While Donald Trump’s victory seemed to be a triumph for blue collar workers, it is likely that they have only won a battle in a war they will inevitably lose. The key to Trump’s victory was flipping the Rust Belt states, but if President-elect Trump is concerned about the long-term welfare of these workers, the best solution would be to help them find new jobs by expanding their employment options by de-licensing the job market.
There is no doubt that manufacturing jobs are disappearing. While 24 percent of Americans worked in manufacturing in the 1960s, today that number is roughly 8 percent. The remaining factories are becoming increasingly automated, substituting machines for human labor. Trump and his voters see this as a problem. Yet what they need to realize is that manufacturing jobs will never come back to the United States.
Many of these industries are no longer competitive in the United States given our standard of living. In the auto industry, for instance, a factory can hire nearly six Mexican workers for the price of one American worker. That number does not consider the fact that government subsidies are often used to incentivize these factories. For example, Tennessee offered Volkswagen multiple subsidies since 2008, costing federal, state, and local governments a combined amount of over $200,000 per job.
A subsidy-driven job market is not a sustainable solution. While the manufacturing job market may be preserved or even expanded in the short term, this is done artificially at an enormous cost to American taxpayers. While not all subsidies are as generous as the one in Tennessee, many of these incentive packages subsidize the industry along with the worker, thus adding to the overall cost. Economically speaking, if Americans truly cared about blue-collar workers, we could more easily have paid for them to do nothing and sent these industries overseas.
In addition, holding on to these jobs will continue to grow more expensive every year. As factory equipment becomes more advanced and reduces in price, the subsidies would have to become more pronounced to warrant the use of human labor. These workers will only continue to grow as a burden on their fellow Americans.
Further, manufacturing wages are not only high compared to foreign wages, but low when compared to domestic wages. According to the Bureau of Labor Statistics, manufacturing workers have a 7.7 percent lower median wage than the median wage of all American workers. Moreover, these wages have continued to decline since 2007 and are projected to continue doing so. This means that the jobs we are so desperately trying to save actually put the workers in a worse place than the average American.
Rather than pour money into subsidies or put up trade barriers, President-elect Trump should be helping blue-collar workers transition into new jobs. One easy method is to cut down on federal occupational licensing and encourage states to do the same. Licensing laws significantly restrict the job opportunities of blue-collar workers, making their transition out of the manufacturing industry significantly harder. Expanding their choices on the job market increases the chance that these workers will find new and better careers.
While justifiable for professions like doctors and lawyers, occupational licenses are now required for simpler professions such as truck drivers and hair stylists as well. As opposed to less than 5 percent of jobs in the early 1950s requiring a license, nearly a quarter of workers need licenses in 2015. The cost of obtaining these licenses is extremely prohibitive and prevents blue collar workers from looking outside of the manufacturing industry for work. For example, in Nevada, acquiring a barber’s license requires 890 days of education and training. Expecting the blue-collar worker to choose unemployment for two-and-a half years while training for their license is unreasonable, and is a key factor in deterring these workers from finding new jobs.
American blue-collar industries are dying, but the same does not have to be said about the workers themselves. If President-elect Trump really cares about the future of these workers, he should end the laws that are chaining them to these dying industries and help them find new jobs in changing job market.
Andy Yuan is a Washington, D.C., based freelance writer who graduated from the University of California, Berkeley with a B.A. in Legal Studies