Wipe your glasses with what you know.

– James Joyce

The problem with conventional wisdom is not that it’s factually incorrect, but that it leads to the wrong conclusions. As yet another final curtain falls on the paper industry dramas in Millinocket and Bucksport, the conventional wisdom that “those jobs ain’t comin’ back” echoes ever louder. And, taken literally, those words are certainly true. The jobs making the types of paper products Maine’s major mills have been turning out for generations are not coming back. But the extrapolation of that truth into the too often cited assertion that “manufacturing is dead; we have moved into the information age” is dangerously false.

A generation ago – or by today’s standards perhaps two or three generations ago – in 1970, more than 112,000 Maine workers were employed in manufacturing. That total amounted to more than a quarter of the state’s total workforce. The average annual earnings of these workers amounted to approximately $7,000, a total that was a healthy 11 percent above the average earnings of all workers of just over $6,300.

By 2013, total manufacturing employment in Maine had fallen to 55,720, a drop of more than half. As a share of total employment, manufacturing dropped from 25.2 percent to 6.9 percent. That’s a lot of jobs that didn’t and won’t come back. But it doesn’t, in any way, mean that the rest of these jobs will also disappear.

In 2013, the average annual earnings of manufacturing employees in Maine amounted to $63,500. And this average had, since 1970, grown from 11 percent above the average annual earnings of the average Maine worker to fully 44 percent above the overall average – $63,500 for the average manufacturing worker compared to $44,000 for the all-sector average worker. Far from dying, manufacturing in Maine (as is true all across the country) has gotten more demanding, more technologically sophisticated and, most importantly, more rapidly changing and thus requiring a constantly learning labor force. Manufacturing faces many problems in Maine, but imminent death is not one of them.

Conversely, growth of the service sector has not meant a smooth transition into high tech, high wage jobs. In 1970, there were 77,500 service sector jobs in Maine, just over 17 percent of the state total. By 2013, that number had swelled to nearly 345,000 or approximately 43 percent of all jobs in the state. In 1970, the average service sector employee earned less than $4,900 per year, about 23 percent below the all-sector average. By 2013, the average service sector worker earned just less than $39,800, still 10 percent below the all-sector average of $44,000.

I don’t mean to say that all service sector jobs are low-paying (any more than I mean to say that all manufacturing jobs are high-paying). My point here is merely to underline the fact that simple extrapolation of overall trends is unlikely to lead to intelligent public policy. Just as the old-time manufacturing jobs “ain’t comin’ back,” so also the new, high-tech jobs of the future “aren’t comin’ through that door” either.

Indeed, much of the growth in service sector growth over the past 43 years derives not from changes in the labor market but from changes in our population and social policies. In 1970, personal current transfer payments – yes, that pesky welfare and social security (and Medicare and Medicaid) problem again – amounted to approximately $370 million in Maine, just over 10 percent of total personal income. In 2013, that total exceeded $12.5 billion, nearly a quarter of our total personal income. Much of the growth in health care employment – by far the fastest growing service sector over the past four decades – owes its growth to this public decision about how we pay for health care, a decision whose future is anything but certain.

In short, neither dust-smeared nor rose-colored glasses can tell us much about the future.

Charles Lawton is chief economist for Planning Decisions Inc. He can be contacted at:

clawton@planningdecisions.com