Recent US Manufacturing Employment: The Exception that Proves the Rule

This Working Paper challenges the widely held view that trade has been the primary reason for the declining share of manufacturing employment in the United States. Lawrence also shows that faster productivity growth over many decades has interacted with unresponsive demand to cause a declining share of employment in manufacturing in the United States and other industrial economies. Since 2010, however, slower productivity growth in manufacturing has been associated with more robust performance in manufacturing employment. The evidence suggests that the productivity slowdown is real and that fears that robots and other technological advances in manufacturing will displace large numbers of jobs appear unfounded.