U.S. Factories: White-Collar Education for Blue-Collar Work

Summary

WSJ Your Money Briefing

Episode: U.S. Factories: White-Collar Education for Blue-Collar Work

Date: December 10, 2019

Host: J.R. Whalen (The Wall Street Journal)
Guest: Austin Hufford (WSJ Reporter)

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Episode Overview

This episode explores a major shift in the U.S. manufacturing sector: the move from traditional, low-skill factory jobs to highly skilled positions requiring advanced training and, increasingly, college degrees. WSJ reporter Austin Hufford discusses how automation, evolving skill requirements, and economic changes are reshaping factory work—and what this means for workers, businesses, and the future of the American middle class.

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Key Discussion Points & Insights

The Shift in Manufacturing Workforce

• Upscaling & Automation:
  • The manufacturing sector has seen significant upskilling over recent decades, driven by automation and trade changes.
    • “Within a few years, there's going to be more manufacturing workers with college degrees than workers with at most a high school education.” — Austin Hufford (02:04)
• Data on Job Shifts:
  • Complex problem-solving jobs (e.g., engineers) grew by 10% in the past six years.
  • Low-skill, rote jobs (e.g., cleaners) declined by 3%.
    • “The jobs that require the most thinking are growing, and the jobs that require the least amount of thought...are declining.” — Austin Hufford (02:30)
• Impact of the Recession:
  • The post-recession recovery accelerated this trend.
  • Despite over a million new manufacturing jobs since the recession, fewer people with only a high school diploma are now employed in manufacturing than before 2007.
    • “The new jobs added have increasingly been going to the higher skilled...less people employed today in manufacturing with a high school diploma than before the recession.” — Austin Hufford (03:03)

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Skills in Demand

• Types of Skills:
  • Companies prioritize practical, technical skills—welding, advanced milling machine operation—over general college degrees.
    • “They want someone who knows how to weld, who can operate an advanced milling machine...It's not about...an advanced exploration of the mind as many people think college is about.” — Austin Hufford (03:29)

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Case Study: Pioneer Service (A Chicago-area Machine Shop)

• Technological Transformation:
  • Significant investment in automation over the last 5-10 years.
  • Workforce is now ~50% women, higher education levels than before.
    • “About half of its workforce is women, and they're much highly educated than before.” — Austin Hufford (04:02)
• Nature of Work:
  • Produces small, intricate metal parts with tight manufacturing tolerances, reflecting advanced manufacturing.
    • “These parts have very high tolerances, meaning that they can't be off by even more than a millimeter in some cases.” — Austin Hufford (04:23)

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Opportunities for Women

• Trends:
  • More women are pursuing advanced degrees, which theoretically aligns with manufacturing's new educational demands.
    • “There are more women pursuing advanced degrees than men. And so...as these manufacturing companies increasingly hire people with degrees, they might be hiring more women.” — Austin Hufford (05:04)
  • Despite this potential, general gender ratios in manufacturing have not shifted significantly.

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The Displacement of Less-Educated Workers

• Challenges:
  • Workers laid off in prior economic downturns are not necessarily the ones being rehired; new roles demand greater skills.
    • “Workers that manufacturers are hiring are not the same workers who were laid off in 2007.” — Austin Hufford (05:48)
• Reskilling Questions:
  • Can mid-career or older workers return to school or complete training necessary for these advanced positions?
  • Barriers like childcare and opportunity cost for older workers remain substantial.

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Impact on the Middle Class

• Pathways to Middle-Class Jobs:
  • Many skilled manufacturing positions require only a two-year associate degree or certificate—bachelor’s degrees from elite institutions are not a prerequisite.
    • “They might only need a two year associate degree or even a short term certificate program.” — Austin Hufford (06:24)
• Skills Mismatch:
  • Manufacturers report persistent difficulty finding enough skilled workers; the education system is not supplying the right talent.
    • “There is definitely a skills mismatch...the skills that companies want in manufacturing are not being supplied by workers who have them.” — Austin Hufford (06:24)

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Workers' Perspective

• Difficulty of Upskilling:
  • Few production workers at Pioneer successfully retrained for advanced roles—less than five stayed on through the transition.
    • “Very few of the production workers at Pioneer remain the same today. Basically less than five of them were able to successfully make the transition from manual production worker to a machine operator.” — Austin Hufford (07:17)
• Barriers Beyond Education:
  • Issues like lack of childcare and financial security prevent some adults from pursuing further education even if training is offered.

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Notable Quotes & Memorable Moments

| Timestamp | Speaker | Quote | |-----------|--------------|-----------------------------------------------------------------------------------------------------| | 02:04 | Austin Hufford | "Within a few years there's going to be more manufacturing workers with college degrees than workers with at most a high school education." | | 03:03 | Austin Hufford | "The new jobs added have increasingly been going to the higher skilled...less people employed today in manufacturing with a high school diploma than before the recession." | | 03:29 | Austin Hufford | "They want someone who knows how to weld, who can operate an advanced milling machine...It's not about...an advanced exploration of the mind as many people think college is about." | | 04:02 | Austin Hufford | "About half of its workforce is women, and they're much highly educated than before." | | 05:48 | Austin Hufford | "Workers that manufacturers are hiring are not the same workers who were laid off in 2007." | | 06:24 | Austin Hufford | "They might only need a two year associate degree or even a short term certificate program." | | 07:17 | Austin Hufford | "Very few of the production workers at Pioneer remain the same today...less than five were able to successfully make the transition from manual production worker to a machine operator." |

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Important Timestamps

• 02:04: Major workforce shift toward college-educated workers
• 02:30: Data on skill requirements in job growth/decline
• 03:03: Role of recession in accelerating the shift
• 03:29: Details on sought-after skills
• 04:02: Pioneer Service's transformation and workforce changes
• 05:04: Growth of women's opportunities; changing role of advanced degrees
• 05:48: Challenges for lesser-educated, displaced workers
• 06:24: Pathways to skilled work beyond the four-year degree; skills gap issue
• 07:17: Difficulties actual workers face in retraining

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Tone and Takeaways

The episode maintains a factual, analytical tone. Both Whalen and Hufford present the challenges and opportunities arising from a rapidly evolving manufacturing sector. Despite technological progress and the promise of good, skilled jobs, a persistent skills gap and barriers to education/training threaten to leave many workers behind. The need for better education, training infrastructure, and awareness of career pathways is stressed for sustaining a vibrant and inclusive manufacturing workforce.

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Summary prepared for listeners who want an in-depth yet clear picture of how U.S. manufacturing is changing, and the new realities for workers navigating this transformed job landscape.

Transcript

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[J.R. Whalen]

Here's your money briefing for Tuesday, December 10th. I'm J.R. whalen at the Wall Street Journal in New York. The manufacturing sector used to employ more workers without college degrees than those with a higher education. Not anymore. In the past few years, there's been a shift in factories toward problem solving and highly computerized automation, and they need more highly skilled workers to run them. Wall Street Journal reporter Austin Hufford will explain. First, some money in market news you should know. Natural gas prices continue to decline. On Monday, futures prices for January fell 4.5% amid unseasonably mild weather and continued production growth. And while a cold spell is expected to pass over the Midwest and the east during the middle of this week, which could raise gas demand, it's not likely to last. Forecasters believe that December's generally mild weather will will result in the natural gas market finishing the winter oversupplied and could push prices to their lowest level in three years. US Manufacturers have added more than a million jobs since the recession, but manufacturing jobs are evolving now. They require more automation and an education gap has emerged. Wall Street Journal reporter Austin Hufford joins us to discuss. So, Austin, there's a stark difference in the profile of the manufacturing workforce before and compared to after the recession.

[Austin Hufford]

Basically, over the last few decades, we're seeing an upscaling of the manufacturing economy, you know, driven by automation and trade. Basically, that means is that within a few years there's going to be more manufacturing workers with college degrees than workers with at most the high school education.

[J.R. Whalen]

And what do the data tell you is the degree to which jobs have shifted in the manufacturing sector in the last six years.

[Austin Hufford]

The jobs requiring the most complex problem solving skills, like the engineers and those types of jobs, grew 10%. The jobs that required the least amount of complex problem solving skills, such as cleaners, fell 3%. This is likely to be repeated across the manufacturing economy. Basically, the jobs that require the most thinking are growing, and the jobs that require the least amount of thought, the ones that are most rote, are declining.

[J.R. Whalen]

So this trend has been going on for some time. But did the recession and the recovery accelerate that?

[Austin Hufford]

Yes, definitely. Basically in the aftermath of the recession that there was a ton of layoffs as factories closed and other things. And since then there's been a lot. The new Dobbs added have increasingly been going to the higher skilled. Even though we added more than a million jobs, there are actually less people employed today in manufacturing with a high school diploma than then before the recession.

[J.R. Whalen]

What kinds of advanced skills are being sought after by companies?

[Austin Hufford]

It's a wide range, but it's definitely things that are very skill based. You know, these manufacturing companies don't necessarily want a liberal arts education or an English degree. They want someone who knows how to weld, who can operate an advanced milling machine. It's, it's more about having skills that allows you to do specific jobs and grow with the company over time. It's not about sort of an advanced exploration of the mind as many people think college is about.

[J.R. Whalen]

Now, Austin, you saw these changes up close at a company called Pioneer Service in Chicago.

[Austin Hufford]

In the suburbs of Chicago, where I'm based, Pioneer Service has invested a ton in automating their, their factory floor. You, you know, basically over the last five or 10 years, the company has completely transformed itself. Now about half of its workforce is women, and they're much highly educated than before.

[J.R. Whalen]

And what sort of products does Pioneer Service provide?

[Austin Hufford]

So Pioneer Service is what we call a machine shop. Basically, they're making advanced and intricate metal parts. Most of them are pretty small, maybe under a foot on each side, maybe even only a few inches. But, but these parts have very high tolerances, meaning that they can't be off by even more than a millimeter in some cases. And so it's a great example of American manufacturing that continues to be made here in the US and it's also a great example of a type of manufacturing that has been heavily impacted by automation.

[J.R. Whalen]

And you alluded to this earlier, but in the shift toward higher skilled workers and workers with degrees, opportunities for women have grown.

[Austin Hufford]

That's what, when I talk to manufacturers on the ground, that's what they're telling me is they're saying that a lot of these opportunities are opportunities that are open to women in ways that wasn't a few decades before. In the US Today, there are more women pursuing advanced degrees than men. And so it stands to reason that as these manufacturing companies increasingly hire people with degrees, they might be hiring more women. At the same time, though, when you look more broadly at the manufacturing data, there hasn't been much of a shift in the gender ratio in recent years. And so that's something that I will be closely following to understand why we aren't seeing as many women in manufacturing as you might expect.

[J.R. Whalen]

Now, this shift has also impacted people who ended schooling early.

[Austin Hufford]

The concern here is that when politicians say they're going to bring manufacturing back, those the workers that manufacturers are hiring are not the same workers who were laid off in 2007. And so it raises important questions over for those workers who maybe only have a high school education, can they be reskilled? Can they go back to College when they're 45? What can they do? Because it does not seem that in the future of the US manufacturing economy they're not going to need that many workers with minimal physical skills.

[J.R. Whalen]

How does this narrowing of job requirements affect the middle class?

[Austin Hufford]

It's important to remember that for some of these jobs, they don't need a four year degree from an Ivy League school. They might only need a two year associate degree or even a short term certificate program. And so I think that a lot of it has to do with educating workers and educating families about the paths to prosperity in this country. When I talk to these factories and these factory owners, they say that they can't find enough skilled workers, that they want to be hiring more and more skilled workers, but the skills just aren't there. And so it does seem like there is definitely a skills mismatch in this country where the skills that companies want in manufacturing are not being supplied by workers who have them.

[J.R. Whalen]

Did you speak to lower skilled workers or workers without a degree about this? And what do they tell you they hope to do to get off the manufacturing sidelines?

[Austin Hufford]

I spoke to a number of current and former employees at Pioneer Service and for them they said learning the advanced skills was pretty difficult. Even though the factory has remained open and has about the same number of employees, very few of the production workers at Pioneer remain the same today. Basically less than five of them were able to successfully make the transition from manual production worker to a machine operator. And that's, I think, a very troubling trend that is likely to repeat itself across the broader economy. I spoke to one worker who left his manufacturing job at Pioneer and now he's a construction worker. And he says he enjoys it. He says it was a change of pace. But you also have to wonder what is stopping more workers from getting these degrees? Is it about not having childcare because you have two kids at home and you can't leave your job in the short term? I hear a lot about initiatives like that to, to pay for workers beyond just the cost of education itself.

[J.R. Whalen]

All right. That's Wall Street Journal reporter Austin Hufford joining us. Austin, thank you so much for coming on the show.

[Austin Hufford]

Thank you.

[J.R. Whalen]

And that's your money briefing. I'm JR Whalen in New York for the Wall Street Journal.

[Small Business Owner]

Access to affordable credit helps me pay my employees, but I don't really need it.

[Retail Industry Advocate]

Inflation is killing me, but who cares? Big retailers are making record profits. That's why we support or the Durbin Marshall credit card bill.

[Small Business Owner]

See, banks and credit unions help small businesses make payroll. This bill would cut the vital resources

[Retail Industry Advocate]

they need while increasing megastore profits. They deserve it, don't they?

[Electronic Payments Coalition Representative]

Tell Congress, stop the Durbin Marshall money grab for corporate megastores paid for by the Electronic Payments Coalition.