Manufacturing Sector

The globalizing trend that has characterized the economy since the 1990s has had a strong impact on the manufacturing sector. In the definition of globalization given by Anthony Giddens, goods, and by extension, the manufacturing sector, play an important part. The sociologist defines the process as the international integration of markets for an easier circulation of goods, services, and capital. To Giddens, globalization produces a world economy where trade has fewer governmental restrictions and favors a faster dissemination of advanced technologies and consumption patterns.

The manufacturing sector contributes to global economic growth by producing consumer goods from raw materials or intermediate goods which are then reused in the production of other manufactures. This production can take place thanks to manual labor or the use of machinery and is usually planned according to the principles of the division of labor. The term can refer in particular to the production of goods on a vast scale and include industries that make airplanes, vehicles, chemicals, computers, and other high-tech and electronic products, furniture, and household appliances. Manufacturing typically follows this pattern: First, the goods are produced in factories; then, they are sold to wholesalers who, in turn, distribute them through their net of retailers. Finally, the retailers sell the goods to the consumers. Since the advent of the industrial revolution in the 18th century, the manufacturing sector has constantly expanded in all types of economies because it produces wealth; in contrast, the service sector consumes economic resources. In the global era, as international opportunities for companies and corporations have increased, a dominant strategy has emerged: The manufacturers based in the developed world are expanding in developing countries where the markets are growing and where labor is cheaper, more flexible, and less unionized. This process has caused concerns in many observers as to Western capacity to maintain its high standard of living as economic growth is peaking in developing countries. This growth, it is argued, will have the effect of attracting manufacturing jobs in developing nations at the expense of Western nations. Such fears are widespread across the globe and the political spectrum. Businessman Ross Perot famously remarked in 1992 that he could hear “the great sucking sound” behind the North American Free Trade Agreement as American jobs were lost to Mexico. The European Union warned in one of its white papers as early as 1993 that the rise of unemployment in Europe was due to the expansion of the manufacturing sector in developing nations. European countries simply could not compete with the low wages paid to laborers in those countries. As corporations increasingly expanded in developing countries, making more tenuous the links with their original countries, moral issues came to be debated alongside economic ones. Naomi Klein has famously written on the devaluing of the manufacturing process in favor of the marketing of the brand in her book No Logo (2000), concluding [Page 1103]that the people in charge of the actual production are progressively more shifted to the side in the image of the goods that corporations want to promote. In this phantasmagoric image, there is no place for the underpaid laborers who have materially produced the goods according to the company's imperative to “make it really cheap.” Corporations are often blind to the fact that in our increasingly globalized world, as stated in the International Labour Organization's 1944 Declaration of Philadelphia, “poverty anywhere is a threat to prosperity everywhere.”

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