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**JUNE 24, 2021**

Meyerson on TAP

Why a Factory Job Ain't What It Used to Be

Wednesday's Wall Street Journal ran a story

that reported on an inversion of what had been a venerable truth about
the American economy. That truth had been that a manufacturing job-at
least, a manufacturing job in durable-goods industries like auto,
appliances, and steel, though not clothing or textiles, with their
predominantly female workforces-paid more than a job as a waitress or
sales clerk.

Now, another venerable truth has either bit the dust or is approaching
it. A decade ago, a factory job paid 83 percent more than a hotel or
restaurant job, the

**Journal**tells us. Today, that margin has been reduced to 56 percent.
Similarly, the pay advantage of manufacturing over retail has slumped
from 40 percent to 27 percent.

Manufacturing is subject to low-wage global competition, of course, in
ways that the retail and hospitality sectors are not. But that's
hardly the only factor behind this topsy-turvy inversion. For one thing,
the huge wholesale-buying-and-retail-selling power of Walmart forced
U.S. manufacturers to slash their wages if they wanted their goods on
Walmart's shelves. For another, as I noted in the

**Prospect**in 2015
,
it's the American South, just as much if not more than China, that has
been setting the nation's descending wage standards in recent decades.
It's the non-union South where manufacturing jobs have increased in
recent decades, as I documented: "Between 1980 and 2013 ... the number
of auto industry jobs in the Midwest fell by 33 percent, while those in
the South increased by 52 percent. Alabama saw a rise in manufacturing
jobs of 196 percent, South Carolina of 121 percent, and Tennessee of 103
percent; while Ohio saw a decline of 36 percent, Wisconsin of 43
percent, and Michigan of 49 percent."

Alabama, South Carolina, and Tennessee, by the way, are three of the
five states (along with Mississippi and Louisiana) that have never
passed minimum-wage laws.

In fact, when European companies have opened factories in the American
South, it's actually because they've found it cheaper than China. As
the chief staff member to a director of the European aerospace giant
Airbus told me, while the high-value work is done for high wages in
Germany, "given the 6-to-1 productivity advantage that the United
States has over China, it's cheaper to do the final assembly in the
U.S."

Lest their states lag behind this race to the bottom, a number of
Republican governors and legislators in the industrial Midwest have
weakened the capacity of their workers to stand athwart this downward
slide. Scott Walker's Wisconsin, as well as Republican administrations
in Indiana and Michigan, enacted right-to-work laws that had previously
been confined to the South and Mountain West.

So it's not just global capitalism that has sent factory wages
spiraling downward. It's the low-wage, originally no-wage American
South that has diminished the nation's once decently paid working
class, and the Republican Party that has brought those Southern
standards north.

~ HAROLD MEYERSON

Follow Harold Meyerson on Twitter

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