GREATER PRODUCTION - LABOR INPUT = INCREASED PRODUCTIVITY:

[I]n recent years, factories have been coming back, but the jobs haven't. Because of rising wages in China, the need for shorter supply chains and other factors, a small but growing group of companies are shifting production back to the U.S. But the factories they build here are heavily automated, employing a small fraction of the workers they would have a generation ago.

Look at the chart below: Since the recession ended in 2009, manufacturing output -- the value of all the goods that U.S. factories produce, adjusted for inflation -- has risen by more than 20 percent, because of a combination of "reshoring" and increased domestic demand. But manufacturing employment is up just 5 percent. And much of that job growth represents a rebound from the recession, not a sustainable trend. 

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