Between 1980 and 2009 the United States lost 7.1 million manufacturing jobs, about 38 percent of its manufacturing base. It lost most (two-thirds) of these jobs between 1980 and 2005, prior to the Great Recession. More than 61 percent of these lost jobs were in 114 indus­trial metropolitan areas—metropolitan areas that strongly specialized in manufacturing in 1980. This report examines the ways in which the industrial composition of those areas changed dur­ing the 1980–2005 period and the consequences that those changes have had for wage and employ­ment levels in those areas.

Although scholars, policymakers, and journalists have extensively analyzed and debated the causes of deindustrialization and its consequences for displaced workers, they have paid much less attention to the kinds of jobs that have replaced lost manufacturing jobs and to the consequences that industrial shifts have had for metropolitan areas. As a result, assertions about these phenomena have abounded. Some of these have been supported with evidence while others have been backed up only with theory or have simply been asserted without support.

An analysis of employment and wage data for 114 metropolitan areas that specialized in manu­facturing in 1980 and lost manufacturing jobs from 1980 to 2005 finds that:

Two-thirds (76) of the 114 metropolitan areas, mostly in the Midwest, performed worse than the nation as a whole in both job growth and average wage growth from 1980–2005. Only three (Charlotte, Manchester, and Portland, ME) performed better than the national aver­age on both. In general, metropolitan areas in the Northeast had slow job growth but relatively rapid wage growth, those in the South had rapid job growth but slow wage growth, and those in the Midwest had slow growth of both jobs and wages.

The metropolitan areas that lost the fewest manufacturing jobs gained the most non-manufacturing and advanced service jobs. Regardless of whether there is a cause-and-effect relationship between manufacturing and non-manufacturing jobs, the two are complementary rather than competitive.

Between 1980 and 2005, the 114 metropolitan areas typically had faster growth in transportation and warehousing and slower growth in advanced services, tourism, and government than the nation as a whole. The shift of employment toward transportation and warehousing accords with popular perceptions of employment change in these metropolitan areas, although it is uncertain whether that shift contributed to job or wage growth.

Of the 114 metropolitan areas, the typical region’s 1980–2005 job growth rate was 12.8 percentage points lower than it would have been if all its industries had grown at their respective national rates. The sluggish job growth in many of the 114 metropolitan areas, including those that specialized in autos and auto parts, was due more to slow job growth within the areas’ existing industries than to their specialization in industries that grew slowly throughout the nation.

Of the 114 metropolitan areas, the typical region’s 2005 average wage was 6.1 percent lower than it would have been if its industry composition had not changed since 1980. In the typical metropolitan area, employment in low-wage industries grew by 42.5 percent from 1980–2005, while employment in high-wage industries increased by only 11.7 percent. Because of changes in the industrial composition of employment, including the loss of manufacturing jobs, wages in most of the 114 metropolitan areas were lower than they would otherwise have been, but these wage-lowering industry shifts were similar to those that occurred nationwide.

The inflation-adjusted average wage grew by 16.9 percent between 1980 and 2005 in the 38 metropolitan areas that were most industrially diverse in 1980 but by only 9.5 per­cent in the 38 that were least industrially diverse. However, there was no difference in job growth between the most and least industrially diverse metropolitan areas.

The findings hold implications for economic development policy in deindustrialized metropolitan areas. By allowing us to examine and analyze common conceptions of American manufacturing, the findings reveal a solid baseline for economic development policymakers.

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This report shows how three metropolitan areas—Portland (OR), Kansas City, and Boise—became centers of high technology industry without the presence of a major university. For each metropolitan area it describes the history of high-tech development, current status of high-tech industry clusters, and the roles that public policy and higher education played in spurring the growth of high-tech industry. In the three metropolitan areas high-tech industry is very specialized, anchor firms and new business startups helped it develop, high-tech industry predated supportive public policies, and local universities that were not major research institutions helped support high-tech growth after high-tech industry was already established. The evidence on high-tech development in the three metropolitan areas offers important information for policymakers and practitioners interested in technology-based economic development outside of large, well-established high tech centers.

Introduction

Technology-based economic development has spread beyond Silicon Valley and Boston’s Route 128 corridor. These two pioneering high-technology centers have long captured the attention of policymakers and analysts with many wondering what it would take to become “the next Silicon Valley.” So far, efforts to imitate Silicon Valley have had a dismal track record. In recent years, however, other metropolitan areas have gained momentum and are emerging as high-technology locations. Understanding the dynamics of growth in emerging high-technology centers is important because emerging centers may offer more realistic scenarios for developing high-tech economies in metropolitan areas than Silicon Valley or Boston would. As our metropolitan economies become more knowledge-based, innovation-driven, and service-oriented, it is important to understand how high-technology industries developed beyond Silicon Valley and Boston.

This report shows how three metropolitan areas—Portland (Oregon), Kansas City, and Boise—emerged as second-tier high-tech centers even though they did not host a major research university, which is often thought necessary for high-tech development. These metropolitan areas host significant concentrations of high-technology industry activity. Relative to their size and location, they are highly innovative and entrepreneurial. Technology companies in these emerging high-technology metropolitan areas have grown by building on existing corporate assets. State and local policymakers in these metropolitan areas are developing unique policies to link universities with industry, facilitate entrepreneurship, and support the development and commercialization of innovation.

Portland, Kansas City and Boise are different from such large, well-known high-technology centers as San Francisco-San Jose (Silicon Valley) and Boston. They are smaller and somewhat less specialized in high technology industries. They do not attract large amounts of venture capital. Their businesses spend less on research and development than do those in San San Jose and Boston. They do not have world class research universities. However, Portland and Boise are about as inventive as Boston, as measured by rates of patenting activity.
 
All three of the emerging high-tech centers profiled in this report are home to innovative entrepreneurs
and sometimes branch operations of well-known firms. Intel, for example, opened its first branch manufacturing facility in Portland in 1976 and has since then expanded it into a state-of-the-art manufacturing process development facility for semiconductor production. Consequently most of Intel’s innovations are “made in Oregon.” During the 1990s, for example, the majority of patents were assigned to Oregon-based inventors. Hewlett-Packard relocated its printer division to Boise in 1973. Its trademark product, the laser printer, was developed in Idaho, not in Silicon Valley. Kansas City is an example of a highly specialized second-tier life sciences center. The City metropolitan area has a significant cluster of contract research organizations and it is home to the leading firms in the animal
health industry. Those firms, combined, capture 30 percent of the world’s animal health market.

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This report investigates the accessibility of middle-wage jobs—good-paying jobs for less-educated workers—for those without bachelor’s degrees in 204 metropolitan areas. It measures “accessibility” as the share of jobs that are middle-wage as a percentage of the share of workers without a bachelor’s degree. The higher this percentage, the more accessible middle-wage jobs are. Using American Community Survey and Bureau of Labor Statistics data for 2005, it finds that:

Many middle-wage jobs are in clerical, construction, and production occupations. The largest middle-wage occupations in metropolitan America are customer service representatives; bookkeeping, accounting, and auditing clerks; and secretaries. Other sizable middle-wage occupations include carpenters, laborers, industrial truck and tractor operators, and team assemblers.

Middle-wage job accessibility is at least 65 percent in the 15 metropolitan areas where those jobs are most accessible to less-educated workers, well above the average of 52 percent for all metropolitan areas in this report. The metropolitan areas where middle-wage jobs are most accessible include Elkhart, IN; Hickory, NC, and Las Vegas, NV. In the 15 metropolitan areas where middle-wage jobs are least accessible, including Boulder, CO; San Jose, NV; and Trenton, NJ, accessibility is 44 percent or less. (These rankings have almost certainly shifted due to concentrated sectoral declines in many industries during the current recession; e.g. furniture manufacture in Hickory, NC and RV production in Elkhart, IN.)

Middle-wage jobs are slightly more accessible to less-educated workers in small and medium-sized metropolitan areas, and metropolitan areas in the South. Middle-wage job accessibility is 55 percent in metropolitan areas with fewer than 1 million people, compared with 51 percent in those with 1 million or more people. It is 55 percent in Southern metropolitan areas but only 50 percent in metropolitan areas in the Northeast and West.

Less-educated workers enjoy above-average access to middle-wage jobs in metropolitan areas that specialize in leisure and hospitality and manufacturing industries. Middle-wage job accessibility is 59 percent in metropolitan areas that specialize in leisure and hospitality industries and 54 percent in metropolitan areas that specialize in manufacturing. In contrast, accessibility is only 48 percent in metropolitan areas that specialize in high-tech industries.

Despite the economic downturn, middle-wage jobs remain a prominent feature of the labor market in metropolitan areas nationwide. Yet policymakers can do more to tailor economic and workforce development strategies to expand the number of middle-wage jobs in metropolitan areas to better match the number of middle-wage jobseekers. They can also strengthen policies that help more working adults earn four-year college degrees, thereby enhancing their earning power while reducing competition for middle-wage jobs. The type of analysis provided in this report can help economic and workforce developers and policymakers better align middle-wage jobs and middle-wage jobseekers in their metropolitan economies.

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Chrysler and General Motors have now presented their recovery plans to Washington. The plans, like the public debate about the future of the industry, focus mainly on short-term issues such as financial restructuring.

However, it is crucial that the automakers and the government also address the underlying impediments to their long-term viability.

During the grilling the automakers received on Capitol Hill in November and December, commentators on both the right and the left misdiagnosed these impediments.

To some on the right, the Detroit firms’ biggest problem is labor costs. But these labor costs are less than 10 percent of vehicle cost. In any case, the companies and the United Autoworkers Union are already addressing retiree health care and pension costs, the major source of the labor cost difference between the Detroit Three and Japanese manufacturers.

Some on the left assert that the major problem is the firms’ failure to make fuel-efficient cars. During the long era of cheap gasoline, though, it was wrong to blame the companies for making the SUVs consumers desired.

Instead, the Detroit automakers’ long-term problems lie in two areas that have rarely entered the public debate: uneven product quality and lagging innovation.

Although their defect rates are now similar to those of Japanese models, Detroit Three cars still lag in other dimensions of quality, such as quality of ride, cabin noise, vibration, and harshness. Reflecting these deficiencies (plus lagging consumer perceptions), the average Detroit Three car sells for $2000-$3000 less than a Japanese car in the same size class.

Simply put, Detroit has a price problem, not a cost problem.

More consistent quality, achievable by reducing costly and unnecessary steps in production and design, would make consumers willing to pay more for Detroit’s cars.

In the area of innovation, the Detroit Three were latecomers to hybrids and continue to lag in developing the next generation of alternative-powered cars. If market forces, public policy, or both create long-term upward pressure on the price of gasoline, then the companies that are ready to bring those cars to market soonest will be positioned to be the industry leaders.

If federal government assistance to the auto manufacturers is to ensure long-term viability, it must address these issues.

For the quality problem, the federal government should create a manufacturing assistance program dedicated to helping aid-receiving automakers implement world-class manufacturing and design practices in all their operations. Those practices involve using knowledge from a variety of sources—including production workers and suppliers—to eliminate waste and increase quality. Japanese companies have used them for decades.

The administration’s auto industry task force should understand those practices and staff up to implement them. Automakers receiving federal loans should be required to accept the new program’s recommendations, working with suppliers to ensure the quality of auto parts and with the UAW to ensure that workers’ knowledge is tapped. For example, automakers would be required to develop with suppliers and workers action plans to address the top 10 warranty concerns in each plant. Measurable performance improvements would be required to continue receiving taxpayer funds.

To spur innovation, the federal government should offer automakers funding to form a precompetitive research consortium to identify and resolve the short- and medium-term technological obstacles to the development of viable alternative-powered cars. The consortium should be open to all interested automakers, suppliers, universities, and research labs.

Federal funding for the consortium should be conditioned on participating firms submitting a credible research plan that includes specific outcomes that can reasonably be expected to result from the research.

The auto task force should assemble a team of experts who, in conjunction with industry and academic advisors, would suggest improvements in the plan. Consortium members should be required to respond to these suggestions and to contribute financially to program costs. Funding should initially be for three years, with renewals in three-year increments subject to demonstrated progress toward the consortium’s goals.

Finally, to ensure a market for these alternative-powered cars—and thereby give automakers an incentive to make the consortium’s research a top priority—the federal government should phase in an increase in the federal gasoline tax. To offset the tax’s impact on low- and moderate-income Americans, other taxes paid by these households should be reduced and the earned income tax credit increased.

Putting the U.S. auto industry on the high road to recovery will require more than a quick financial fix. It will require sustained cooperation between government and the industry around fundamental issues: what kinds of cars are made and how they are made.

      

 

 

Executive Summary

In recent years many municipalities and counties throughout the nation have enacted living wage laws, which require businesses that benefit from government contracts or other forms of public financial assistance to pay wages well above the federal minimum wage, and sometimes benefits, to their workers. Advocates of these laws often view them as ways to raise the earnings of low-wage workers and reduce wage inequality. Opponents often believe that the laws reduce the number of jobs available to low-wage workers and drive businesses away from the jurisdictions that enact them.

This discussion paper describes the living wage laws that currently exist and reviews the academic evidence on their impact. It focuses on the laws’ impacts on labor market outcomes such as wage levels, employment rates, poverty, and inequality. The review’s most important findings for policymakers and practitioners are:

• Living wage laws affect very few workers directly. Few workers work for firms that are subject to living wage laws. Most studies suggest that the laws cover only 2-3 percent of the bottom tenth of wage-earners. Even in a city of 1 million people, only about 1500 workers are likely to be covered. However, it is possible that the impacts of living wage laws spill over to other workers who do not work for covered employers.
• Living wage laws have both modest benefits and modest costs for low-wage workers. Living wage laws raise the wages of the lowest-wage workers. They may also result in lower turnover, better worker morale, and modest reductions in poverty. However, they lead to modest reductions in employment for the lowest-wage workers and may also result in reductions in training and in the use of part-time or overtime work.
• Living wage laws can be useful but meaningful increases in the earnings of low-wage workers and reductions in poverty require more powerful public policies. Because of their limited coverage and modest affects on wages, living wage laws cannot have a large impact on low wages or poverty. Other public policies, such as those to expand collective bargaining, education and training, and publicly financed health insurance and parental leave, are likely to have more impact. Living wage laws can be useful if they raise awareness of pay disparity issues and build support for more powerful policies to raise the earnings of low-wage workers.

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Economic development policymakers are increasingly looking to hospitals and universities as potential drivers of economic development in metropolitan areas, especially in central cities. These “eds and meds” institutions are large, immobile and often growing employers that hold the potential to offer relatively high-wage jobs to workers without college degrees. A number of metropolitan areas have large concentrations of colleges and universities, while health care institutions are more evenly spread out among metropolitan areas. This report examines the impact on metropolitan economic development of policies to expand health care and higher education institutions.

• Expanding eds and meds brings in new income to a metropolitan area. It does so by enabling those institutions to serve more students or patients who live elsewhere and who would not otherwise spend money in the metropolitan area. This effect is greater for an expansion of eds than for an expansion of meds, since more people cross metropolitan area boundaries to attend school than to receive medical treatment.
• Expanding eds raises metropolitan residents’ earnings by improving their skills. The presence of eds in a metropolitan area makes area residents more likely to earn college degrees and remain in the area to work. In addition, students who come to the area from elsewhere are more likely to remain in the area to work after completing their degrees. In both these ways, expanding eds increases the percentage of a metropolitan area’s residents who have college degrees and, therefore, increases earnings.
• Expanding university research spurs metropolitan economic development. University research can lead to the creation of new businesses in a metropolitan area and improve the performance of existing businesses. It can do so through technology transfer activities and through the broader involvement of universities with local businesses.
• Expanding meds is likely to encourage other employers in a metropolitan area to pay higher wages. Health care pays higher than average wages regardless of workers’ skills and demographic characteristics. Expanding health care is likely to raise wages throughout a metropolitan area by putting upward pressure on wages throughout the metropolitan labor market.

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Findings

Using data from the 1990 and 2000 Census of Population, an analysis of workers and jobs in the
central cities and lower- and higher-income suburbs of the largest 150 metropolitan areas indicates
that:

• Roughly 65 percent of all residents and nearly 60 percent of all jobs are now located in the suburbs, with over a third of each in the higher-income suburbs. More individuals now live in the higher-income suburbs than in the central cities, and nearly as many jobs are in the higher-income suburbs as well.
• Population grew strongly during the 1990s in the lower-income suburbs, while job growth was particularly strong in the higher-income suburbs. Residential populations grew by 36 percent in lower-income suburbs, compared to just 24 percent in the central cities and 16 percent in the higher-income suburbs; while employment growth was more rapid (at 26 percent) in the higher-income suburbs, than in the central cities and lower-income suburbs (18 percent each).
• Population growth in the lower-income suburbs for blacks and Latinos has been especially dramatic, while their employment growth in these areas lags behind. Population growth in the lower-income suburbs is also especially pronounced for less-educated groups. But job growth lags behind population growth in the lower-income suburbs and exceeds it in the higher-income suburbs for all educational groups.
• Most groups of residents in the lower-income suburbs must now commute out for work, especially to the higher-income suburbs. Major changes in commute patterns over the 1990s were observed among Latinos (and, to a lesser extent, high school dropouts), with the sharpest increases in commutes towards the higher-income suburbs occurring among members of these groups who live in the central cities and lower-income suburbs.
• The accessibility of residents of lower-income suburbs to jobs in higher-income areas appears to vary greatly across metropolitan areas. Lower-income suburbs are largely contiguous to higher-income suburbs in some metropolitan areas (such as Baltimore and Boston) while they are mostly concentrated on different sides of the central cities in other areas (such as Atlanta, Chicago, and Denver).

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Findings

This report examines the link between income inequality and new housing construction in various metropolitan areas. Using data from the Census and Neighborhood Change Database on 215 metropolitan areas, the analysis compares trends between economically distressed metropolitan areas (those that experienced little or no population or economic growth) and non-distressed metropolitan areas. It finds that:

Between 1960 and 2000, the average rate of new housing construction per decade was about six times the rate of population growth in distressed metropolitan areas, a ratio far greater than in any other type of metropolitan area.
In contrast, metropolitan areas experiencing the most rapid population growth had an average rate of new construction that was only about 1.5 times their population growth rate.

Between 1970 and 2000, both distressed and non-distressed metropolitan areas with rapidly growing income inequality experienced rapidly growing residential segregation by income.
Income segregation refers to the sorting of rich families into rich neighborhoods and poor families into poor neighborhoods. Oshkosh, WI, which had the third smallest increase in income inequality between 1970 and 2000 among the 47 distressed metropolitan areas, had the third smallest increase in income segregation. Flint, MI, had the greatest increase in income inequality and the second greatest increase in income segregation among the distressed areas.

In distressed metropolitan areas between 1970 and 2000, rising income segregation was associated with excess housing construction. In non-distressed metropolitan areas, there was no relationship between income segregation and excess housing construction. Excess housing construction, defined as that beyond what would be predicted on the basis of population growth, often results in the abandonment of older housing in the urban core.

Rising income inequality and neighborhood income segregation accounted for 16 to 50 percent of new construction in distressed metropolitan areas between 1970 and 2000.
The percentage of new housing construction in distressed areas that resulted from increasing income inequality and income segregation since 1970 was 16 percent in 1980, 39 percent in 1990, and 50 percent in 2000.

Policymakers in economically distressed metropolitan areas who are concerned about the effects of overbuilding and income segregation—such as the decline of older cities and inner suburbs and the perpetuation of poverty—should be concerned about income inequality. Policies that reduce income inequality can help reduce overbuilding and income segregation in distressed areas.

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An examination of service offshoring—the movement of service jobs overseas—forecasts higher than average job losses in twenty-eight U.S. metropolitan areas between 2004 and 2015. Information technology jobs, and the metropolitan areas where they are concentrated, will be hardest hit. To cushion the service offshoring blow, the paper urges federal, state, and local leaders to together pursue policies that boost productivity and innovation, assist workers who are harmed by offshoring, and modernize approaches to economic and workforce development.

Findings

Service "offshoring"—the movement of service jobs from the United States to other countries, especially low-wage countries—has emerged as a concern of both political and business leaders in recent years. Using occupational data, this study projects the likely job losses from service offshoring between 2004 and 2015 in 246 U.S. metropolitan areas. It finds that:

• Twenty-eight metropolitan areas, with 13.5 percent of the nation's population, are likely to lose between 2.6 and 4.3 percent of their jobs to service offshoring, higher than the average loss among the metropolitan areas studied. Five metropolitan areas—Boulder, CO; Lowell, MA; San Francisco, CA; San Jose, CA; and Stamford, CT—are likely to lose between 3.1 and 4.3 percent of their jobs to service offshoring between 2004 and 2015, while 23 others are likely to lose between 2.6 and 3 percent of their jobs. However, 158 metropolitan areas are likely to lose no more than 2 percent of their jobs as a result of service offshoring.
• Large metropolitan areas and metropolitan areas in the Northeast and West are generally more vulnerable to service offshoring than small metropolitan areas or metropolitan areas in the Midwest or South. Job losses from service offshoring between 2004 and 2015 are projected at 2.4 percent for metropolitan areas with populations of one million or more but only 1.7 percent for metropolitan areas with populations below 250,000. About 2.3 percent of jobs in Northeastern and Western metropolitan areas are likely to be offshored, compared to 2.2 percent in Midwestern metropolitan areas and 2.1 percent in Southern ones.
• Metropolitan areas with large concentrations of information technology service jobs or backoffice jobs are generally more vulnerable to service offshoring than other metropolitan areas. Between 2004 and 2015, service offshoring is likely to cause the loss of 2.6 percent of jobs in metropolitan areas that specialize in information technology services and 2.4 percent of jobs in metropolitan areas that specialize in back-office services but only 1.9 percent of jobs in other metropolitan areas.
• At least 17 percent of computer programming, software engineering, and data entry jobs are likely to be offshored in particular metropolitan areas. Employment of computer programmers, data entry keyers, and software engineers (applications) is projected to fall by at least 17 percent between 2004 and 2015 in Bergen-Passaic, NJ; Boston, MA; Boulder, CO; Danbury, CT; Denver, CO; Hartford, CT; Minneapolis, MN; Nashua, NH; Newark, NJ; Orange County, CA; San Francisco, CA; San Jose, CA; Stamford, CT; and Wilmington, DE because of service offshoring. In Bergen-Passaic, 14 to 17 percent of customer service representatives' and insurance underwriters' jobs are projected to move abroad.

Overall, the loss of service jobs to offshoring in the near future will be modest. However, offshoring's impact will be greater in metropolitan areas with high shares of information technology or back-office service jobs and in particular occupations within metropolitan areas. To reduce vulnerability to service offshoring, federal, state, and local leaders should work in concert to pursue policies that boost productivity and innovation, assist workers who are harmed by offshoring, and modernize approaches to economic and workforce development.

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Findings

Analysis of manufacturing employment and production in seven Great Lakes states and their metro-politan areas from 1995 through 2005 finds that:

• More than one-third of the nation's loss of manufacturing jobs between 2000 and 2005 occurred in seven Great Lakes states: Illinois, Indiana, Michigan, New York, Ohio, Pennsylvania, and Wisconsin. Between 1995 and 2005, the United States lost more than 3 million manufacturing jobs. Nearly all of this job loss occurred during the last five years, and 37.5 percentof the loss occurred in the seven Great Lakes states. Michigan lost the most manufacturing jobs between 2000 and 2005 (nearly 218,000), followed by Ohio, Illinois, and Pennsylvania.

• Despite these job losses, manufacturing remains a major driver of the nation's economy and the economy of the Great Lakes region. Because productivity was higher in manufacturing than in other sectors of the economy, in 2004, manufacturing accounted for a higher share of gross state product than its share of employment, both nationwide and in six of the seven states in the Great Lakes manufacturing belt. In addition, productivity in the manufacturing sector increased by 38 percent between 1997 and 2004, a much higher increase than the 24.4 percent growth in productivity for all non-farm businesses during that same time period.

• Manufacturing job losses were pervasive in Great Lakes metropolitan areas. All but one of the 25 largest manufacturing-dependent metropolitan areas in the Great Lakes region lost manufacturing jobs during the last decade (1995-2005), often at a faster rate than the United States as a whole. Chicago and Detroit lost the most manufacturing jobs in the last five years (over 100,000 jobs each), while Canton, OH, and Flint, MI, lost the greatest shares of manufacturing employment.

• The metropolitan areas in which manufacturing employment peaked between 1995 and 1997 tended to experience more severe manufacturing job losses between 1995 and 2005 than those in which manufacturing peaked later. The 13 metropolitan areas where manufacturing employment peaked between 1995 and 1997 saw an average 26.8 percent decline in manufacturing employment between 1995 and 2005. In the other 11 metropolitan areas where manufacturing employment peaked later, between 1998 and 2000, the average metropolitan area lost 18.9 percentof its manufacturing jobs during the decade.

• Manufacturing job losses were a major reason for slow overall job growth, and sometimes overall job losses, in Great Lakes metropolitan areas. Furthermore, employment gains in high-wage advanced service industries, which occurred in all but one of the 25 metropolitan areas studied, were not large enough to offset the loss of manufacturing jobs in most areas.

Although not all manufacturing jobs can or should be saved, a combination of trade, health care, and economic and workforce development policies can help to retain and expand employment in high-productivity manufacturing in the United States.

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