macroeconomic development in the United States
Macroeconomics constitutes a branch of economics designed to study the overall economy and the behavior and operation of the market system on a large scale. Macroeconomics seeks to study wide economic phenomena like inflation, changes in unemployment, gross domestic product, price levels, national income, and the rate of economic growth. Manufacturing industries constitute a crucial aspect of the economic development of the United States since considered a path to the event, the foundation of global high power, economic growth, and creation of jobs, among other factors. This paper examines the macroeconomic development in the United States in terms of gross domestic product growth, unemployment rates, inflation, interest rates, imports and exports, and monetary policy, as discussed below.
The growth and development of the manufacturing sector in the United States over the past half-century displays two striking and contradictory features. First, the real output growth in the manufacturing industry measured by real added has exceeded or equaled the total Gross Domestic Product hence keeping the manufacturing sector constant in terms of price-adjustment. Second, there is the existence of a long-standing decline share of the full employment attributed to the manufacturing industry. These contradicting trends propelled by the recent crisis in the manufacturing sector. However, there exist some potential causes that call for concern. The output of the manufacturing share of the gross domestic product has been stable for the last 50 years. Thus the manufacturing sector has retained a reputation as a sector characterized by rapid productivity movement. The status linked to the existence of the spectacular performance of a single subsector of manufacturing in terms of computers and electronics.
According to the research by the Bureau of Labor Statistics in October 2017, there was a fall in manufacturing employment from about 12.3 million in2016 to approximately 11.6 million. The manufacturing industries in the United States employed about 12.4 million workers in March 2017, hence generating GDP output of about $2.2 trillion in Q3 2016, with real GDP of $1.9 trillion in 2009 dollars. The United States has witnessed a decline in manufacturing employment since the entry of China in the World Trade Organization. In 2001, the United States stock ended a sustained 14 years bubble and as well as the ensuing job loss, hence pushed a significant portion of the population of the US below the poverty line.
There exist economic policies set to ensure growth and employment in the manufacturing sector in the United States. These policy recommendations intend to enable the US to be a more attractive location in terms of manufacturing production. There has been a steady decline in manufacturing employment from about 28% in 1960 to about 8% in 2017. The steady decline led to a fall of the job from about 17.2 million workers in December 2000 to about 12.4 in March 2017, estimated to be about 5.7 million. The decline in manufacturing employment linked to the competition with China, which came to the World Trade Organization in December 2001. According to the Economic Policy Institute, the trade deficit with China resulted in the loss of about 2.7 million jobs between 2001 and 2011.
In conclusion, the manufacturing sector has struggled to increase even though the United States has become more much integrated into the marketplace globally. Lack of the supportive United States’ currency and trade policies and as well as low energy and industrial policies harm the ability of the nation to meet the future dares that might require a solid manufacturing base. The manufacturing sector in the US plays a crucial role in terms of innovation capacity. The United States should, therefore, resort to reinvesting in the field, such as research, energy, development, and manufacturing policies, to stimulate the growth rate.