This chart is almost worthless as a measure of US Manufacturing capacity or production. Why? Because sizable orders to a handful of companies (eg. Boeing, GE, Lockheed, etc.) offsets and distorts the disappearance of thousands of medium and small manufacturers over the past two decades. Its tempting to attribute the associated job losses to automation, but one look at this table: https://en.wikipedia.org/wiki/List_of_largest_manufacturing_... and its clear millions of similar jobs have shifted overseas.
True, millions of similar jobs are created overseas, but that's when salaries are so cheap that automation is more expensive than just manual labor. As wages go up, automation makes more sense in manufacturing, and job losses happen to those countries too.
When looking at developing countries that are actually developing (instead of stuck in the middle income trap) what we see is a picture of a more developed country decades ago, except with access to modern tech. While the modern tech makes them move faster, you should expect them to be more like the US or the EU every year. Look at pollution: China has a huge pollution problem, but that's not unlike LA in the 70s and 80s. People are getting wealthy enough to demand environmental regulations, and in a decade their government will care about environmentalism.
So instead of thinking about how China or India have things that we've lost and try to turn back the clock, it's more productive to think that we have to deal with our own problems today, as China will also have them in 20 years.
How is it a distortion to count output from large companies? If a handful of giants make up a large portion of American manufacturing and have sustained total production, then American manufacturing production hasn't decreased.
Of course manufacturing jobs have shifted overseas; I can't imagine anyone disputing that. I'm not sure what that table means in this context, though. Replacement of smaller manufacturers with larger conglomerates is indeed a major driver of the shrink in jobs, and I don't see where I mentioned automation.
I agree it is worthless, but for a different reason. All manufacturing isn't created equal. The US growth in manufacturing is largely driven by increased oil production. That isn't the manufacturing we want to have. It is not great for jobs, not great for the environment, and it isn't sustainable.
That's a dramatic exaggeration. It's at a low post 1960s (an era which produced a temporary fake high because the rest of the developed world had been blown up, so the US took over half of all global manufacturing, a boon for working-class wages).
Go take a look at what labor pulled in per hour in 1890.
