Listen to the doom and gloom coming from a certain segment of America's politicians, and you'd think this country has become a desolate graveyard of manufacturing. Huge numbers of people are out of work, countless factories have been shuttered, once great industries are dying, etc. etc. etc.

And certainly there is some truth behind all this lamenting and finger pointing. From the perspective of those who've made their livings working on factory floors, a healthy manufacturing sector is one that employs plenty of people at decent wages. And by that measure, American manufacturing is in inexorable decline, dragging many families into economic hardship as it sinks.

That's a genuine political and human problem that concerns us all, but as Daniel Gross pointed out recently in an article in strategy + business that's hardly the whole story. "U.S. manufacturing just had another big month," he announces, kicking off a fascinating piece that presents a strong counter-argument to those who look at U.S. manufacturing and only see collapse and regret.

American factories are selling more than ever before.

"In many significant ways, U.S. manufacturing is thriving. The point of manufacturing is to make stuff that people and companies will buy and use, not to employ people to make stuff. And by the former measure, U.S. manufacturing is actually doing quite well," he argues. In fact, American factories are churning out more stuff than ever before, Gross explains:

Take a look at this long-term chart of industrial production, courtesy of the U.S. Federal Reserve. Over the past 100 years, the index, which measures the value of the output of the manufacturing, mining, and utilities industries, has risen steadily. But the rise has generally continued in the last several decades--decades in which the narrative was that manufacturing has been in apparent decline.

The remainder of the article offers a deep dive into exactly why there's such a disconnect between the popular understanding of the state of manufacturing in America and the objective reality of ever-increasing production, but the essence of the explanation is a shift from production of lower to higher-end goods, rising productivity, and technological advances.

It's hard to argue those three trends are anything but positive overall, despite the fact that they have resulted in genuine distress for a significant segment of Americans. Plus, Gross points out, while fewer people may work on shop floors, more people work servicing high-tech factories in jobs from truck driver to salesperson to security guard than ever before. The employment picture, while far from rosy, isn't as totally bleak as you might think.

Check out the complete article to get the full picture, but putting the details aside for a second, the basic takeaway is both simple and important, especially this year: American manufacturing (and by extension, America as a whole) isn't in as poor a state as some loud, self-interested voices would like you to believe.

Published on: Aug 3, 2016
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