One friend recently said to me, “The problem is we don’t make anything anymore!”
Disagreeing, a San Francisco Fed report says that 88.5% of consumer spending is for goods and services made here. In addition, businesses are buying US made goods that include space related items, gas turbines, and computer chips.
Maybe though it is not about what we make. Instead, here, one Forbes commentator suggests that we focus on what people learn from manufacturing. Noting that most of the Kindle 2 is made in China, South Korea, and Taiwan, and then assembled in China, he worries that outsourcing provides a springboard for innovation from which we will not benefit.
The Economic Lesson
Manufacturing takes us to jobs and innovation. New products and processes fuel economic growth. Yes, we make a lot more than many people realize such as the new products and services described at this WSJ article, “Where the Action Is.”
An Economic Question: Economists have been debating whether current unemployment is primarily caused by the business cycle or structural changes in the economy that make existing jobs outdated. How might government initiatives attack each type of unemployment?