"jim rozen" wrote in message
...
In article , Ed Huntress
says...

Oh, I should have completed that idea: No matter what the breakdown is,
it's
clear that you create more service jobs by manufacturing a product and
selling it in the same country, than you do by importing the same
product.
If you both manufacture and sell, you add both types of service jobs to
the
equation.

So there is some multiplicative factor involved. Say it's between
one and four. Someplace in there. So the 8% bump in unemployement
really is going to be bigger than that. By at least a factor of
two.

I wish it were that simple, but it's not. For example, manufacturing people
often say that manufacturing creates service jobs, and that's certainly
true. When you build a plant, you need plant maintenance, and accounting
services, communications and transportation, and so on.

But we seldom hear the other side, which also is true. That is, service jobs
create a demand for manufactured goods. If you start a landscaping service,
you need mowers and backhoes and shovels.

My own view is that services and manufacturing are symbiotic, in one of the
few legitimate applications of that word. They grow together. Separating the
two, in terms of which stimulates the economy more, probably is an
impossible task.

What you're saying about a decline in one type of job decreasing demand for
another type, however, is clearly true. When services decline, manufacturing
is likely to decline, and vice-versa. And a net decline in manufacturing,
even if the goods not produced are fully replaced by imports, is going to
cause a net decline in demand for services in the importing country.

The big question is whether the economy is growing enough and evolving
enough to replace those lost jobs with new types of jobs and new types of
economic activity in general. It's hard to get a handle on this because we
have little unequivocal experience with it under our present economic
realities. The '90s bubble distorts it, and the recession of the last few
years distorts it the other way. There appears to be no way to normalize for
these ups and downs, so you can see the underlying dynamic. In fact, the ups
and downs *are* an important part of the overall dynamic.

Economics, anyone? g

--
Ed Huntress
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