Friday, November 27, 2009

Multiplier Blues!

"Between 1967 and 1982, Chicago lost a quarter million jobs...During the 1970s, 25 percent of all Chicago factories closed...The brutal trend continued. During the decade from 1982 to 1992, manufacturing employment dropped another 18th percent."

Dominic A Pacyga, Chicago: A Biography

Progressives trying to fix the economy or at least think intelligently about such an enterprise have rediscovered manufacturing. It's part of the buzz. It's the wage levels, of course, and the outstanding multiplier effects that derive from manufacturing jobs. To the claim that U.S manufacturing is dead supporters talk windmills.

Manufacturing is not dead. In the 1980s in the face of deindustrialization we had to make this argument in Chicago as high-income commercial and residential uses invaded traditional industrial districts. There were still viable firms and good jobs. Similar arguments have to be made today, in addition to dreams about the green machine.

But I'm afraid manufacturing neighborhoods are gone, for the most part,and won't return. Pacyga traces this saga, not much more than 100-150 years for Chicago, of industrial growth, immigrants, building neighborhoods, fighting for labor and civil rights, spreading the wealth, relocation, deindustrialization and neighborhood decline. The businesses went regional, to the border, across the oceans or simply died. The jobs are gone and so are many working neighborhoods.

Manufacturing jobs and multipliers built a world around them. It was a complex, rich, dynamic, conflict-ridden world that required economic value to grease the wheels and build a middle class. How will we do this in the 21st century?

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