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Old 04-18-2017, 04:26 PM
 
Location: Kansas City, MISSOURI
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Is U.S. Manufacturing Really Declining?
Quote:
[...]

However, these numbers exaggerate manufacturing's decline. To see why, we need to measure the manufacturing sector's share of real GDP.

The total value of goods produced is equal to the price multiplied by the quantity of goods produced. Removing the price effects from nominal GDP gives us real GDP, so changes in real GDP are the result of changes in the quantity produced. Thus, we can measure how the manufacturing sector’s output has changed over time.

Manufacturing's share of real GDP has been fairly constant since the 1940s, ranging from 11.3 percent to 13.6 percent. It sat at 11.7 percent in 2015.

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Old 04-19-2017, 07:17 AM
 
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Automation has impacted productivity over time to hold GDP share while shedding line jobs.
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Old 04-19-2017, 07:41 AM
 
Location: East of Seattle since 1992, originally from SF Bay Area
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Quote:
Originally Posted by SWFL_Native View Post
Automation has impacted productivity over time to hold GDP share while shedding line jobs.
True, but also, if you look at the increase in population (consumers buying goods) the fairly flat U.S. manufacturing would be a sharp increase over that time if not for imports.



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Old 04-20-2017, 12:49 PM
 
Location: Ruidoso, NM
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Quote:
Originally Posted by James Bond 007 View Post
Silly article.

Why use % "real GDP" vs % GDP? The later is what tells us how significant manufacturing is to our economy.

And for every developed country, manufacturing has been declining in importance for a long time. That's a good thing. As Hemlock140 pointed out, the issue with US manufacturing is that we import a lot more manufactured goods than we export.

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Old 04-20-2017, 01:42 PM
 
Location: The Triad (NC)
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What all of this glosses over though is how the nature of what manufacturing means has changed.
Most of that change is in the declining number of man hours per ton of output.

Most of that decline is in the steady erosion of most of the no and low skill labor jobs related.
Most of that erosion will continue until these no and low skill labor jobs are eliminated almost entirely.
---

But do you know what numbers aren't being eroded?
The number of people being produced who are suited to those no and low skilled jobs.
This is a problem. It could become a crisis. Some would say it's already a crisis.
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Old 04-21-2017, 02:52 PM
 
Location: NH/UT/WA
283 posts, read 169,742 times
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Quote:
Originally Posted by rruff View Post
Silly article.

Why use % "real GDP" vs % GDP? The later is what tells us how significant manufacturing is to our economy.

And for every developed country, manufacturing has been declining in importance for a long time. That's a good thing. As Hemlock140 pointed out, the issue with US manufacturing is that we import a lot more manufactured goods than we export.

Yep.

Manufacturing generally peaks as a percentage of GDP when countries hit the ~$15,000 GDP/head mark (in todays PPP dollars). The US hit that in the 40/50s, Western Europe in the 60s, Japan in the early 70s, and China is hitting it right now. India will probably get to it in the 2030s. The old communist countries hit that mark in the 80s, then collapsed, because a top-down system fails miserably when it comes to a service economy.
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Old 04-21-2017, 05:22 PM
 
Location: Kansas City, MISSOURI
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Quote:
Originally Posted by rruff View Post
Silly article.

Why use % "real GDP" vs % GDP? The later is what tells us how significant manufacturing is to our economy.
The article explains why. There are price trend differences between the manufacturing vs non-manufacturing sectors over the past several decades. When you take that into account the % of the economy (GDP) dedicated to manufacturing hasn't really changed much for decades.
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Old 04-21-2017, 05:39 PM
 
Location: Ruidoso, NM
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Quote:
Originally Posted by James Bond 007 View Post
The article explains why. There are price trend differences between the manufacturing vs non-manufacturing sectors over the past several decades. When you take that into account the % of the economy (GDP) dedicated to manufacturing hasn't really changed much for decades.
Unless I misunderstand what "real % GDP" means (very possible), all they've effectively done is apply a correction that shows our quantity of manufactured product has been stable. % GDP without the CPI correction shows the % of our economy dedicated to manufacturing.

If makes sense that our quantity of manufactured product would not have declined. We've lost some to trade, but also increased our consumption of manufactured goods over time.

How exactly does a person calculate a "real % GDP"?
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Old 04-21-2017, 06:11 PM
 
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R=N/D

The '%' would refer to the manufacturing component percentage of real GDP.
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Old 04-21-2017, 06:38 PM
 
Location: Ruidoso, NM
5,170 posts, read 4,733,092 times
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Quote:
Originally Posted by damba View Post
R=N/D The '%' would refer to the manufacturing component percentage of real GDP.
"Real" typically corrects for CPI over time. The same time correction would be applied to both total GDP and manufacturing. So I still don't understand what "real % GDP" is supposed to mean.
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