"Former Treasury Secretary Larry Summers said Ford CEO Jim Farley's idea of the "essential economy" is a good concept as it doesn't focus narrowly on just factory work. Amid fears that AI will wipe out large swaths of white-collar work, Farley has highlighted shortages in blue-collar professions, putting the unmet need at about 1 million jobs, as many American schools, families and policymakers have neglected the essential economy."
"By the end of 2024, that share was just 8% as the U.S. shifted to more service-oriented growth, while productivity gains, automation and globalization cut the number of domestic factory workers over the decades. Those job losses devastated regional economies, creating a political backlash that helped send Donald Trump to the White House and launch a trade war, designed in part to bring more production back to the U.S."
The "essential economy" concept emphasizes jobs beyond traditional manufacturing, including repair, maintenance, transport and other blue-collar roles. Shortages in blue-collar professions amount to roughly one million unmet positions as schools, families and policymakers have underemphasized these pathways. Manufacturing employment peaked at 38.9% in 1943 and fell to about 8% by the end of 2024 as the U.S. shifted to service-oriented growth, while productivity gains, automation and globalization reduced domestic factory jobs. Those losses harmed regional economies, contributed to political backlash and trade tensions aimed at reshoring production. Rapid expansion of tech and higher education drew workers to white-collar roles now threatened by AI.
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