U.S. manufacturing efficiency: Bad for the local job market?

Published 3:19 pm Thursday, February 10, 2011

Chevron’s announcement that it will build a $1.4 billion lubricants manufacturing facility at its refinery in Pascagoula is certainly good news for the Mississippi economy.

But as far as jobs are concerned, it isn’t what one would expect, considering the investment.

Officials said the Pascagoula Base Oil Project will create about 1,000 jobs over the next two years of construction, and that is significant. But only about 20 permanent positions are projected once the facility is operating.

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The facility will manufacture 25,000 barrels per day of premium base oil, the main ingredient in the production of top-tier motor oil.

Pointing out the number of permanent new jobs being created is certainly not meant to downplay the importance of the announcement. As Chevron’s largest wholly owned refinery, the Pascagoula facility already has a work force of 1,610 and processes up to 330,000 barrels per day of crude oil to produce gasoline, jet fuel, diesel and other products.

So, this new expansion is building on what’s already there, without a lot of new jobs being created, except for the construction.

That’s in keeping with what’s happening throughout manufacturing in the United States. We are producing more with fewer employees, according to figures recently reported; that’s a message that should be understood by today’s young people.

An Associated Press article said that, contrary to the perception of many people, “America remains by far the No. 1 manufacturing country. It out-produces No. 2 China by more than 40 percent. U.S. manufacturers cranked out nearly $1.7 trillion in goods in 2009, according to the United Nations. The story of American factories essentially boils down to this: They’ve managed to make more goods with fewer workers. The U.S. has lost nearly 8 million factory jobs since manufacturing employment peaked at 19.6 million in mid-1979. U.S. manufacturers have placed near the top of world rankings in productivity gains over the past three decades. That higher productivity has meant a leaner manufacturing force that’s capitalized on efficiency.”

Whether that’s good or bad news probably depends on who you are. …