Learning the Wrong History of Declining Manufacturing Employment

For decades, politicians have promised to bring back factory jobs. A new working paper from a pair of liberal economists at Stanford’s Institute for Economic Policy Research tries to make sense of what actually drives manufacturing employment . It’s full of useful data. But in trying to defend the conventional wisdom against tariffs, it ends up making the case for exactly the policies—Donald Trump’s tariffs—that it tries to argue against.

Economists Jared Bernstein and Daniel Posthumus , in a working paper released last month, examined manufacturing employment from 1949 to today . Their decomposition is straightforward: employment growth equals output growth minus productivity growth. The story is clear.

From 1949

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