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Benjamin Myers
Professor Kramer
CAS 137H
30 October 2013
The Death of the Industrial Giant
“The man who builds a factory builds a temple, that the man who works there worships
there, and to each is due, not scorn and blame, but reverence and praise” (Coolidge). In 1798, a
man by the name of Eli Whitney created one of America’s most influential inventions of all time,
interchangeable parts. The idea of producing standard parts with machines allowed products to
be assembled faster than ever. This concept eventually evolved into the Ford assembly line,
increasing the quantity and lowering the price of various factories goods (Kelly). Due to the
growth of industry, demand for workers skyrocketed. By 1950, thirty-four percent of America’s
workforce could be found on the factory floor, but everything changed in the 1970s
(Hagenbaugh). America’s industries began to close, and by 2009 manufacturing employment had
dropped below nine percent (Perry). Social, technological, and economical advances caused
American manufacturing to plummet, resulting in high unemployment in the manufacturing
sector, but a rise in service oriented jobs. The decline in industry can be seen by first observing
the history in America from eighteenth century to the twenty first century, then examining why
the shift occurred, followed by the results of the shift.
In the late 1700s and early 1800s, America took the first steps towards the industrial
revolution. In 1794, Eli Whitney created the revolutionary cotton gin, which extracted the fibers
from the cotton plant in record time. With the invention of the sewing machine, and the large
production of cotton in the South, textile mills began to prosper throughout New England
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(Kelly). Then in 1860, Samuel Morse created the telegraph, allowing for instant communication
across the nation. Also in 1869, the Transcontinental Railroad was completed, finally connecting
America’s East and West coasts (Kelly). Each of these components slowly brought America
closer to industrializing by training the population for factory work and increasing the means of
communication and distribution.
Because of the progress made in the early 1800s, America was able to enter the industrial
revolution, starting off with the Gilded Age. This was a time period that lasted from 1870 till
1900 and contains some of the greatest amount of progress throughout American history. One
contributing factor was the migration of people from the country to the cities. In fact, in 1860,
twenty percent of the population lived in rural areas but by 1900, that number had doubled to
forty percent ("The Gilded Age & the Progressive Era (1877–1917)"). The increase in urban
population gave business owners the workforce they needed to run their factories, thus allowing
industry to grow. In fact, America was prospering so significantly that according to the article
“Economy in the Gilded Age”, “America’s economy grew by more than 400% between 1860
and 1900.”
After the Gilded Age, America’s economy continued to flourish, at least until the Great
Depression. The 1930s saw high levels of unemployment and low levels of productivity. People
feared that America would never recover but things began to improve when the United States
entered World War II in 1941 (Katel). In order to fuel the war, factories had to produce
necessary military supplies like ammo, arms, vehicles, and medical equipment, thus restimulating the economy. Production was so impressive that from 1941 till 1945 the American
people were able to produce 127,766 planes and 5,777 transport ships (Katel). By the end of the
war, America’s economy had not only stabilized, it thrived. With all the other industrial nations
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in shambles as a result of the war, America had no competition in the global market. Because of
this, by 1963 the United States was producing 40% of the world’s goods (Katel). Neverless,
America’s good fortune soon came to an end.
In the 1970s, America began to see the decline in manufacturing jobs in the steel and
automotive industries in the states of Michigan, Illinois, Indiana, Ohio, and Pennsylvania. This
resulted in a massive migration of unemployed workers from the industrial cities to the southern
states and the once treasured region they left behind soon became known as the Rust Belt (“Rust
Belt”). Despite the great losses, America’s labor force actually peaked in 1979 at 19,553,000
workers, but it was all downhill from there (Perry). Through the 1980s and 1990s,
manufacturing continued to decline at a steady rate of 0.5% per year (Atkinson, Robert D.).
Citizens did express concern but this gradual slope was nothing compared to the plunge
manufacturing took in the twenty-first century.
Although the 80s and 90s had been concerning, it was not until the twenty-first century
when the American people started to panic. Job loss was at an all-time high. From 2001 till
2011, 5 million manufacturing jobs disappeared (Katel). In some respects, America was worse
off than during the Great Depression. According to Michele Nash-Hoff of the Huffington Post,
“During the Great Depression, we lost 30.9% of manufacturing jobs, but in the decade of 20002010, we lost 33.1% of manufacturing jobs.” Citizens were worried about the future of their
country and it is doubtful that America will ever reclaim its old title as the manufacturing
powerhouse of the world. This becomes evident when observing why the shift occurred in the
first place.
For one thing, less Americans are looking for jobs in manufacturing. This is partially due
to the spike in students attending to college. Americans use to go straight into the workforce after
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graduating high school. In 1950, only 6% of adults in America had a bachelor’s degree, but
between 2005 and 2009, the percentage increased to 27.5% ("Adults With College Degrees in
the United States, by County"). The reason for this drastic change is because of the gradual
increase in standard of living. Families now have the means to send kids to college and once one
generation makes, the rest will follow. Not only that but young Americans do not respect factory
workers like they use to. Today’s youth are looking for white collar jobs. They aspire to become
doctors, lawyers, or some other professional position. Assembly line jobs and other blue collared
jobs are not on the new generation’s radar. Unfortunately, it is because of these aspirations that
America’s manufacturing sector is suffering.
Furthermore, there are less manufacturing jobs today because of advances in technology.
As technology has progressed, workers have been replaced by cheaper, more efficient,
automated machines. In fact, in 1950 the output per worker was about $19,500 but because of
automation by 2010 the output for worker was $152,800 (Worstall). So even though there are
fewer worker today, the output is still greater thanks to new technology. This situation is often
compared to the transformation from an agricultural society to an industrial one. Similarly in the
1700s, 90% of people worked in agriculture but today only around 10% of the population are in
that field (Katel). Despite the loss of jobs, America’s production of crops is exponentially higher
than in the 1700s. Still, America is not considered an agricultural economy nor an industrial
economy because of the decline in jobs.
Finally, one of the biggest reasons for the fall of manufacturing is the increase in global
competition. As stated previously, after World War II, the United States had little to no economic
competition, but it did have political competition. The United States had entered the Cold War
and was competing with the Soviet Union to become the super power of the world. In order to
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prevent other nations from siding with the Soviet Union, the United States began to help rebuild
those that had suffered from World War II, such as Japan and most of Western Europe. Once
they were all back on their feet, these industrial nations could compete with the United States.
For example in 1979, the United States bought 13.1% of its cars from Japan, and by 2003, the
United States bought 32.5 % of its car from Asian Manufacturers (which included Japanese and
Korean companies) (Katel). This competition caused several American manufacturing plants to
fail throughout the 70’s, 80’s, and 90’s, but soon America would face another rising power,
China.
Out of all the nations, China has had the biggest effect on the American economy in the
past decade. China has over 983 million working age citizens along with less environmental and
safety regulations, a lower standard of living then America, and limited worker’s right. This
makes it the perfect place for United States companies to outsource jobs. In fact, China
artificially lowers its currency to maintain a cheap labor force (Katel). Regardless, China’s
economy is booming. In 2009 China exported $296 billion of goods to the United States, and by
2010, the amount had risen to $366 billion. To compare, the United States only exported $69.6 of
goods to China, most of these being raw materials, not manufactured goods (Katel). With all of
China’s advantages, it is nearly impossible for the United States to compete as dominant
industrial economy, and because of this, citizens of the United States have reacted.
One of the first things that occurred as a result of the shift is that people are adapting to
the changing economy by working in the new dominant field, service jobs. According to Peter
Zelinski, “In a service, the provider must do the job differently every single time, making
accommodations and intelligent judgments along the way, in order to respond to the distinct
differences in every customer and every request for work.” This is very different then the
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repetitive manufacturing jobs, and many Americans have jumped on the bandwagon. Service
jobs now make up 80% of the US economy (Katel). In comparison, in 1950, only 59% of jobs
were service jobs (Hagenbaugh). There are numerous reasons for this rise. For one thing,
business/customer relations have become more important over the past decades. Citizens are not
as influenced by commercials as they use to be, partially due to over exposure, so the remaining
businesses now have to provide more services to the customer (Gray). Also, technology has
created new means of providing services. With the massive distribution of smart phones and
laptops, people can now produce software that provides services, such as social networks,
streaming music, and providing information (Gray). With all these factors combined, the service
industry has become a huge success.
Now there are several members of the community against the shift. Many citizens have
lost jobs at companies they had been working at for years. After all, with 50,000 manufacturing
jobs being lost a month from 2001 till 2010, a reaction was bound to happen (Thompson).
American has always romanticism of the common laborer and the Union Worker, and many of
the employees truly loved their factory job. In addition, manufacturing workers earn 20% more
than the average service worker, so changing jobs would often result in a pay cut (Katel). The
common response has been Unions getting involved with politics, asking for government
intervention. This has also lead to several isolationist responses, such as petitioning trade
agreements because of the fear that they will lead to further outsourcing (Katel). Some of these
responses may seem radical, but it definitely shows that some Americans are hurting from the
shift.
The American people are losing manufacturing jobs but gaining service jobs because of
economic, social, and technological changes that resulted in the decline of manufacturing. Some
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believe that the service economy is the way of the future, while others want to return to
America’s glory days. But the change would never have occurred if it were not for the increase
in college students, new technologies, and global competition. Regardless of the change, no one
can doubt that America has had a rich history of manufacturing. Maybe someday manufacturing
jobs will return to America, or maybe citizens will finally adapt to the new economy. For now,
all the American people can do is prepare the future and hope for a better tomorrow.
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Work Cited
"Adults With College Degrees in the United States, by County." The Chronicle of Higher
Education. The Chronicle of Higher Education, 23 Jan. 2011. Web. 28 Oct. 2013.
Atkinson, Robert D., et al. Worse Than the Great Depression: What Experts Are Missing About
American Manufacturing Decline. March 2012. PDF.
Coolidge, Calvin. "Factory Quotes." BrainyQuote. BrainyQuote®, n.d. Web. 23 Oct. 2013.
"Economy in The Gilded Age." Shmoop. Shmoop, 2013. Web. 28 Oct. 2013.
Gray, Dave. "Everything Is a Service." Dachis Group. Dachis Group, 21 Nov. 2011. Web. 28
Oct. 2013.
Hagenbaugh, Barbara. "U.S. Manufacturing Jobs Fading Away Fast." USATODAY. USA
TODAY, 12 Dec. 2002. Web. 28 Oct. 2013.
Katel, Peter. "Reviving Manufacturing- Can the U.S. Regain Its Global Lead - and Factory
Jobs?" CQ Researcher. CQ Press, 22 July 2011. Web. 27 Oct. 2013.
Kelly, Martin. "Industrial Revolution People, Inventions, and Events." About.com American
History. About.com, n.d. Web. 23 Oct. 2013.
Nash-Hoff, Michele. "American Manufacturing Has Declined More Than Most Experts Have
Thought." The Huffington Post. TheHuffingtonPost.com, 28 Mar. 2012. Web. 28 Oct.
2013.
Perry, Mark J. "Manufacturing Jobs Drop To Lowest Level Since 1941, Below 9% of Workforce
for the First Time." Carpe Diem. N.p., 20 Aug. 2009. Web. 23 Oct. 2013.
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"Rust Belt" Dictionary of American History. 2003. Encyclopedia.com. 28 Oct. 2013
"The Gilded Age & the Progressive Era (1877–1917)." SparkNotes. SparkNotes, 2013. Web. 28
Oct. 2013.
Thompson, Loren. "Intelligence Community Fears U.S. Manufacturing Decline." Forbes. Forbes
Magazine, 14 Feb. 2011. Web. 28 Oct. 2013.
Worstall, Tim. "Why Mass Employment in Manufacturing Isn't Coming Back: It's The
Productivity." Forbes. Forbes Magazine, 27 Apr. 2012. Web. 28 Oct. 2013.
Zelinski, Peter C. "Manufacturing in A Service Economy." Modern Machine Shop 77.1 (2004):
14. ProQuest. Web. 28 Oct. 2013.