Manufacturing Held Up Better Than Rest of the Economy During Coronavirus Crisis
The coronavirus is demonstrating the wisdom of a key point of Donald Trump’s economic vision: the necessity of having a thriving manufacturing sector.
Manufacturing added 356,000 workers in June and 250,000 in May. April was virtually unchanged. Two hundred and ninety thousand of the most recent gains were in durable goods manufacturing, largely reflecting the reopening of auto plants.
Manufacturing jobs held up much better than the broader economy, suggesting that they are more reslient in the face of a public health care crisis. Compared with a year ago, manufacturing employment is down 5.8 percent. Total private sector employment is down 9.8 percent.
Alan Tonelson points out that this same pattern holds up when measured against February, the last month before the pandemic hit the U.S. economy.
Further, overall manufacturing’s record of pandemic-era resilience continued in June. Its monthly jobs growth was only 3.03 percent – slower than the rate for the total non-farm sector (3.61 percent) and the private sector (4.27 percent).
But a main reason is that manufacturing has taken a much smaller CCP Virus hit than the rest of the economy. That 5.89 percent employment loss since February has been considerably less than that of the non-farm sector (9.62 percent) or the private sector (10.17 percent).
“Mainly, manufacturing held up better than the rest of the American jobs market, and within manufacturing, the swings have been dominated by the automotive sector,” Tonelson writes.
The important takeaway is that an American economy with abundant manufacturing jobs would be less fragile to the coronavirus than one increasingly centered on personal service jobs.