EconPapers    
Economics at your fingertips  
 

The Transformation of Manufacturing and the Decline in US Employment

Kerwin Kofi Charles, Erik Hurst and Mariel Schwartz

NBER Macroeconomics Annual, 2019, vol. 33, issue 1, 307 - 372

Abstract: Using data from a variety of sources, this paper comprehensively documents the dramatic changes in the manufacturing sector and the large decline in employment rates and hours worked among prime-age Americans since 2000. We use cross-region variation to explore the link between declining manufacturing employment and labor market outcomes. We find that manufacturing decline in a local area in the 2000s had large and persistent negative effects on local employment rates, hours worked, and wages. We also show that declining local manufacturing employment is related to rising local opioid use and deaths. These results suggest that some of the recent opioid epidemic is driven by demand factors in addition to increased opioid supply. We conclude the paper with a discussion of potential mediating factors associated with declining manufacturing labor demand, including public and private transfer receipt, sectoral switching, and interregion mobility. We conclude that the decline in manufacturing employment was a substantial cause of the decline in employment rates during the 2000s, particularly for less educated prime-age workers. Given the trends in both capital and skill deepening within this sector, we further conclude that many policies currently being discussed to promote the manufacturing sector will have only a modest labor market impact for less educated individuals.

Date: 2019
References: Add references at CitEc
Citations: View citations in EconPapers (45)

Downloads: (external link)
http://dx.doi.org/10.1086/700896 (application/pdf)
http://dx.doi.org/10.1086/700896 (text/html)
Access to the online full text or PDF requires a subscription.

Related works:
Chapter: The Transformation of Manufacturing and the Decline in US Employment (2018) Downloads
Working Paper: The Transformation of Manufacturing and the Decline in U.S. Employment (2018) Downloads
Working Paper: The Transformation of Manufacturing and the Decline in U.S. Employment (2018) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ucp:macann:doi:10.1086/700896

Access Statistics for this article

More articles in NBER Macroeconomics Annual from University of Chicago Press
Bibliographic data for series maintained by Journals Division ().

 
Page updated 2025-03-31
Handle: RePEc:ucp:macann:doi:10.1086/700896