Valued at nearly $20 trillion, the U.S. economy is the largest in the world. Maintaining a competitive edge necessitates remaining diversified and dynamic. While this means that some U.S. industries thrive, others inevitably decline or are rendered obsolete.
As certain industries fade, so do hundreds of thousands of American jobs. 24/7 Wall St. analyzed employment figures from 2006 to 2015 from the Bureau of Labor Statistics to determine the 25 fastest dying industries. Employment in each industry on this list declined by at least 43%, and in the top two by at least 80%.
At least one of three broad factors is behind the decline in each of the fastest dying industries. The first factor is cost reduction. Cheaper labor abroad has caused many American companies to outsource manufacturing operations. In China, for example, the minimum monthly wage in the garment industry is less than $150 a month. Perhaps not surprisingly, the bulk of clothing Americans import was made in China.
In addition to outsourcing, robotic automation in U.S. factories have hurt employment in manufacturing. The sector has shed nearly 2 million jobs in the past decade, a 12.8% decline. Of the 25 fastest dying industries, 10 are in the manufacturing sector, and seven of those are related to clothing and other textiles.
The second cause for massive employment declines in certain industries is the wide adoption and exponential growth of new technologies. Online streaming services and on-demand programming are largely responsible for the 61% employment decline in DVD and video tape manufacturing and the 89% decline in the video rental industry. Similarly, the proliferation of cellphones and smartphones has greatly reduced employment in both telephone manufacturing and photofinishing, industries where employment has declined by 51% and 60%, respectively.
Finally, broad macroeconomic conditions have also contributed to lower employment in many industries. Most notably, within the last 10 years, the subprime mortgage crisis and resulting recession have contributed to a considerable drag on construction. Since 2006, new home construction has declined by 51%. Over the same time period, the broad construction sector has shed over a million jobs, or 15.3% of total employment. The land subdivision and framing industries were hit especially hard, with employment declining by 57% and 55%, respectively.
To identify the dying industries, 24/7 Wall St. reviewed employment growth from 2006 through last year for 704 U.S. industries in the fourth level of detail in The North American Industry Classification System (NAICS) by the U.S. Census Bureau. All data, including the number of establishments within each industry, average weekly and annual wages, as well as breakouts of these data over government, private, and local levels were retrieved from the U.S. Bureau of Labor Statistics’ (BLS) Quarterly Census of Employment and Wages (QCEW). The BLS tracks industry employment by tallying the number of workers in establishments whose primary sources of revenue fall within a given industry. As a result, a given establishment along with all of its employees may be reclassified depending on business decisions and market performance. For the finance and insurance industry, where the primary source of revenue for a fund, trust, or financial vehicle can change from a single trading decision, industry employee counts may not be comparable from one year to the next. To help ensure that 10-year employment changes reflected natural growth, all industries related to the management of funds, trusts, and other financial vehicles were excluded.
This is not the kind of data Donald Trump wants to see. He, along with millions of people who have lost their jobs, does not want to face the realities of a world economy. Instead of working to retain outdated technologies the US government should be spending its time training the population in technologies of the 21st century. We have the money to change but we lack the will.