There’s an odd sentiment often observable on social media: Some of the hardest supporters of reshoring manufacturing are those who would never work in manufacturing, and who lack the requisite skills to run an industry in this country. The entire situation is reminiscent of an old meme showing a bunch of women, given a choice to study in a STEM field or gender studies, choosing gender studies to learn how to protest the lack of women in STEM. This moment is somewhat similar; you find everyone from housewives to Great Books course enjoyers are deeply worried about the lack of manufacturing in this country. Unfortunately, there is a problem: They themselves don’t want to work in any of those jobs, but instead want to be the elite leaders of men, i.e. the others who actually work in those jobs.
There’s nothing wrong with aspirational elites. The problem is when those aspirational elites misconstrue the structural nature of the problem they are debating, and instead rile themselves up to a frenzy. The problem for manufacturing jobs in the U.S. is difficult, and needs solutions that won’t be about fighting economic wars from three decades back.
My interest in this subject increased as I started to research a short paper on drones in the U.S., and started to ask around about why the U.S. is losing drones and automation competition with China. Consider what Mike Rowe recently said in Aspen: “We’ve been telling kids for 15 years to learn to code. Well, AI is coming for the coders. It’s not coming for the welders, the plumbers, the steamfitters, the pipefitters, the HVAC, or the electricians.”
Of course, you might say that AI will spare neither. It is quite evident that AI is coming for both the bureaucrats and blue collars. It is not just ChatGPT doing boring spreadsheets or writing emails. We have seen AI solutions and automation in the last two years in the fields of cleaning, services, food delivery, and hospitality; driving, guarding and policing; fruit picking, planting, and harvesting; and warfighting. In fact, the only jobs that might survive untouched are those requiring original analytical skills or innovation. If I weren’t a military historian myself—I don’t want to flood my own field—I’d have asked everyone to study comparative or military history and produce whatever original research they could, including coining new doctrines or writing revisionist interpretations of old classics. Originality and innovation will survive AI and automation. The rest, perhaps not so much.
But there will be other jobs too. The history of industrialization demonstrates that there will always be new fields. Consider when British textile mills resulted in total destruction of the hand-weaving industry in India: There was rapid job growth, in well, mills. When computerization happened in the 1980s, ticketing clerks lost their jobs, but hundreds of thousands of jobs were created in fields requiring any form of computers. Airplanes undercut oceanic shipping lanes, but created new industries. In sum, it is not just drones or manufacturing. There will always be new jobs.
So, why are we potentially losing to China? Any country that is training a future such workforce will own the future, and currently trends are not in favor of the U.S., for a variety of reasons. So, why are we trying to pretend that in any way the U.S. can magically return to 1956? The problem is different.
“One of the great surprises is everyone had believed that people would pull up stakes and move on. In fact, we find the opposite. People in the most adversely exposed places become less likely to leave. They have become less mobile,” MIT economist David Autor recently said. “Those were basically labor-intensive jobs, the kind of low-tech sectors that we will not be getting back. You know—commodity furniture and assembly of things, shoes, construction material. The US wasn’t going to keep them forever, and once they’re gone, it’s very unlikely to get them back.”
His conclusion is stark:
We’re in the midst of a totally different competition with China now that’s much, much more important. Now we’re not talking about commodity furniture and tube socks. We’re talking about semiconductors and drones and aviation, electric vehicles, shipping, fusion power, quantum, AI, robotics. These are the sectors where the US still maintains competitiveness, but they’re extremely threatened. China’s capacity for high-tech, low-cost, incredibly fast, innovative manufacturing is just unbelievable. And the Trump administration is basically fighting the war of 20 years ago. The loss of those jobs, you know, was devastating to those places. It was not devastating to the US economy as a whole. If we lose Boeing, GM, and Apple and Intel—and that’s quite possible—then that will be economically devastating.
An average manufacturing laborer in Vietnam earns $200 a month. New manufacturing companies in Turkey do not have to pay a ridiculous amount of overhead because legal costs and regulations are minimal. Forcibly reshoring those jobs won’t make things “affordable” by any means; indeed, it is impossible because of the exorbitant labor costs and absurd regulations in this country. It will, however, result in further capital outflow.
The key issue appears to be that, first, everyone wants to own a shop and not work in it, at least not at a cost that will make the product affordable. Second, everyone wants their kids to go to college. Every family that sends their kids to college aspires to elite status, and understandably does not want to work in factories or mines. Ask a single mother who is pushing her kids to go to college while working two jobs; see what life she wants for her kids. Third, the cumulative growth of a high-earning society makes the cost of living higher. Naturally, even if one wants to, he or she cannot afford to start a company and pay a “below average salary” to those who would work there and expect a decent standard of living. Naturally, those jobs move further out to places like Vietnam and Mexico.
I have no solution for this. But historically there have been two different ways out.
First, technology and further rapid industrialization solved both the problem of labor, as well as opened up unexpected new avenues and job fields. In short, supply creates its own demand.
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Second, great powers turn to colonization, given their technological superiority and their self-perpetuating need for resources, markets, and manpower. The 19th-century European empires are classic examples. In short, if the U.S. needs more resources and manpower to compete with China, it will somehow seek to expand to places which will provide the said resources (apologies in advance, Greenland!), and it will seek the manpower demanded by growth. It is easy to forget that Manifest Destiny and the expansion in the continental West also resulted in the second major wave of European and Chinese migration to the USA.
There is also a rare and unlikely third option: The U.S. retrenching from all competition with China, and allowing China to simply supplant the U.S. as hegemon given its natural heft over Europe and America combined. A similar argument was made in the 1970s about ascendant Soviet power in two-thirds of decolonized Africa. Instead, the computer revolution happened in the ’80s, and the rest is history.
I am not sure how to thread the needle, and I wish I had predictive powers. But everything—from mass migration, to deteriorating race relations, to surplus elites, to low-wage foreign labor, to the manufacturing glut, to technological advances in AI and automation, to foreign policy—is ultimately auxiliary to the increasing strategic competition with China. And given that strategic competitions have their own momentums, that might lead to abrupt and total great power collapses. The USSR was a peer rival merely 35 years ago. Unless the United States can manage to either create or find a mass of “high tech/low cost” workers, dark days are over the horizon.
