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Upskilling and Downsizing in American Manufacturing

Upskilling and Downsizing in American Manufacturing finds that workers with postsecondary education now outnumber workers with a high school diploma or less in the industry.
Visit cew.georgetown.edu/manufacturing to learn more. Contact cewgeorgetown@georgetown.edu with questions.

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Upskilling and Downsizing in American Manufacturing

  1. 1. By: Anthony P. Carnevale, Neil Ridley, Ban Cheah, Jeff Strohl, and Kathryn Peltier Campbell June 13, 2019
  2. 2. Overview • Downsizing: Once the powerhouse of the industrial economy, manufacturing today plays a smaller role in an economy dominated by services—about 7 million manufacturing jobs disappeared from the US workforce between 1979 and 2017. • Upskilling: Manufacturing increasingly requires workers with education beyond a high school diploma—today, 56% of workers in the industry have postsecondary education. • Industry transformation: Automation, globalization, and the growth of a networked economy have contributed to these changes. 2
  3. 3. Three trends have altered the manufacturing industry • Automation: The industry now has fewer workers, but more robots, so output per worker has increased from $293,000 in 1979 to $485,000 in 2017. Total manufacturing output has grown by more than 60% since 1991. • Globalization: Manufacturing job losses have accelerated as international competition has increased. Since the 1960s, international trade has more than tripled as a share of GDP, rising from about 10% to almost one third of the economy. • Networked economy: Growth of a more integrated, global economy with an expanded role for business-to-business services increased domestic outsourcing. 3 Georgetown University Center on Education and the Workforce
  4. 4. • Manufacturing’s share of employment fell from 22% in 1979 to 9% in 2017. • Manufacturing employment will continue to decline in the next decade, dropping by 2% or 253,000 jobs. 4 Georgetown University Center on Education and the Workforce The manufacturing workforce has downsized overall
  5. 5. • Downsizing and upskilling upended the structure of good jobs within manufacturing. • Before 2005, workers with a high school diploma or less held the largest number of good jobs in manufacturing. • Workers with bachelor’s degrees greatly increased their number of good jobs from 2.8 million in 1991 to 3.6 million in 2016. 5 Georgetown University Center on Education and the Workforce The remaining manufacturing labor force has been upskilling
  6. 6. Services industries have replaced manufacturing in the economy 6 Georgetown University Center on Education and the Workforce • The production recipes for materials, goods, and services have changed dramatically since the early 20th century. • These recipes depend less on agricultural and industrial production and more on services, especially finance and professional and business services.
  7. 7. • The industry is not the job generator that it used to be. • But manufacturing is still the top provider of good jobs for workers without a bachelor’s degree in 35 states. 7 Georgetown University Center on Education and the Workforce Manufacturing still provides good jobs in more than half of states
  8. 8. Policy Recommendations • Support research and technology development that enables firms to develop innovative products and better processes. • Bolster the ability of small- and medium-sized manufacturers to compete in a global marketplace. • Build the manufacturing workforce of the future by rethinking career and technical education and apprenticeship programs. • Improve existing worker transition programs to provide comprehensive support for workers who lose their jobs. 8
  9. 9. 9 cew.georgetown.edu/Manufacturing More Information cew@georgetown.edu Facebook.com/ GeorgetownCEW linkedin.com/company/ georgetowncew @GeorgetownCEW Slideshare.net/ CEWGeorgetown YouTube.com/ CEWGeorgetown

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Upskilling and Downsizing in American Manufacturing finds that workers with postsecondary education now outnumber workers with a high school diploma or less in the industry. Visit cew.georgetown.edu/manufacturing to learn more. Contact cewgeorgetown@georgetown.edu with questions.

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