This recovery, though, has been a little different, with employment actually rising faster in goods-producing industries than in services since jobs started to rebound in 2010. Early on that wasn’t a big surprise. The recession that preceded the recovery had been so brutal for employment in construction and manufacturing that some sort of bounce-back was due. But another surge in goods employment followed in 2014 and then, after the “mini-recession” of 2015 and 2016, came an even more impressive one starting in 2017. That’s over now.
According to Friday’s jobs report from the Bureau of Labor Statistics, employment in goods-producing industries was up just 0.8% over the past year, compared with 1.5% in service-producing industries. The annual benchmark revisions that are due next month, which will shave about 500,000 jobs off the totals, will change this picture a little. But my guess based on preliminary data that the BLS released in August is that the revised version will show an even greater outperformance by the goods sector in 2018 and an even sharper correction since.
What are we to make of this? Well, mainly that the goods-jobs boomlet of 2017-2018 was probably more a fluke than a harbinger of the future of the job market, and that hopes that a resurgence of manufacturing, mining and the like would solve many of the problems of the U.S. economy and society are probably misplaced.
Goods-sector jobs are generally good jobs: On average they offer better hourly pay and more hours of work per week than services jobs. A lot of them are also physically demanding and even dangerous, but they provide increasingly rare opportunities for, in particular, men without college educations. Policies that encourage the creation of more of such jobs (infrastructure investment!) can be a great idea. But the overwhelming majority of American jobs will continue to be in services, and improving pay and working conditions in those jobs will benefit far more people than anything that happens in the goods sector. Coal mines aren’t the future we should want — $100,000-a-year manager jobs at Taco Bell are.
The formal names of the goods-producing sectors are manufacturing, construction,mining and logging.
That's based on not-seasonally-adjusted data.
To contact the editor responsible for this story: Stacey Shick at sshick@bloomberg.net
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Justin Fox is a Bloomberg Opinion columnist covering business. He was the editorial director of Harvard Business Review and wrote for Time, Fortune and American Banker. He is the author of “The Myth of the Rational Market.”
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