President Biden is expected to quadruple tariffs on electric vehicles from China in an announcement Tuesday, according to a source familiar with the decision.
If an American “manufacturer” is competitive, it usually means it’s because we tax everyone else a ridiculous amount.
Hmm. I don’t know about that. There are some areas where the US is globally a pretty major player, like pharmaceuticals.
I think that a big factor is that in the 19th and early 20th centuries, a lot of US manufacturing was assembly-line stuff, where a lot of the process was figuring out how to take someone off a farm who didn’t have a lot of domain-specific experience, and put them into something more-productive with a very limited period of time to get them going. Low-skill labor played a big role there.
The American system of manufacturing was a set of manufacturing methods that evolved in the 19th century. The two notable features were the extensive use of interchangeable parts and mechanization for production, which resulted in more efficient use of labor compared to hand methods. The system was also known as armory practice because it was first fully developed in armories, namely, the United States Armories at Springfield in Massachusetts and Harpers Ferry in Virginia (later West Virginia), inside contractors to supply the United States Armed Forces, and various private armories. The name “American system” came not from any aspect of the system that is unique to the American national character, but simply from the fact that for a time in the 19th century it was strongly associated with the American companies who first successfully implemented it, and how their methods contrasted (at that time) with those of British and continental European companies. In the 1850s, the “American system” was contrasted to the British factory system which had evolved over the previous century. Within a few decades, manufacturing technology had evolved further, and the ideas behind the “American” system were in use worldwide. Therefore, in manufacturing today, which is global in the scope of its methods, there is no longer any such distinction.
The American system involved semi-skilled labor using machine tools and jigs to make standardized, identical, interchangeable parts, manufactured to a tolerance, which could be assembled with a minimum of time and skill, requiring little to no fitting.
Since the parts are interchangeable, it was also possible to separate manufacture from assembly and repair—an example of the division of labor. This meant that all three functions could be carried out by semi-skilled labor: manufacture in smaller factories up the supply chain, assembly on an assembly line in a main factory, and repair in small specialized shops or in the field. The result is that more things could be made, more cheaply, and with higher quality, and those things also could be distributed further, and lasted longer, because repairs were also easier and cheaper. In the case of each function, the system of interchangeable parts typically involved substituting specialized machinery to replace hand tools.
The need for firms to train uneducated people to perform only one thing in the productivity chain allowed for the use of non-specialized labor. Women and children were employed more frequently within larger firms, especially those producing furniture and clothing.
The thing is that that’s pretty labor-intensive and doesn’t require a specific skillset, and so it’s difficult to compete if you’re a country with high wages. Once lots of countries started industrializing, you could do that same work outside the US pretty readily.
But that doesn’t mean that the US doesn’t do manufacturing today. It’s just that the manufacturing it does looks different from what it once looked like. You have fewer, more-highly-skilled employees.
Manufacturing output in the United States is at an all-time high as of 2023, but employment in the sector has been stagnant following a lengthy decline in the late 20th century.
The Economist reported in January 2017 that manufacturing historically created good paying jobs for workers without a college education, particularly for men. The jobs paid well enough so that women did not have to work when they had young children. Unions were strong and owners did not want to risk strikes in their factories due to large capital investments and significant on the job training. Such jobs are much less available in the post-2001 era in the U.S. though they remain available in Germany, Switzerland and Japan, leading to calls to bring those jobs back from overseas, establish protectionism, and reduce immigration.
Politically, the thing is that historically, manufacturing was something that someone without a lot of specialized skill could do and still make a wage that was comparatively-solid, and so that’s why there’s political impetus behind wanting manufacturing jobs. Having manufacturing jobs that require a highly-skilled workforce isn’t gonna help if your concern is jobs with a low barrier to entry.
I remember an episode that NPR: Planet Money did a decade back that summarized it pretty well.
Larry Sills is the CEO of Standard Motor Products, like his dad and his grandfather before him. The company makes replacement parts for car engines. Larry grew up with the company, and he has seen the workforce change over the years. A few decades ago, a lot of his workers had no high school degree. Some couldn’t read.
“We had a plant in Connecticut where we didn’t realize it, but they were illiterate,” he says. “And then when we switched to the next generation, we had to be able to read the instructions. To our astonishment, they couldn’t do it.”
But in today’s factory, workers don’t just have to know how to read.
“We have a microscope, a hot stand, snap gauges, ID gauges,” Standard employee Ralph Young says. “We use bore mics, go-no-go plugs.”
Young is the perfect model of the new factory worker. He has an encyclopedic knowledge of metals and microscopes, gauges and plugs. He works on the team that makes fuel injectors, which require precision engineering. At the heart of the assembly process is an automated machine run by a computer process known as CNC.
“When I came here 20 years ago, we didn’t have CNC equipment,” he says. “It was more of the hammer and screwdriver fix, to where now it’s all finesse.”
“Now it’s all finesse” could be the motto of American manufacturing today. In factories around the country, manufacturing is becoming a high-tech, high-precision business. And not everyone has the finesse to run a CNC machine.
I can read, I’ve had some computer classes, and I have a Bachelor of Arts degree. But when I asked Ralph’s boss, Tony Scalzitti, if he would hire me and train me on the job, his answer surprised me.
“No,” he said. “The risk of having you being able to come up to speed with training would be a risk I wouldn’t be willing to take.”
To become like Ralph, I’d have to learn the machine’s computer language. I’d have to learn the strengths of various metals and their resistance to various blades. And then there’s something I don’t believe I’d ever be able to achieve: the ability to picture dozens of moving parts in my head. Half the people Tony has trained over the years just never were able to get that skill.
And if you don’t get that skill, a mistake on this machine can be catastrophic. All the work that’s done here happens on a scale of microns. One micron is four-hundred-thousandths of an inch. A human hair, for example, is 70 microns thick. Here, you cannot be off by one-tenth the thickness of a hair.
“A 7- or 8-micron wrong adjustment in this machine cost us a $25,000 workhead spindle,” Young says. “Two seconds, we could lose $25,000.”
“That’s why I wouldn’t hire you,” Scalzitti says."
It’s not all Ralphs who work here.
Madelyn “Maddie” Parlier is more like the old style of worker. She does have a high school diploma, but no further education. She works on a simple machine that seals the the cap of a fuel injector onto the body. All she does is insert two parts and push a button. It requires no discretion, no judgment. There’s only one way to run it: the right way.
“It does it for you,” Maddie says. “All you do is put the piece in, push the clamps down, and push your finger.”
There are a lot of things Ralph knows that Maddie wishes she knew. She wants to know how many microns thick the different parts are. She wants to know the computer language used on the machine she runs. She wants to know all the things that make Ralph’s job prospects so much brighter than her own. And until she knows those things, her future is far less certain.
Maddie has a job, I learned, because of some simple math. A machine could easily replace her — a robotic arm could put the parts in and take them out — but it would cost around $100,000. Maddie makes a lot less than that, and, for now, the math is in her favor.
But if the price of a robotic arm goes down, or a factory in China learns how to make that part for a lot less, Maddie’s job is at risk. Simple calculations like that have cost around 5 million factory workers their jobs over the past decade.
Hmm. I don’t know about that. There are some areas where the US is globally a pretty major player, like pharmaceuticals
That’s not manufacturing, it’s the research.
And the research is only there because our shitty healthcare system is the only one that would pay for it.
In America the poor subsidize the cost for the most cutting edge treatments only the wealthiest can afford. Pretty much the opposite of every other developed country.
Actually making the medicine isn’t complicated, if it wasn’t for parents rival companies could make generic in a very short timeline and very low price.
That field only does well because of friendly legislation that, you guessed it, comes from lobbying.
It says a lot your one example of it being wrong, was a great example of me being right.
That’s simply not true. Scale up and manufacturing of even the simplest small-molecule drugs even after all the clinical research has been completed is incredibly complex and hard to manufacture consistently, let alone replicate.
Even with access to all the research and manufacturing and quality testing procedures and records of a successfully manufactured drug (which a generic competitor would not have), I have seen and been part of an expansion facility at the very same location using the exact same raw material suppliers and exact same serial # equipment and even the same cleaning and manufacturing and quality testing lab employees just moved into a new building, take years and dozens of batches to get to the same level of consistent safety, identity, strength, purity, and quality as the previous manufacturing line after it was shut down to make room for a newer product. I’ve seen final product yield drop by nearly half from batch to batch just because the supplier of one raw material used as an excipient switched their own manufacturing process to make a powder slightly more consistently fine-grained and the mixing process no longer worked the same - and it took months of investigation to figure that out, plus much more time and money to find a solution and demonstrate it didn’t change the final product over the next three batches (a regulatory requirement).
Change over to modern large-molecule biologics where you have to grow them up in bioreactors, and things get a lot more complex to get it right and even harder to get consistent. You can’t just follow a recipe and double the ingredients to get twice the product.
Consider an extremely common drug like levothyroxine that’s been around for nearly a century and has many generic manufacturers because it’s one of the “easiest” and most well-understood essential drugs to make. It has such a low therapeutic window that the exact same process between two manufacturers, using the exact same raw material suppliers, passing testing with the exact same results, can result in such drastically inconsistent levels in the same patient at the exact same dose that many people are unable to switch from a one generic or brand manufacturer to another once their doctor has managed to find the right dose to keep their T4 levels stable. Something as mundane as the shape of the tablet press can make a huge difference even when dissolution is the same.
You said, it is easy and inexpensive to manufacture generics and that the expense for drug production goes into research.
Did you not read the article you linked, or did you just not read my comment before downvoting it? It says the exact same thing in the “Controversies in FDA Bioequivalence Testing” section about the efficacy of the drug I listed as a specific example of generics not actually showing bioequivalence…TSH, free T4, and T3 in the blood are how the efficacy of levothyroxine is measured. Here, I’ll quote it for you.
Unresolved concerns surrounding bioequivalence undermine patients’ and health care providers’ confidence in making generic substitutions. Bioequivalence studies do not assess clinical or surrogate markers that directly correlate with efficacy and/or toxicity (e.g., thyroid-stimulating hormone [TSH], seizures, transplant rejection, international normalized ratio). In addition, manufacturers do not undertake comparative studies against other generic products with the same active ingredient, yet the FDA maintains that all approved generic medications are bioequivalent
Hmm. I don’t know about that. There are some areas where the US is globally a pretty major player, like pharmaceuticals.
I think that a big factor is that in the 19th and early 20th centuries, a lot of US manufacturing was assembly-line stuff, where a lot of the process was figuring out how to take someone off a farm who didn’t have a lot of domain-specific experience, and put them into something more-productive with a very limited period of time to get them going. Low-skill labor played a big role there.
https://en.wikipedia.org/wiki/American_system_of_manufacturing
The thing is that that’s pretty labor-intensive and doesn’t require a specific skillset, and so it’s difficult to compete if you’re a country with high wages. Once lots of countries started industrializing, you could do that same work outside the US pretty readily.
But that doesn’t mean that the US doesn’t do manufacturing today. It’s just that the manufacturing it does looks different from what it once looked like. You have fewer, more-highly-skilled employees.
[continued in child]
[continued from parent]
https://en.wikipedia.org/wiki/Manufacturing_in_the_United_States
Politically, the thing is that historically, manufacturing was something that someone without a lot of specialized skill could do and still make a wage that was comparatively-solid, and so that’s why there’s political impetus behind wanting manufacturing jobs. Having manufacturing jobs that require a highly-skilled workforce isn’t gonna help if your concern is jobs with a low barrier to entry.
I remember an episode that NPR: Planet Money did a decade back that summarized it pretty well.
https://www.npr.org/sections/money/2012/01/13/145039131/the-transformation-of-american-factory-jobs-in-one-company
That’s not manufacturing, it’s the research.
And the research is only there because our shitty healthcare system is the only one that would pay for it.
In America the poor subsidize the cost for the most cutting edge treatments only the wealthiest can afford. Pretty much the opposite of every other developed country.
Actually making the medicine isn’t complicated, if it wasn’t for parents rival companies could make generic in a very short timeline and very low price.
That field only does well because of friendly legislation that, you guessed it, comes from lobbying.
It says a lot your one example of it being wrong, was a great example of me being right.
Thanks!
That’s simply not true. Scale up and manufacturing of even the simplest small-molecule drugs even after all the clinical research has been completed is incredibly complex and hard to manufacture consistently, let alone replicate.
Even with access to all the research and manufacturing and quality testing procedures and records of a successfully manufactured drug (which a generic competitor would not have), I have seen and been part of an expansion facility at the very same location using the exact same raw material suppliers and exact same serial # equipment and even the same cleaning and manufacturing and quality testing lab employees just moved into a new building, take years and dozens of batches to get to the same level of consistent safety, identity, strength, purity, and quality as the previous manufacturing line after it was shut down to make room for a newer product. I’ve seen final product yield drop by nearly half from batch to batch just because the supplier of one raw material used as an excipient switched their own manufacturing process to make a powder slightly more consistently fine-grained and the mixing process no longer worked the same - and it took months of investigation to figure that out, plus much more time and money to find a solution and demonstrate it didn’t change the final product over the next three batches (a regulatory requirement).
Change over to modern large-molecule biologics where you have to grow them up in bioreactors, and things get a lot more complex to get it right and even harder to get consistent. You can’t just follow a recipe and double the ingredients to get twice the product.
Consider an extremely common drug like levothyroxine that’s been around for nearly a century and has many generic manufacturers because it’s one of the “easiest” and most well-understood essential drugs to make. It has such a low therapeutic window that the exact same process between two manufacturers, using the exact same raw material suppliers, passing testing with the exact same results, can result in such drastically inconsistent levels in the same patient at the exact same dose that many people are unable to switch from a one generic or brand manufacturer to another once their doctor has managed to find the right dose to keep their T4 levels stable. Something as mundane as the shape of the tablet press can make a huge difference even when dissolution is the same.
It’s not at all easy to manufacture drugs.
Yeah, because generics don’t save patients hundreds of billions of dollars…
https://www.uspharmacist.com/article/how-generic-drugs-are-made
You said, it is easy and inexpensive to manufacture generics and that the expense for drug production goes into research.
Did you not read the article you linked, or did you just not read my comment before downvoting it? It says the exact same thing in the “Controversies in FDA Bioequivalence Testing” section about the efficacy of the drug I listed as a specific example of generics not actually showing bioequivalence…TSH, free T4, and T3 in the blood are how the efficacy of levothyroxine is measured. Here, I’ll quote it for you.