Robots Create Made in the USA Jobs

Robots Create Made in the USA Jobs By Joel D. Joseph, Chairman, Made in the USA Foundation

In the long run, many economists think that automation and robotics are going to replace a significant percentage, if not the majority, of manufacturing jobs. However, most of those job losses will be in low-wage countries where unskilled workers are doing routine, mind-numbing jobs. Despite an increase in robots on the assembly line, the United States has added more than 25,000 manufacturing jobs during 2016.

In April, 12.4 million Americans worked in manufacturing, according to the U.S. Bureau of Labor Statistics. That's up by 27,000 jobs from a year prior, and almost a million from early 2010. One reason for the increase in American jobs: Last year, for the first time in decades, more manufacturing jobs came back to the United States than left. In 2016, there was a net gain of 27,000 jobs. That reflects a loss of about 50,000 jobs that left the country, combined with a gain of 77,000 jobs that returned to the U.S. or are a result of foreign companies investing in U.S. factories. Where Do These Jobs Come From? The bulk of these new jobs -- about 60 percent from 2010 through 2016 -- came from China. Labor has become more expensive in China, with Chinese wages going up 12 percent to 15 percent a year for the past 15 years. Thousands of jobs have also come back from Mexico and South Korea as well. In the first quarter of 2017, U.S. companies bought 32 percent more robots than the same period last year, according to data from the Robotic Industries Association. The reason for the increase? Robots have become cheaper. Adidas announced that it is opening a new factory in Georgia that will be highly robotized, with about 160 human workers. Adidas is a German company that never manufactured shoes in the United States before. Marlin Steel, for example, in Baltimore was able to stay in business by automating its production to stay competitive when many other manufacturing jobs went overseas. Robots make manufacturing in the United States more efficient and thus more competitive. Concerns about Automation Aren't New Workers have been worrying about automation wiping out jobs for centuries. The Luddites were a group of English textile workers and weavers in the 19th century who destroyed weaving machinery as a form of protest. Ninety-eight percent of the work of a weaver became automated. and understandably, the workers rebelled. However, over a period of years the number of textile workers actually grew.

At the beginning of the 19th century, it was so expensive to make apparel that a typical person had one outfit of clothing. As costs started dropping because of automation, people started buying more and more, so that by the 1920s the average person was consuming ten times as much cloth per capita per year. More demand for cloth meant a greater need for textile workers.
In 1900, 41% of American workers were employed in agriculture, but by 2000, automated machinery, such as tractors and harvesting equipment, brought that down to just 2%, MIT professor David Autor wrote in the Journal of Economic Perspectives in 2015. Farmers moved to cities and took other jobs while food became less expensive.

The arrival of the automobile ushered out horses, reducing the need for blacksmiths and stable hands, but the auto industry created many more jobs than the horse-drawn economy lost.
In the 21st century, computers are performing tasks humans once did, making workers more productive. When ATMs were introduced in the 1970s, people thought they would be the death knell for bank tellers. The number of tellers per bank did fall, but because ATMs reduced the cost of operating a bank branch, more branches opened, which in turn hired more tellers. U.S. bank teller employment rose by 50,000 from 1980 to 2010.
The Future of American Jobs Are we headed for a 15-hour work-week? That's what noted economist John Maynard Keynes predicted in his famous 1930 essay Economic Possibilities for Our Grandchildren. He said that in the next century technology would make us so productive we wouldn't know what to do with all our leisure time. It hasn't quite worked out that way yet, but we do have shorter hours now than 80 years ago. As a nation, we should strive for a shorter work-week. Americans work longer hours than workers in Europe where a 35-hour work-week is the norm. Europeans also enjoy six weeks of vacation, while Americans have two weeks off per year.

Robots may cause a loss of jobs in Asia by replacing workers who do routine, monotonous work. But in wealthy countries, like the United States, robots will create jobs and increase efficiency, much like farm equipment liberated farmers and farm children to do other things.