Greater emphasis should be placed on the employment creation role of the service sector

Since the beginning of the 21st century, with the rapid development of the global service economy, almost all new jobs in most developed economies have come from the service industry. Research shows that as DS200DCFBG1BJB economies grow and technology advances, manufacturing and services increasingly show distinct patterns of job creation. Manufacturing can be competitive by employing labor-reducing production technologies and processes, but services rely on labor that is difficult to replace with machines or equipment. As a result, technological advances in manufacturing will further reduce labor demand, and growth in services is more likely to lead to new jobs. Moreover, since the quality of the service labor force will be directly transformed into the quality of service output, the progress of the service industry is more conducive to the role of the labor force with higher education, and the development of the service industry can become an important direction to solve the employment of college students.

First, factors such as labor productivity and technological DS200DCFBG1BJB innovation will inevitably lead to the reduction of manufacturing jobs. Manufacturing is more productive than other industries, which explains the gradual decline in US manufacturing employment since its peak in 1979. Since manufacturing is increasingly capital-intensive, it is increasingly unlikely that an increase in manufacturing activity will translate into an increase in manufacturing employment. A 2019 study by the US Congress showed that because its manufacturing sector uses $325,000 in fixed assets per capita, even large investments are likely to generate relatively few manufacturing jobs. The study of South Korea also showed that in 2000, a 1% increase in manufacturing in South Korea led to a 0.1% loss of jobs, while the same increase in services led to a 0.66% increase in employment. In other words, if the economy depends on manufacturing for future growth, unemployment growth is inevitable. To create more jobs, we must develop the service sector.

Second, production is no longer the mainstay of manufacturing jobs. In 2017, more than 33 percent of workers in German manufacturing were in service jobs. According to the Bureau of Labor Statistics, 32% of manufacturing workers in the United States were in managerial and professional jobs in 2018. Blue-collar occupations such as transportation and material handling, maintenance and repair, cleaning, food services, and protection services account for two-thirds of manufacturing employment; In many manufacturing industries, the proportion of jobs requiring higher skills is high. Automation has reduced total employment in computer and electronics manufacturing in the United States, with about 21 percent of people in the industry working in architecture and engineering and 13 percent in computer and math, jobs that require a high level of education.

Third, the service industry plays an DS200DCFBG1BJB important role in the reemployment of workers in the manufacturing industry, and the inter-departmental job transition of workers does not have a significant impact on income and career development. Research shows that the loss of jobs in manufacturing companies, industries or sectors does not mean the loss of jobs in the entire economic system, jobs with the same job description will appear in the service sector, and manufacturing jobs that disappeared from manufacturing will reappear in large numbers in the service sector. Until now, this possibility of moving jobs between industries and sectors without significant friction has been largely ignored by researchers, with manufacturing and services always viewed as two separate Labour markets. Research shows that the decline in manufacturing employment in Germany has been much smaller DS200DCFBG1BJB when measured by workers’ occupations, with services increasingly becoming an alternative employment option for manufacturing workers. Between 1975 and 2017, the number of manufacturing jobs in the German manufacturing industry decreased by about 1.6 million, while the number of manufacturing jobs in the service industry increased by more than 800,000 during the same period, and about 52% of the production jobs lost in the manufacturing industry were offset by new manufacturing jobs in the service industry. Workers can perform the same tasks in manufacturing and service industries – driving trucks, working as office clerks, or even making hard drives in any industry. In 2017, the number of people working in manufacturing in Germany was only 1.3 times the number working in the service sector, where manufacturing workers are increasingly finding jobs. In 1975, services employed 26 percent of manufacturing workers in Germany; by 2017, that share had grown to 42 percent, and the trend has continued. Long-term observations show that workers who move to services but retain their initial occupations after mass layoffs experience a similar employment trajectory as workers who remain in manufacturing, suggesting that occupation-specific human capital is more important to workers than industry-specific effects.