FIGURE 14-1 Number of production workers employed by the U.S. manufacturing sector, 1947 to 2002. SOURCE: Department of Labor.

productive manufacturing workers in the world, and the wages that they earn.

This gap is one of the labor movement’s most serious concerns, along with maintaining production. Workers in the manufacturing sector earn on average $24.30 per hour, in comparison with $22.06 per hour for workers in non-manufacturing sectors and $19.74 for workers in the service sectors.¹ Within manufacturing jobs, there is a considerable advantage to being in a union, because both wages and benefits are higher for workers represented by a union.² Unfortunately, there is a declining union density and varying amounts of union representation in most industrial sectors.³ This declining power of worker representatives in manufacturing has caused the gap to open up between compensation and productivity. In addition, over the past decade there have been significant changes in production workers across industries (Figure 14-3).

The current recession is not like any previous postwar recession. It was not caused by the Federal Reserve Board acting to stamp out inflation. Rather, this recession was caused by a decrease in business spending, especially in manufacturing, following an overinvestment in manufacturing during the 1990s. The decline in production during this recession caused capacity utilization to dive from 81.7 percent in June 2000 to 72.9 percent in December 2001 (Figure 14-4). Between March 2001 and December 2002, manufacturing employment dropped from 12.3 million to 11 million. This decrease of 1.3 million production workers represents over 90 percent of all jobs lost during this recession. The recession is therefore a manufacturing-driven phenomenon. The decrease in business spending in the manufacturing sector has brought the entire economy into a recession and has created a short-term crisis in the