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Could Biden’s Plans Create More American Factory Jobs?

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Washington (AFP) – President Joe Biden will try to reach out to blue-collar workers Wednesday when he travels to a truck factory in Pennsylvania to support for government investments and clean energy as ways to boost US manufacturing.

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The president will tour the Lehigh Valley Operations Facility for Mack Trucks, a chance to network with the factory’s 2,500 workers, most of whom are unions. Biden has made manufacturing jobs a priority, and the political coming of Democrats next year may depend on whether he succeeds in revitalizing a sector that has steadily lost jobs for more than four decades.

The administration supports a $973 billion infrastructure package, $52 billion for computer chip production, sweeping investments in clean energy, and the use of government procurement contracts to create factory jobs. Biden will be briefed on Mack’s electric garbage trucks on Wednesday.

“This is all part of his effort to advance and talk about his agenda to purchase American products as well as the infrastructure package,” White House Press Secretary Jen Psaki said Tuesday in a preview of the visit.

The president won Lehigh County in the 2020 election, but he faces the perennial challenge of previous administrations to revive the manufacturing sector at the heart of American identity. Failure to restore manufacturing jobs could hurt already ailing factory cities across the country and potentially jeopardize Democrats’ chances in the 2022 midterm elections.

Pennsylvania Mon. Pat Toomey, a Republican, said Biden should pull unspent money from the $1.9 trillion coronavirus relief package to cover infrastructure investments, rather than relying on tax increases and other revenue-raisings to do so.

“We hope he uses his visit to learn about Pennsylvania’s real physical infrastructure needs — and the vast amounts of unused ‘COVID’ money that must be paid for that infrastructure,” Tommy said in a statement.

Declining industrialization has been a thorny problem for Democrats looking for voters during elections.

White factory layoffs have prompted communities to vote for Republican rivals and turn against Democratic incumbents, according to a 2021 research paper by Leonardo Pacini of McGill University and Stephen Weymouth of Georgetown University. They found a link between deindustrialization and an increase in racial division as white voters interpreted demobilization as a loss of social standing.

Areas that have seen factory layoffs are also becoming more pessimistic about the economy as a whole. The trends documented in the research were most apparent in 2016, when Donald Trump won the White House emphasizing blue-collar identity and racial differences.

One challenge for Democrats is that they don’t have to deal with the latest manufacturing job losses, but the layoffs that began decades ago.

“Biden will benefit from the improved manufacturing jobs outlook,” Weymouth said. But many economists believe that many of these jobs are gone forever. Thus, it is an uphill battle. There are alternatives: the president could seek a more significant social safety net for people who have lost their jobs or investments in these communities that have been in decline for decades.”

Manufacturing has been improving since the depths of more than a year ago during the recession caused by the pandemic. Labor Department data shows factories have restored about two-thirds of manufacturing jobs that lost 1.4 million jobs due to the outbreak. Factory production as tracked by the Fed is just below pre-pandemic levels.

But the manufacturing sector – especially the automotive sector – faces grave challenges.

Automakers are limited by the global shortage of computer chips. Without the chips required for a modern vehicle, production of cars and trucks fell from an annual pace of 10.79 million at the end of final year to 8.91 million in June, down nearly 18% as measured by the Federal Reserve. Analysts at IHS Market estimate that semiconductor supply will only stabilize and recover in the second half of 2022, just as the mid-term races become more intense.

The impact of chip shortages could stream through the rest of the economy. Used car prices are up 45.2% compared to final year, due to not enough newly built cars and trucks available. The administration has been proactive in trying to address the problem, calling for a bill designed to increase semiconductor production in the United States in ways that would also aid other manufacturing sectors.

“I’m engaged almost daily with the industry,” Commerce Secretary Gina Raimondo said final week at a White House news conference. “We need to incentivize chip manufacturing in America. And so, we are very focused on putting the pieces in place so that can happen.”

Over the former several decades, presidents have vowed to restore factory jobs without much success. Industrial employment peaked in 1979 at nearly 19.6 million jobs, only to slip down with sharp declines following the 2001 recession and the 2007-2009 Great Recession. The number now stands at 12.3 million.

Bill Clinton, George W. Bush, Barack Obama and Trump all said their policies would preserve manufacturing jobs, yet none of them broke the lengthy-term trend in a enduring way.


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