“Manufacturing jobs is basically what rich people think poor people want.” Justin Wolfers · Platypus Economics with Justin Wolfers
Money & Markets · September 2026
Asked whether economics has anything useful to say about rebuilding America's industrial base, Wolfers turned the question around and asked why anyone would want to. He allows for national-security exceptions, then points out that manufacturing paid above-average wages in the 1950s and pays below-average ones now. This line is his account of why the goal keeps its appeal anyway.
Transcript
pick up on that for a moment, August? Because it's actually just utterly remarkable. I want our Canadian friends to know that Americans are in their corner. So some of the most remarkable polling I've seen recently was polling showing, first of all, that Americans didn't support Trump's tariffs on Canada. A majority of Americans didn't support that. Even more surprising, Mark Carney's retaliation, more Americans approved of that than disapproved. Americans are actually on the side, like regular Americans, are on the side of regular Canadians right now. They think the way the United States is treating Canada is terrible. And they seem to believe that Canada has every right and reason to fight back.
Well, it's interesting. So my last question is connected to that in some way, which is that some proponents of tariffs, especially early on, were saying that they're only a part of a long-term strategy to kind of rebuild America's industrial base or manufacturing capacity. Obviously, that has not happened. But is there anything that economics can tell us about how to achieve that goal in the medium term? Or maybe you think that that's not a meaningful goal to achieve?
Good question. So this is also the view, and I saw this expressed in some of the comments. You know, we're in the fifth inning of a nine-inning game. You can't issue the report card yet. I'm not sure that's right because these tariffs are only going to last as long as the Trump presidency. So the smart tariffs and smart trading deals are seen as somewhat persistent. And that creates the conditions for persistent investment. And so should play out over many, many years. But brief, temporary tariffs are going to have brief temporary effects. And so I think it's totally okay to be looking right now because these tariffs are brief and temporary. How could we rebuild the American industrial base? You gave me an out, and I appreciate the out, which is, why do we want to? Wow, that's a harsh question. Wow, that feels weird. But I mean it. Look, there's national security issues. We should definitely take every one of them seriously. But when people talk about the American industrial base, they're basically saying, what I want is more manufacturing jobs. That what I want is my son or daughter to wake up in the morning and wear steel-toed boots and carry a lunch pail to a factory, punch in, work in the factory, punch out, go home. And in the 1960s, manufacturing job was the pathway to the middle class and had a lot to recommend it. Today, that's less clear. I've actually looked at some survey research on this. Manufacturing jobs is basically what rich people think poor people want. But if you talk to a manufacturing worker and you ask them about their hopes and dreams and aspirations for their kids, it's not to be punching in and out of a noisy or dirty factory. In fact, it's to take the sorts of white-collar or possibly pink-collar jobs that are less hard on the body that the administration seems to deride so much. So a different way of saying all of this is: I just want to let people make smart choices for themselves. I don't know that the next generation of kids want to. Wear hard hats and steel-toed boots. They might want to sit at a computer. So, given that, I'm going to say, let's just, all jobs matter. Why put the thumb on the scale of this specific weird subset? Now, I want to give a defense, or I want to take my part of the blame for all of this. I think the reason is people have an affection for stuff. You know what comes out at the end of a manufacturing plant? Stuff, a thing. They made a thing, you know, like a car or a truck or a gold pig, even, right? And it feels like an economy of stuff. You can't just have an economy of services. And I think that's where my tribe of economists have failed, which is actually, we don't need stuff to be real. Let me give an analogy. 200 years ago, 90% of Americans worked on farms. What happened was farms got so productive through mechanization and hybrid seed corn and all of the scientific changes that we can now grow enough food for all Americans, but it only requires one in 100 Americans to be on a farm. So we still get fed, but we don't have to be on a farm. Now, of course, 100 years ago, people are like, oh, no, it's the death of America because we're no longer growing food. You can't have an economy where we're not all just growing food. Turns out you can. We went on and we made stuff instead. And then what's happened to manufacturing is basically the same process, but it's a century, a century and a half later, which is factories no longer have people in them. They have robots and an occasional person to plug them in and unplug them and check their working. As a result, we are getting a lot of stuff. My house is full of stuff. Your house is full of stuff. Right? But it's stuff that we no longer need people to be making. And what that does is it frees up other people for the things that a rich nation wants. Now that I'm wealthy, I have enough food to eat. I don't want to employ more people on farms to make more food than I want. And I have enough cars. My family now has two. That feels like a lot. And we're not going to be better off if we force people to make more cars. What do I want? I want a good education system. I want medical care. I want a therapist. I want to go to the museum and see beautiful art. I want to go to a concert. I want to go to a coffee shop and have my barista make me the perfect beverage. Those are all services. And if what we do is keep people in manufacturing, we're putting a thumb on the scale of history rather than what people want. And so I don't see the appeal. I've been in a factory. It's not my dream. I am quite against manufacturing fetishism. And I think of it as a fetish. And again, I think the reason for that fetish is my tribe, economists, haven't explained very well that we are still manufacturing a lot of stuff. We just don't need a lot of people to do it.
Is there an equivalent to what you just said to white-collar jobs and AI? Is that the future that people are scared about happening now?
You just made everything I said so much harder. And that's so mean of you, Augusta. Look, the truth is when the agricultural revolution happened, people were terrified we were going to lose our way of life. And at some level, we did lose our way of life. We're no longer on farms. We no longer see the blue sky. We no longer see green grass. We no longer pat Bessie the cow. Our milk comes in cartons rather than from udders. We did lose a way of life. Part of what we lost was hunger because now we can produce enough food for everyone. Okay, we moved to the industrial era. You know, the reason the 50s and the 60s are thought of as a time of plenty is because for the first time ever, stuff became abundant. And now we're moving on. Have moved on, to be clear. We have moved on from the industrial era. In the 1950s, manufacturing jobs were above average wages. Now they're below. It was a big part of the workforce. Young boys and to an extent, young girls as they left high school looked forward to their future in the factories. We've lost that way of life. We've moved to one instead where right now I'm working from home and so are you and so is many of our audience. And we're working in the knowledge economy and we're working in services and we've lost the way of life of the factory. But you're working from home and I bet there's a great coffee shop just around the corner. And I bet you get to figure out ways in which you want to organize your day that work best for you and your life. So we lost a way of life, but we got a new one. And what we get now is just the manufacturing era, we got rid of, that was after we got rid of hunger. Now we no longer hunger for more stuff. Now we hunger for more services. So change that creates more stuff out of less effort generally tends to be a good thing for society as a whole. And when I tell the story as one that plays out over decades, it feels less threatening. And each of those past changes, I think, has been for the better. There are still people who say, oh, I wish we were back in the 50s or 60s, but they forget about the fact that the average size of a home was 1,200 square. Defeat that a house had one car, that it may most of the time it had plumbing, but not always, that a television was a big chunk of the annual family budget, that that family rarely went away on holidays, that they didn't ever got to travel abroad, rarely to other states, and so on. So, there's still some nostalgia for the 50s. The 50s, of course, also a time when women were not embraced in the workforce, often trapped in bad marriages, lacked very, very good options, and so on. And so, as we move towards this next revolution, the AI one, we're going to lose a way of life. Knowledge workers like you and me were under threat. So, all of those past things worked out okay. So, I could say this is going to work out okay. All of those past things had a lot of anxiety in the moment that it was happening. Now, they played out very slowly. They played out over decades and decades and decades. We did a video a few weeks ago, I'd love people to look it up about Victorian bootmakers. And it turns out that we used to make boots by hand and then the sewing machine came along. That was a similar revolution to, you can think about that as an analogy to AI. And the thing is, that played out over about six decades, which basically meant every bloke who was a bootmaker at the start of his career was still a bootmaker at the end, but his son didn't enter the industry. So, that was a slow rate of change with not a lot of, you know, it wasn't very tumultuous. If the current forecasts about AI stand up, and my view is the technologists are too optimistic, they think everything, the revolution comes within three years. History, which says stuff plays out over many decades, probably it's going to be quicker than that. And it's that speed that's going to make it really, really uncomfortable. And we're not going to be in the case, you know, a bootmaker got to start their career as a bootmaker and end as one. A modern-day coder will not have that. And so, the anxiety that people feel about that, I think, is absolutely real and presents really important policy challenges. You're saying, well, that's just saying nothing right now. That's right, because these are hard questions that we need to think of. And, Augusta, you're going to push all of us at Platypus Economics to make sure we have smart things to say about what is one of the most anxiety-inducing and exciting technological revolutions of our lifetime.
Thank you, Justin, and thank you to everybody watching. We really hope you enjoyed this episode of The Professor Is In, and also that you learned something along the way. If you would like your questions answered in a future segment, leave a comment wherever you're reading this or watching it or even listening to it. And make sure that you like and subscribe to Platypus Economics on YouTube and Substack. For those of you who are listening, you can subscribe on Apple Podcasts, Spotify, and anywhere else you might get your podcasts. Thank you.
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