and legal systems in Mexico make it increasingly a bad bet to be operating in an unstable Mexico.

    3. Thanks for this insight. US law is the biggest advantage we offer to he business world. This why the Obama sloughing of it is so damaging.

    4. @Elliott: I truly hope Mexico can straighten out its social and economic problems so they don't spill over into the US. What would it take for Mexico to go the route of Venezuela from capitalist riches to socialist rags? If I were the owner or the prospective owner of a large business investment in Mexico, looking at the country's long-term prospects, I'd worry about the possible rise of a demagogue leader who could advocate the nationalization (i.e., confiscation) of all foreign investments.

  4. Very few people who claim prdicitve ability in economics are successful themselves using their own claimed powers, otherwise they would never divulge they had them. However by selling their predictions to others of amateur status as coming from an "expert" they often get rich even if they are wrong. They always have another profitable agenda they do not disclose to make them immune from failure. In Krugman's case his readers not only consider him a god but they very much want Trump to be called a fool. K is well paid weekly for exercising these reassuring duties, so predictions that don't pan out are unimportant to his bottom line. Sooner or later there will be a dip in the market or some other untoward event for which Trump can be (unjustly) blamed, etc, which he will point out to his faithful as proof he really is Cassandra, just temporally in drag. I was especially impressed by his deft ice pick to Obama's spleen when the "stimulus" failed, saying He had made clear to his readers before that a measly Trillion wasn't enough, rather 3 was needed, an impossibility high figure he knew was politically and practically impossible.
    There is no one in the press who deserves less respect than Nobelist Krugman.

    1. Has Krugman ever been right about anything of consequence?

    2. That's Paullie "The Beard" Krugman, and likely he has been right once, but...out of sequence (too early, too late).

    3. Anon: "Right?"

      Yes: The aliens angle.
      Seems he's in the Podesta/Clinton camp.

  5. Looks, from those headlines, that Journolist is back and up to its old tricks!

  6. I have come to the (regretful) conclusion that Liberals don't want to see more jobs...

    Me: So who's going to pay when everyone is on welfare?
    Lib: The government.
    Me: And who is the government funded by?
    Lib: The government.
    Me: Are you serious?!?!
    Lib: The government.

  7. All you need to know about Krugman is that he was an economist for ENRON. 'Nuff said.

    Remember on election night he said the market would never recover. How's that prediction working out?

  8. And, ADP got jacked for almost 300K this morning; 100K over the...wait for it...wait...


  9. "I get it. ... Factory jobs are dead."

    I don't think you do get it. Above you quote:

    "How do we know? Because in recent years, factories have been coming back, but the jobs haven’t. Because of rising wages in China, the need for shorter supply chains and other factors, a small but growing group of companies are shifting production back to the U.S. But the factories they build here are heavily automated, employing a small fraction of the workers they would have a generation ago."

    Here's the key bit:

    "the factories they build here are heavily automated, employing a small fraction of the workers they would have a generation ago"

    I don't see why that is so hard to understand.

  10. You just watch. When the "Peak Manufacturing" line is proved wrong, the MSM will turn on a dime, give you nine cents change, and try the opposite line.

    That it's some sort of Fritz Lang "Metropolis" hell in those manufacturing places.

  11. From January 2013:
    "A growing number of American companies are moving their manufacturing back to the United States. ... Jan 19th 2013" This is due to three trends, lower energy prices in the US due to fracking, higher wages overseas, and the use of automation in the US which reduces labor costs.

    1. The trend of industrial automation is global. It will be as true of China as of the US. As the labor cost advantage of China or Vietnam or India vanishes, there will be no compelling reason for many industries to export production facilities off-shore. The hand-writing is on the wall: it's time for companies to think about bringing their production facilities back home.

      What such widespread factory automation means for labor and general employment is another matter, with potentially serious social implications. It could become the next big civil rights issue across the entire globe, for both developed as well as developing countries.

      The rapid, disruptive technology of automation will have social costs. Not too many politicians in Washington are willing to face the issue before it becomes a yuuuuuge problem. They keep looking backward, not forward.

  12. The February jobs report also was 100,000 higher than estimates with a preponderance of "non-service sector jobs". That's a fancy name for manufacturing jobs. The Trump policies haven't even had enough time to tase effect - manufacturers are betting on the future.

  13. Everything Paul Krugman says is Good, and Right, and True, and if tomorrow he says the exact opposite, it will also be Good, and Right, and True, and moreover will always have been Good, and Right, and True.

  14. Unbiased LSM will never return.

  15. Interesting is that Samsung is one of the major reasons why manufacturing jobs have decreased - the company is a major player in robot design and development.

    Repeat after me: Peak manufacturing job numbers occurred in 1943 - and it has been downhill ever since.

    1. Totally false
      Manufacturing was 16 million then, rose and hit 19 million throughout the 1970s. At 17 million when NAFTA passed. Now at 1940 mark of 12 million

    2. I wish Gadfly would quit demonstrating his idiocy so much! It's kinda embarrassin'...

  16. Wages need to increase, but that won't happen with excess labor. Not only immigrant or illegal alien labor, but the excess labor represented by wives who need (or believe to need) to work for wages outside the home because it seems no primary wage earner can make enough to support a family.

    One woman I worked with was commenting about how much her day care cost. I asked how much she was actually clearing after her wages, plus her husband's, minus the expenses of child care, second car, business attire (we worked in an office), increased taxes on those wages, increased property/ad valorem taxes on the cars, and so forth.

    We came to the conclusion that her greatest benefit was not the extra money (which was lost to extra expenses) but the mental sanity of having other adults to be around.

  17. I tells ya, there's gunna be lotsa work for automation engineers and robot installers.

    1. ...and designers, electricians,plumbers,transport companies.When people have jobs they buy stuff. Not all stuff is from automated factories. There are technological advances being created that will revolutionize the whole world. Made in U S A will employ millions. Have faith my son...