A manufacturing downturn could still hurt the U.S. economy, but not trigger a recession as in the past

“Early in the post-war era, cracks like that in the manufacturing sector usually would have widened to encompass the broader U.S. economy” writes Elisabeth Buchwald for Towards the end of the 1970s, the share of manufacturing jobs still topped 20%, when some 19.5 million Americans were employed in auto plants, steel factories and the like.From the 1950s through the 1970s, the manufacturing sector was the ship propelling the U.S. economy, but that ship has sailed which means the recent slowdown in factory activity is unlikely by itself to trigger a recession.There’s no question the U.S. would be better positioned if business spending in the manufacturing sector was still expanding rather than contracting, but the sector is not what’s spearheading the economy anymore.At the time, manufacturing accounted for one-third of non-farm jobs, Bureau of Labor Statistics figure show.

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