This was partly because of China's arrival on the world scene, after it joined the World Trade Organization in 2001. Since then, China has gained nearly 40 million factory jobs. But something else has happened too: Companies across the developed world have invested in labor-saving technology.
Consider Master Lock. Its Milwaukee plant is operating at capacity for the first time in 15 years, before it started sending work overseas. It is producing much more stuff than it did back then. But it is doing so with 412 workers -- about 750 fewer than it had 15 years ago.
So it is across the economy. In his forthcoming book, "The New Geography of Jobs," the economist Enrico Moretti of the University of California, Berkeley, points out that the average American factory worker makes $180,000 worth of goods a year, more than three times the value of what he produced in 1978, in current dollars.
It may not matter to workers who lost their jobs. Whether forced out because production moved to China or because a new machine makes it easier to compete, the job is gone. Still, the distinction is important. Without understanding the forces at work, policy makers' efforts to bolster manufacturing could backfire.
One thing is clear. Most of the jobs lost to China and other poor countries cannot "come back." They do not pay nearly enough. And they do not exist anymore anyway.
The factory jobs Americans really want will be fewer and will require more education. But they will pay more.
Remember agriculture? In the 1960s, scientists at the University of California, Davis, developed an oblong tomato and engineers developed a machine to harvest it with one pass through the fields. By the 1970s the number of workers hired for the tomato harvest in California had fallen 90 percent.
In the book "Promise Unfulfilled: Unions, Immigration, and the Farm Workers," Philip L. Martin, an economist at the university, says that in 1979 the worker advocacy group California Rural Legal Assistance sued the university for using public money on research that helped agribusiness at the expense of farm workers.
And in 1980, President Jimmy Carter's agriculture secretary, Robert S. Bergland, declared that the government would not finance any more projects aimed at replacing "an adequate and willing work force with machines."
It is hard to say that workers won this battle, however. After Mr. Bergland pulled the plug, research on agricultural mechanization came to a near halt. Yet farm work today remains probably the worst paid, most grueling job in the United States.
A tricky thing to understand is that most U.S. jobs are created in areas of the economy not exposed to global competition. They are nannies and doctors, lawyers and roofers.
In a recent study, the Nobel laureate Michael Spence and Sandile Hlatshwayo of New York University found that the part of the economy that does not have foreign competitors added 27.3 million jobs from 1990 to 2008. The sector that competes in global markets added virtually none.
This does not mean the administration should ignore manufacturing. The country needs world-class, innovative industries that compete in global markets. They will not add a ton of jobs precisely because they must stay lean to compete. But they will pay for those jobs.
The 33,000 Apple workers in Cupertino, California, sustain 171,000 additional jobs in the metropolitan area, Mr. Moretti estimates.
This pattern suggests, however, that a jobs strategy should take care not to blunt the edge of America's most competitive companies. If outsourcing sharpens their edge in world markets, punishing them for doing so could destroy American jobs.
More important, perhaps, manufacturing is not the country's only cutting-edge industry. Many of the most innovative businesses are not manufacturers but service companies.
Apple is very competitive. But so are the companies that design applications running on its iPhones and iPads. Hollywood studios and marketing companies are big exporters. These companies need highly trained workers and pay high wages.
Mr. Moretti said each job in an "innovation" industry, broadly understood, created five other local jobs, about three times the number for an average job in manufacturing. Two of them are highly paid professional positions and three are low-paid jobs like waiters or clerks.
Innovation -- not manufacturing --has always propelled progress in the United States.
A strategy to reward manufacturers who increase their domestic payroll may not be as effective as one to support the companies whose creations -- whether physical stuff or immaterial services -- can conquer world markets and pay for the jobs of the rest of us.
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