Plan Will Create 6.9 to 12.9 Million New Jobs by 2024
COVID-19 shocked the U.S. economy and made clear that the U.S. needs to ramp up production of critical goods. Here’s how we make things better.
It’s an entirely predictable sequence: Every four years, national political figures will find their way to industrial battleground states such as Michigan, Ohio, Pennsylvania, and Wisconsin, and proceed to extol the virtues of factory jobs. Some economists and idealogues (sic) will then dismiss the political rhetoric as nostalgic and unrealistic pandering.
I welcome the attention this issue receives and am happy to joust with the skeptics, because I know just how important manufacturing is to the health of our nation. And if the United States enacts a bold industrial policy to strengthen this critical sector, every single state will see millions of new manufacturing jobs.
To find out just how many, we asked our partners at the Economic Policy Institute to estimate the job impacts of some specific policies that we have consistently called for over the past dozen years: Investing in infrastructure, positioning America as a clean energy manufacturing leader, and taking steps to slash our manufacturing trade deficit through competitiveness measures, trade enforcement, better trade agreements, and a careful shift in the value of the dollar.
The results are stunning. As a nation, we stand to gain 6.9 to 12.9 million jobs by 2024, including 2.5 million in manufacturing alone.
Every state and the District of Columbia would see jobs gains, with key industrial states making the top 10 as a share of total state employment, including Wisconsin (6.16%, 181,000 new jobs); Indiana (5.95%, 185,900); Iowa (5.91%, 94,500 jobs); Michigan (5.55%, 251,200 jobs); and Ohio (5.51%, 302,400 jobs).
Such a plan couldn’t come at a better time. There is a growing consensus that our dependence on China and other nations for critical goods is dangerous. Thanks to decades of offshoring, Healthcare professionals, first responders, and other essential workers are still facing shortages of personal protective equipment like N-95 respirator masks; there are lingering questions as to whether the United States can effectively ramp up production to successfully deploy a potential COVID vaccine.
Some of this critical production must return to the United States. But it’s also become abundantly clear that growth built on stock market gains, app development, and gig jobs widens inequality, hollows out the middle class, and forces many American families into poverty and bankruptcy. Manufacturing jobs can bolster the middle class and reduce these inequities, as they tend to pay better than other private sector jobs that don’t require a four-year college degree and come with better benefits.
Investments in infrastructure are long overdue. Our roads, bridges, electric grid, water systems, schools, ports, and even broadband are no longer world class. In fact, their neglect is eroding our competitiveness and quality of life.
While most industrial nations have plans to diversify their energy portfolio, America has lagged behind. With a bold “Made in America” energy plan, we can jumpstart production of solar, wind, energy storage, electric vehicles, and other renewable sources in a way that boosts factory jobs rather than depending on China and other countries for importing these products.
The rise of China as an economic power, coupled with domestic policies that have weakened manufacturing, has come at the expense of American exports and jobs. We are no longer the world’s leading manufacturer or exporter. Despite calls from President Trump to address the trade deficit, it is at record levels.
The reasons are simple: America’s tax code and Wall Street investors reward offshoring. The value of the dollar has risen over the past six years, and much of the past several decades, making imports cheaper and U.S. exports less competitive. Our trade agreements still enable shifts of production abroad, and we have neglected the manufacturing ecosystem here at home.
As other industrial democracies have shown, it is entirely possible to have good wages and growing exports with the right policies. We have chosen another path, and it has come at the expense of millions of good jobs.
The good news is this: A growing number of national leaders understand the importance of a bold industrial policy. Getting that policy right is now the biggest hurdle. We have repeatedly tried a policy focused on tax cuts and deregulation. Unfortunately, those efforts have mostly backfired, coinciding with steep drops in manufacturing employment.
The alternative—substantial investments in America, and a dramatic shift in trade policy—is not radical. In fact, the idea originated with the first presidential administration of George Washington. His Treasury Secretary Alexander Hamilton wrote a report to Congress on the status of manufacturing, an argument for growing it in America, and a path to getting there. That path included “internal” investments in infrastructure and a trade policy that allowed our infant industries to grow, without shutting us off from the rest of the world.
As for the naysayers, those who worry about robots, automation, or philosophy, there is abundant evidence to refute their claims. We grew manufacturing jobs from 2010-2018, and to my knowledge, the robots didn’t take eight years off. While many economic competitors extol the virtues of free markets and trade, none of them want to sacrifice their manufacturing in the process, emulating the original American, Hamiltonian goal.
It will take careful nurturing to re-establish a new American manufacturing ecosystem. But its foundation will be built on policies that allow it to flourish. Through infrastructure investment, clean energy manufacturing leadership, and trade rebalancing, we can create more jobs and a more equitable, sustainable future for our middle class.
For interactive data and the original post click here.