Dick Palmer picked a poor example about the decline of manufacturing when he mentioned Rochester, New York, home of Eastman Kodak. How many rolls of film has he been buying recently? Few people use film anymore; most cameras are now digital and can take many more pictures than film cameras. In fact, it is difficult to even sell a film camera on eBay. "State exports may be up but nation still hurting", Dick Palmer, Duluth Budgeteer, 2011-01-06.
Technological changes have led to many more job changes, but I'll come back to these in a bit.
Another contributor to job changes for over two hundred years has been low cost manufacturing, whether by low-cost labor or high productivity. Weavers in England and India were put out of business by power looms in England. Instead of high-skilled weavers, children could and did operate the machines.
New Englanders stole some of the designs and set looms up in Massachusetts. They hired hundreds of young women to operate the machines. Feeling exploited, workers organized into unions to push for more rewards for their labor.
Then the textile mills lowered their costs by moving to the South where unions were not tolerated. Even then, people found opportunity for better paying jobs and to attract labor, the companies had to raise wages.
Then shipping became cheaper, and textile companies found even lower cost labor in Asia and Central America. And as labor becomes more expensive in those countries, the companies move on to other countries.
Higher productivity means fewer people are needed to manufacture the same amount of goods. Higher productivity comes from more and more mechanization and now computerization. Even in the 80s, Ford could produce cars for less than GM because it used more mechanization and fewer workers. Fewer highly skilled machinists are needed thanks to numerically-controlled machine tools. Write a little program to make the cuts, put the code into the machine, and have a cup of coffee.
My father was a well-regarded dental prosthetic technician specializing in crowns. I have a folder of letters from dentists praising his work. When I got a crown last year, the dentist waved a wand over my teeth, an image appeared on the computer screen, he rotated the image and made some adjustments, he clicked OK, and a machine in the basement proceeded to make the crown. We chatted awhile, and then he went downstairs to get the crown. He put it in my mouth, pulled it out, made some adjustments with his drill, put it back in again, had me grind my teeth, and so on. In two hours, I had a new crown in my mouth, not a temporary to be replaced in three weeks and several visits later.
What is manufactured has changed dramatically in the last few decades.
When I worked at Univac programming mainframes mainframes in the 1960s, dozens of people would thread wires through little iron donuts for the main memory. When I started, a large memory had less than 400,000 characters, each character represented by six donuts. When I left nearly twenty years later, a large memory had about six million characters on an array of integrated circuits on several sets of large circuit boards. Now I carry eight billion characters of memory in my shirt pocket.
The miles of film that Eastman Kodak spewed out and put in little boxes have been replaced by memory cards the size of the end of one of those boxes. On a 1991 trip to Japan I shot nine rolls of film; my cost was over one hundred dollars for film and processing. On a 2007 trip to Japan I shot almost forty percent more pictures on a single memory card that cost less than fifty dollars, and I used the card over and over again for many hundreds of pictures more. My cost of processing was my time to download the pictures to my computer.
What is considered manufacturing has changed even more dramatically. We don't consider software on a disk or downloaded from a website as a manufactured product, but it is. It's just that the balance between design and physical rendering has moved dramatically to the design side. I haven't checked, but I assume that Apple Computer has more employees today than IBM and the "Seven Dwarves" of mainframes had thirty years ago. Apple definitely has more customers spending a lot more money than the mainframe manufacturers did.
The problem is not the decline of an economic sector, but the rate of change of the economy. I think few people, whether individuals or people in government, business, and education, have sufficient understanding of the change. Too many people are judging tomorrow by what happened a decade ago. And too many people are assuming that solutions that seemed to work twenty years ago are going to work today.
Abraham Lincoln said it 165 years ago, "As our case is new, so must we think anew."
To his credit, Dick Palmer has started to think anew. He does end his column with and elaboration on "The secret ingredient to success today is education…"
