NCPA - National Center for Policy Analysis

Wanted: Blue-Collar Workers

December 9, 2011

There is a shortage of skilled workers capable of running increasingly sophisticated, globally competitive factories, says Joel Kotkin, a distinguished presidential fellow at Chapman University in Orange County, California.

Driving the skilled-labor shortage is a remarkable resurgence in American manufacturing.

  • Since 2009, the number of job openings in manufacturing has been rising, with average annual earnings of $73,000, well above the average earnings in education, health services and many other fields, according to Bureau of Labor Statistics data.
  • Production has been on the upswing for over 20 months, thanks to productivity improvements, the growth of export markets (especially China and Brazil), and the lower dollar, which makes American goods cheaper for foreign customers.
  • Also, as wages have risen in developing countries, notably China, the production of goods for export to the United States has become less profitable, creating an opening for American firms.

The industrial resurgence comes with a price: a soaring demand for skilled workers.  

  • Even as overall manufacturing employment has dropped, employment in high-skill manufacturing professions has soared 37 percent since the early 1980s, according to a New York Federal Reserve study.
  • These jobs can pay handsomely -- an experienced machinist at the Ariel Corporation in Mount Vernon, Ohio, earns over $75,000.

The shortage of industrial skills points to a wide gap between the American education system and the demands of the world economy.  For decades, Americans have been told that the future lies in high-end services, such as law, and "creative" professions, such as software-writing and systems design.  This has led many pundits to think that the only real way to improve opportunities for the country's middle class is to increase its access to higher education.

The oversupply of college-educated workers is striking, however, when you contrast it with the growing shortage of skilled manufacturing workers.  A 2005 study by Deloitte Consulting found that 80 percent of manufacturers expected a shortage of skilled production workers, more than twice the percentage that expected a lack of scientists and engineers and five times the percentage that expected a lack of managerial and administration workers.

Source: Joel Kotkin, "Wanted: Blue-Collar Workers," City Journal, Autumn 2011.

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