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Blue-Collar Burgers: Bu$hCo. Reclassifies 'Manufacturing' Jobs

Manufacturing jobs making things like airplane engines, cars and farm equipment are disappearing from the American economy.

Or are they? According to a White House report, new manufacturing jobs might be as close as your nearest drive-thru.

The annual Economic Report of the President has already stirred controversy by suggesting the loss of U.S. jobs overseas might be beneficial, and predicting that a WHOPPING [get it? - heh . . .] 2.6 million [Mc]jobs will be created in the country this year.
Is cooking ^this^ a manufacturing job, like assembling automobiles?
Is cooking ^this^ a manufacturing job, like assembling automobiles?
Building Blue-Collar ... Burgers?

NEW YORK, Feb. 20, 2004
 http://www.cbsnews.com/stories/2004/02/20/politics/main601336.shtml

(CBS) Manufacturing jobs making things like airplane engines, cars and farm equipment are disappearing from the American economy.

Or are they? According to a White House report, new manufacturing jobs might be as close as your nearest drive-thru.

The annual Economic Report of the President has already stirred controversy by suggesting the loss of U.S. jobs overseas might be beneficial, and predicting that a whopping 2.6 million jobs will be created in the country this year.

As first reported by The New York Times, the fast food issue is taken up on page 73 of the lengthy report in a special box headlined "What is manufacturing?"

"The definition of a manufactured product," the box reads, "is not straightforward."

"When a fast-food restaurant sells a hamburger, for example, is it providing a 'service' or is it combining inputs to 'manufacture' a product?" it asks.

Manufacturing is defined by the Census Bureau as work involving employees who are "engaged in the mechanical, physical, or chemical transformation of materials, substances, or components into new products."

But, the president's report notes, even the Census Bureau has acknowledged that its definition "can be somewhat blurry," with bakeries, candy stores, custom tailors and tire retreading services considered manufacturing.

"Mixing water and concentrate to produce soft drinks is classified as manufacturing," the president's report reads. "However, if that activity is performed at a snack bar, it is considered a service."

The report does not recommend that burger-flippers be counted alongside factory workers.

Instead, it concludes that the fuzziness of the manufacturing definition is problematic, because policies like, for example, a tax credit for manufacturers may miss their target if the definition is overly broad or narrow.

But reclassifying fast food workers as manufacturing employees could have other advantages for the administration.

It would offset somewhat the ongoing loss of manufacturing jobs in national employment statistics. Since the month President Bush was inaugurated, the economy has lost about 2.7 million manufacturing jobs, according to the federal Bureau of Labor Statistics. That continues a long-term trend.

And the move would make the growth in service sector jobs, some of which pay low wages, more appealing. According to government figures, since January 2001 the economy has generated more than 600,000 new service-providing jobs.

The annual economic report most of which consists of charts and statistics has been the focus of unusual scrutiny this year, perhaps reflecting the presidential campaign and concern about the lack of job creation despite an ongoing recovery.

The report first touched off a furor with a statement regarding the "outsourcing" of U.S. jobs overseas, where wages are lower.

"When a good or service is produced at lower cost in another country, it makes sense to import it rather than to produce it domestically. This allows the United States to devote its resources to more productive purposes," the report read.

The statement, which reflects standard economic theory about the efficiencies of trade, was denounced by Democrats and Republicans alike.

"These people, what planet do they live on?" asked Democratic presidential candidate and North Carolina Sen. John Edwards.

Even Republican House Speaker Dennis Hastert wrote to the White House protesting at the claim.

The president's top economic adviser and the lead author of the report, Gregory Mankiw, replied to Hastert that "My lack of clarity left the wrong impression that I praised the loss of U.S. jobs."

Critics of the White House also seized on a chart in the report that suggested the administration expects 2.6 million new jobs by the end of the year.

"I've got a feeling this report was prepared by the same people who brought us the intelligence on Iraq," said Democratic presidential candidate John Kerry, a Massachusetts senator.

The White House insisted the figure was just an estimate.

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Saturday, February 21, 2004

Manufacturing McDonald's?

By James Toedtman
Chief Economic Correspondent
 link to www.newsday.com

Washington -- White House economists wonder whether hamburger flippers at fast-food restaurants should be considered manufacturers.

Not a chance, said Edson Pardo, manager of the McDonald's around the corner from the White House. "We don't flip hamburgers," he said. "We just heat them up."

President George W. Bush raised the issue in his annual economic report.

In the report last week, Bush's chief economic adviser N. Gregory Mankiw called the definition "somewhat blurry" and asked whether it should be changed. "When a fast-food restaurant sells a hamburger, for example, is it providing a 'service' or is it combining inputs to 'manufacture' a product?"

For an administration that has seen 2.6 million manufacturing jobs vanish since January 2001, raising the possibility of changing how manufacturing jobs are classified has provoked a sharp response, especially in an election year.

When Mankiw's remarks came out this week, Democrats had a field day.

"If fast food is classified as manufacturing, perhaps the neighborhood lemonade stand should be considered part of the military-industrial complex," said Sen. Charles Schumer (D-N.Y.).

In Ohio, presidential hopeful Sen. John Kerry (D-Mass.) said: "If this president is going to tell middle-class factory workers that even though their job has disappeared, they can still have a good manufacturing job at $5.15 an hour at McDonald's, let him come to Ohio."

The White House McDonald's, whose customers include many White House staffers, though no president since Bill Clinton, is an economic indicator of its own. Business has been slow and Pardo doesn't anticipate new jobs any time soon. "Maybe this summer," he said.

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Feb. 19, 2004, 10:39PM

Fast-food jobs hard to qualify

Category affects possible tax break

By DAVID CAY JOHNSTON
New York Times
 http://www.chron.com/cs/CDA/ssistory.mpl/business/2411774

 link to www.nytimes.com

 http://www.nytimes.com/2004/02/20/business/20jobs.html

Is cooking a hamburger patty and inserting the meat, lettuce and ketchup inside a bun a manufacturing job, like assembling automobiles?

That question is posed in the new Economic Report of the President, a thick annual compendium of observations and statistics on the health of the U.S. economy.

The latest edition, sent to Congress last week, questions whether fast-food restaurants should continue to be counted as part of the service sector or should instead be reclassified as manufacturers. No answers were offered.

Gregory Mankiw, chairman of the president's Council of Economic Advisers, which compiled the report, did not respond Thursday to a request for an interview. The White House press office also had no comment.

Counting jobs at McDonald's, Burger King and other fast-food enterprises alongside those at industrial companies like General Motors and Eastman Kodak might seem like a stretch, akin to classifying ketchup in school lunches as a vegetable, as was briefly the case in a 1981 federal regulatory proposal.

But the presidential report points out that the current system for classifying jobs "is not straightforward." The White House considered this section of the report important enough to draw a box around it so it would stand out among the 417 pages of statistical tables and dry text.

"When a fast-food restaurant sells a hamburger, for example, is it providing a 'service' or is it combining inputs to 'manufacture' a product?" the report asks.

"Sometimes, seemingly subtle differences can determine whether an industry is classified as manufacturing. For example, mixing water and concentrate to produce soft drinks is classified as manufacturing. However, if that activity is performed at a snack bar, it is considered a service."

The report notes that the Census Bureau's North American Industry Classification System defines manufacturing as covering enterprises "engaged in the mechanical, physical or chemical transformation of materials, substances or components into new products."

Classifications matter, the report says, because among other things, they can affect which businesses receive tax relief.

"Suppose it was decided to offer tax relief to manufacturing firms," the report said. "Because the manufacturing category is not well defined, firms would have an incentive to characterize themselves as in manufacturing. Administering the tax relief could be difficult, and the tax relief may not extend to the firms for which it was enacted."

David Huether, chief economist for the National Association of Manufacturers, said he had heard for several years that some economists wanted to count hamburger flipping as a manufacturing job, which he noted would result in statistical reports showing many more jobs in what has been a declining sector of the economy.

"The question is: If you heat the hamburger up are you chemically transforming it?" Huether said.

His answer? No.

Yup, they got that manufacturing right 21.Feb.2004 14:08

worker

They forgot manufacturing reports and manufacturing news and other important stuff we need to survive. Best of all they are manufacturing the rosy state of the economy and the number of Americans with real-wage jobs.