Is that even possible? If so, it is an eye opener for what is happening in the American economy and what is causing the MAGA movement.
Let’s follow the evidence.
According to this article https://www.npr.org/2025/05/09/nx-s1-5375146/trump-tariffs-factory-jobs-nostalgia?
there are 12.7 million manufacturing jobs in America, down from an all-time high of 19.6 million in 1979.
According to this data base,
https://www.statista.com/statistics/437763/employment-level-in-canada-by-industry/
there are 1.8 million manufacturing jobs in Canada. Applying the standard 1-to-10 ratio (population ratio) that means scaled up proportionate to population Canada would have the equivalent of 18 million manufacturing jobs, just short of America’s all time high of almost 50 years ago, let alone the current US job rate.
That caught me completely off guard. Puts a whole new perspective on what Trump is saying about the dire state of the US. Even compared to Canada, the US is in the pits.
Here is another data bomb. One quarter of those US manufacturing jobs are held by immigrants. Not sure WHAT to make of that one.
America does have a problem regarding manufacturing jobs. But tariffs certainly are NOT the solution. If Canada can out-perform the US per capita without the trade barriers of tariffs, exactly what does that say about the condition America is in?
You can’t just focus on number of workers. You need to take into account the productivity of the workers as well. A farm that’s entirely sown and reaped by hand could have 100 workers compared to another farm that has 5 workers with machinery, and yet the one with fewer workers could produce more food and value. It’d be wrong to say the farm with 5 workers is in a dire state just because of their low worker count.
Wikipedia has a list of countries by productivity of workers. While it’s not focused on manufacturing specifically, the US has some of the most productive workers in the world and is significantly ahead of Canada. We likely have more workers per capita because each worker is less productive.
Anecdotally, I work at a Canadian manufacturing plant that’s owned by an American company. The machines in our plant are from the early 2000s and there’s a lot of stuff still done by hand. I’ve heard the US plants have the most cutting edge machines and produce 2 to 3 times as much product that we do in a day. Apparently, the only reason why the company has not gotten rid of our machines and turned the plant into a warehouse is because they pay Canadian workers comparatively less than their US workers. While the Canadian factories aren’t producing nearly as much as their American ones, the cost per unit ends up being less due to lower worker wages.
I appreciate that you recognize that so-called ‘labour productivity’* is primarily a measure of the quality and technological level of the capital that the labour is working with.
Too often, comparative measures of labour productivity and discussion focuses on hours worked, vacation days etc.
These are very much second-order.
Education levels are not second-order but Canadian workers are more literate and better educated across the board than the US manufacturing workers.
So, the real question in manufacturing (as it is in housing construction), “Why is the Canadian private sector so unwilling to invest in ongoing technological upgrading let alone innovation?”
Higher cost of labour drives capital investment to increase productivity in order to make more profit with less labour time. Lower cost of labor allows profits be made with lower productivity. Cost of labour in Canada is lower as far as I’m aware. One obvious difference is free healthcare which is not only paid by employers in the US but is also significantly more expensive.
The problem in Canada is that the apprentice program is government-controlled and monitored. If Canada put a lot more money into apprentice training, the Canadian tech industry would love to have them. It is not the wage rate that is the impediment, it is the training involved to get there. It is not the Canadian private sector that is the problem, it is the Conservative sector that just does not want to spend public money in training the work force. Private companies have absolutely no say in how Canadian high schools are operated, and what their spending priorities are.
And again agriculture and farming productivity has nothing to do with manufacturing productivity, nor with the statistics for the manufacturing sector.
Agricultural productivity is relevant insomuch as the economic definition of ‘labour productivity’ was developed for that context.
It’s a measure of return of labour to capital.
It is NOT measure of how productive the human capital of a population is.
You and others here are mistakenly confusing human capital which includes investments in
with labour productivity.
Also, you are very far off the mark if you think that Canada’s education and skills training is in any way inferior to that of the United States. On every possible measure from literacy to cognitive skills and abilities, the Canadian adult population is better than the US in international comparisons such as by the OECD.
Skilled trades programs are arguably better in Europe but not in the USA.
Agriculture is relevant only as far as you proclaim to to be. The discussion is neither about agriculture nor agricultural productivity. Yield per acre is now a much better indicator of agricultural success than farm labor productivity.
I have absolutely no idea where you got the notion that I thought Canada’s educational system is inferior to that of America. That notion is just silly. What I am saying is that the government is not putting enough public money into our highly successful and highly effective apprenticeship programs. A program is only as influential to our economy as the number of students who can get into it.
Fair enough.
There are genuine questions about whether or not the federal government should have given in to the provinces and territories in the 1990s regarding vocational and labour market training.
Both of these, and post secondary, are federal jurisdiction or shared jurisdiction at best. (But accreditation of professional associations and credentials is provincial.)
The federal government did its best to continue to directly fund these kinds of programs but the provinces, especially but not exclusively Quebec, felt strongly that this was preventing them to set their own socioeconomic development priorities.
It sounds like both the CPC and LPC federal parties had platforms that look to have the federal government step back into this space.
One has to wonder if they view the agreements they made to transfer labour market training to the provinces and territories as something they can pull back or wind up…
On the agriculture point, let’s say I am more than qualified to speak to economic terminology.
So, it may be pedantic, but it’s important to understand where economics definitions come from.
Some like labour productivity and economic rents are irrevocably tied to their origins in agricultural economic concepts.
Which means that when applied to a manufacturing or service economy, peoples’ intuition about their meaning can be very wrong.
When we’re teaching economics, we talk about ‘developing economic intuition’ but it would be much easier for students if we didn’t have to counter so many counterintuitive terms.
Or maybe the field should be less ‘Ivory Tower’ and more concerned with modern economics.
Compare the battle between MMT and Friedman, and all the old rules and definitions go out the window. To Friedman, it is profit at all costs, to MMT it is social well being at all costs. With MMT, productivity is irrelevant in any analysis no matter what the definition, and to Friedman productivity is irrelevant except as an input cost. Friedman would ratter get rid of all labor as a needless input cost, no matter how productive they were, and MMT would rather have full employment, no matter how low their productivity was.
If you are a student of Business Admin. or have an MBA, then the old definitions are just swept aside. it is how to make money by using money, not on how to make money by making things.
When it means ‘money in your pocket’, the applied meaning takes on an entirely different perspective than when it means ‘marks towards graduation’.
Speaking of definitions, my pet peeve is the use of ‘decimate’ to indicate total or near total annihilation, when at its roots it means ‘one in ten destruction’. I am told that the English Language evolves, and so to the definitions in all fields, including economics, evolve.
Whatever the problems with the old definitions, and they are numerous, they remain the way the national accounts are published in OECD countries.
But so are too the conventions of generally accepted accounting principles for financial accounting.
These are the way our data sources are framed so to do meaningful data analysis and interpretation we have to know them.
Business schools are not immune or exempt from understanding where the data comes from and how it’s constructed. Any good business school in whatever tradition will make sure its students understand that at least.
It’s one thing be such a pedant as to make students switch from conventional and do basic microeconomics with the P and Q axes reversed (as they logically should be), just to correct a deeply embedded error in the history of economic practice - and there are profs out there who do that.
It’s another thing to be insistent on what is actually in a measure that calls itself ‘labour productivity’ and is used by uninformed or deliberately misleading business press in Canada to beat on the labour force itself when the structural issues are completely different.
It would be worth discussing if the business press didn’t constantly misinterpret the meaning of measure.
Not always true. BCs lumber mills were so far ahead of the US mills technologically that it was actually funny.
At least until Harper and Poilievre surrendered to the US lumber lobby.
What has devastated the Canadian lumber industry are the forest fires and the Pine Bark Beetle.
Yeah, no.
Harper and Poilievre fucked over BC when they surrendered to Bush and allowed the raw export of logs to the US.
That, and that alone was the death knell for rural BC. I know this because the market for robotics dropped out in BC once that damned deal was signed. Before that it was a huge industry with a guaranteed great career and benefits. Harper, Pierre Poilievre and the CPC killed it.
So you think that the loss of huge tracts of trees has nothing to do with the decline of lumbering in Canada? The facts and the evidence indicate differently. Politicaldogma, on the other hand, has no respect for facts or the truth.
https://www.cbc.ca/news/canada/british-columbia/british-columbia-forestry-future-pine-beetle-1.6712576
We’ve denuded most of the province of trees before, intentionally. Not a good thing, but it happened.
The problem is that conservative governments(Brian Mulroney, Gordon Campbell and Harper+Poilievre) set it up to allow the export of Raw Logs to the US. Thanks to the latter three, they started it. Thanks to Mulroney, we can’t ever reduce or control the amount of logs exported because of rules in NAFTA/USCMA.
Unfortunately, Canfor, the largest Canadian owned lumber company, has been shutting Canadian mills and moving to the US…
Yeah that’s why I used past tense.
I recall in the mid 2010s some US mill declared how great they were for having a computer analyze the loss and determine the best cuts for optimization.
I toured a mill in BC in the early 1990s that had that technology for more than 5 years.
Yeah, wasn’t trying to detract from your comment bud. Giving extra detail.
Considering lumber was basically Canada’s largest legal export for a very long time, that doesn’t surprise me at all.
‘Farm workers’ are not included in manufacturing, they are in agriculture. Mentioning farm workers makes the rest of your ‘facts’ suspect. In point of fact, the agricultural labor market in America is giving the manufacturing labor market a run for it money, in terms of ‘total wages’.
As the article states, the remaining US industries are primarily automated, requiring fewer employees. Mexico is becoming highly automated, as the American corporate world is building the automated plants in Mecico, not America, and a lot of US manufacturing jobs are leaving for Mexico. The jobs left after automation are usually low-wage ‘floor sweeper/packager’ jobs.
However, all of the manufacturing jobs Trump is trying to get back are all in the low productivity range. He wants to bring back mining jobs, for instance, in an industry that is already highly automated, or steel industry hard labor jobs in mothballed obsolete steel plants that are just not viable anymore. The only way the US will bring back mining jobs is to start digging mines by hand again. On the other hand, most Canadian industries are already highly productive. If they were not, at the Canadian minimum wage they would not be competitive. Most of the Canadian auto industry jobs have gone high automation, just to be competitive. Canadian manufacturing wages are actually higher than American wages. American wages are in the bottom level of income. The Southern ‘right to work’ wage rate is below the poverty level. We pay our auto workers more, but they are far more productive than American workers.
The piece that is missing is that Canada by and large has a population that has obtained a much higher tech education level than the US. Whereas the US just does not have the population sufficiently educated enough to do the jobs required in the remaining high-tech high-productive manufacturing demands, Canada has the educated labor force to actually run these highly automated high production machines.
That is why China is beating the pants off the US when it comes to automation. Not only is China and Asia in general building a highly automated highly productive manufacturing base, they are producing the graduates who can design, build, run, and repair these machines.
Pesky things like labour laws and workers rights, as well as stronger unions, tend to get in the way of important metrics like GDP/hr.
Not really, it’s just that no one invests in Canada. I don’t have a full story as to why, but the data points directly to a low investment rate into technology in Canada. It’s super shitty and I’m sure someone is profiting from the money that would have been invested.
Yeah - as an example. FIL works white collar job in a company with plants in 3 Ontario cities and 1 in Michigan doing CNC milling for huge parts (like oilsands trucks size). His company is unionized on the Caanda factories, and ununionized on the US side. They bought new CNC equipment, and it went to the US factory BECAUSE they can push employees more there. The union forces things like breaks into the schedule regardless of project status while the workers are forced to work through breaks on the US side regularly, or stay after hours to finish.
Thus the US production is better (and they get the equipment to bolster it further), but its directly at the cost of labour rights that the unions have fought for here.
I think, to reiterate, pesky things like regulations limit how much wealth can be extracted from an investment.
That’s, like, the whole Conservative playbook. Deregulate to bring in investors; the people & environment in which we exist are not priorities.
I think it’s also the old hub and spoke model where American companies open shops in Canada to get market access and bypass certain regulatory requirements that apply to international firms. So the Canadian subsidiaries are spokes designed to extract wealth FROM Canadians rather than the “hub” in the US where all the investment money goes.
Same with Canadian companies that are bought by American conglomerates. They usually just become spokes rather than companies meriting innovation investment in their own.
The irony of this is that China is now doing this to the US - America is rapidly becoming a ‘spoke’ in the wheel of the Chinese ‘hub’. For example, General Electric Appliance Division is now owned by a Chinese company Haier, and all GE Appliances built in America are now Chinese models, all profits going back to China. So even if America buys ‘made-in-America’, China still gets richer.