The last US manufacturing job will disappear in 2042

Well the manufacturing employment picture looks very bleak. Some of the data is almost unreal. In one year, between August 2008 and August 2009, we have lost 1,616,000 million manufacturing jobs. (I need to double check this because the number is just so huge). In other words, we lost 12% of all manufacturing jobs in one year. It is almost unbelievable.

But that is not the point of the post. Today's point is, we can predict when the last manufacturing job will leave the US. In a tongue in cheek kind of way. It is the year 2042. Through the magic of statistics we can use the data on manufacturing employment levels to predict when the level of manufacturing jobs will be zero.

Using simple regression techniques we can compute the slope of a line that best fits our data. The slope is minus 32,000 jobs. Meaning we lose 32,000 manufacturing jobs a month or 384,000 per year. So, if we are currently at 12,783,000 jobs and we lose approximately 400,000 per year, then in the year 2042 we will be at zero.


Here is the regression for the time period 1995 to 2009.



Here is the forecast to zero manufacturing jobs in the year 2042



I just wanted to make three notes. One, for many reasons regression analysis is at the heart of many of the analyses that economists use. Second, extending the time period out make the current job loses look severe in the 2nd graph. Third, The graph is further skewed because the year 1995 was a relative peak for manufacturing jobs, so any decline will look bad. However, 12% loss this year is crazy.

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