After WWII, period between 1948 and 1973 brought great prosperity, economic boom and sharp increase in productivity.This period is considered Golden Age of North America, Western Europe, and Japan, writes Marc Levinson, an economist, historian and journalist, in one of his recent article. During this period, Marshal Plan was conceived to rebuild Western Europe and Japan. America’s infrastructure of roads, bridges, schools, universities, factories, heavy equipment for construction and farms equipment got built; and we are profiting from this even today. It brought prosperity and social programs never seen before. It was a period of dream jobs for anyone willing to work. These were kind of jobs with good pay, health insurance, pension, disability, vacation, and sick leave that every blue-collar worker still dreams of. By 1973, growth has achieved the maximum it could muster, and then unfortunately the stagnation started. To achieve further growth new technology was needed, and new technology with automation was brought in to increase the growth. Graph below explains what happened.
As the graph above shows USA manufacturing jobs ( blue line) start to decline in late 1970’s but its overall Manufacturing output ( redline) continue to increase due to new technology and automation. Even though the manufacturing jobs were cut to half by 2010, the overall growth of manufactured goods continue to climb. Graph below shows as robots increased, the manufacturing jobs declined.
Manufacturing jobs in Western Europe and Japan were not doing better either. See two graph below on manufacturing jobs and output. As a percentage of employed population, manufacturing jobs start to decrease even before 1973 but overall goods output continues to increase due to automation.
Despite losing manufacturing jobs, USA was still the largest producer of manufactured goods until recently, when China took over as the largest manufacturer of goods mainly because of population advantage. But USA is expected to take lead again, per Industry Week Magazine, by 2020 due to automation technology. Moving of manufacturing jobs to other countries had only marginal impact on total manufactured goods in USA.
Economist, Marc Levinson, further argues that Golden Age ended in 1973 and cannot be repeated. Even Elon Musk and Bill Gates are not optimistic and are suggesting some social programs to help significant portion of population that will be permanently underemployed or unemployed due to automation technology. Elon Musk supports Universal Basic Income (UBI) for every one given by government and Bill Gates recently suggested to tax Robots like humans on the income they produce.
Many blue collars workers voted for Trump with the hope that he will bring back Golden Age period. It is the same nostalgia that some Muslims have for their Golden Age period, which is not coming back either-as human’s fierce ambition to progress and move forward does not care who gets trampled in the way.
Fayyaz Sheikh