Manufacturing jobs are better jobs
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We're reading Fear, Bob Woodward's book on the Trump White House, and we're having trouble figuring out who the good guys are. Certainly Mr Trump grasps inadequately at solutions for the problems he sees. Detaining more families at the border, for example, will not produce higher wage growth. But particularly on the campaign trail, he had a gift — and we mean that word sincerely — for talking about problems, like wage growth, that both parties had failed to address.
In part, Fear reads like a string of advisers trying to convince the President that some of these problems don't exist. For example here's Gary Cohn, head of the President's National Economic Council and a likely source for the book, trying to convince his boss that manufacturing is in decline because people don't want those jobs (emphasis ours, and thanks to Chris Rugaber of the AP for flagging the passage):
Cohn tried to explain. “I can sit in a nice office with air conditioning and a desk, or stand on my feet for eight hours a day. Which would you do for the same pay?” Cohn added “People don't want to stand in front of a 2,000 degree blast furnace. People don't want to go into coal mines and get black lung. For the same dollars or equal dollars, they're going to choose something else.” Trump wasn't buying it. Several times Cohn just asked the president “Why do you have these views?” “I just do,” Trump replied. “I've had these views for 30 years.” “That doesn't mean they're right,” Cohn said.
It doesn't mean they're wrong, either. Donald Trump's tariffs don't seem likely to fix American manufacturing. But then neither do Gary Cohn's assertions that the market is working, and that people are choosing not to experience the discomfort of a manufacturing job. To start with: the pay isn't the same. The single largest group of Americans, 23.5 million, is employed in a group the Bureau of Labor Statistics calls “Trade, Transportation and Utilities” — selling stuff. Most of them, 13.6 milion, work in retail. Retail workers make about $16 an hour.
Manufacturing workers, though there are only about 9 million of them, make about $21.50 an hour. There are only 550 thousand mining and logging workers, but they make more than $28 an hour. They aren't the highest-paying jobs in America, but for someone without a college degree, a manufacturing job in front of a blast furnace pays far better than an air-conditioned job inside a Target.
People in finance are famously overworked, so we'll forgive Mr Cohn for not knowing that for many Americans, pay isn't the only consideration. Simply getting enough hours is a challenge. Here, standing in front of a blast furnace or risking black lung (as he puts it) both have a massive advantage: both occupations offer 40 or more hours a week.
Your weekly paycheck isn't your wage; it's your wage multiplied by your hours. Over the last 40 years, hours overall have drifted down, particularly in retail, where in the last decade scheduling software has allowed companies to more efficiently call employees in or dismiss them. But manufacturing jobs, which are more likely to be unionised, still offer 42 hours a week. Mining and logging, which tend to run closer to capacity, offer 47 hours.
And in America, whether an employer offers benefits can make a huge difference. Last year 81 percent of production jobs offered health insurance. Overall for private workers, 68 percent. For service jobs — the single largest group — 39 percent. So the job that Gary Cohn says Americans wouldn't choose at the same pay turns out to have better pay, better hours, and better benefits. People are nostalgic for manufacturing jobs not just because it's nice to make something. It's because they're better jobs.
Trump was on to something, during the campaign. People are dissatisfied with the quality of the jobs they hold. Perhaps they want manufacturing jobs. Perhaps they just want the kind of security that manufacturing jobs offer. Either way, it's hard to be sympathetic to the people in the administration who, confronted with the President's inchoate but not entirely incorrect feelings on economics, attempted to explain them away.