> Services and healthcare are huge parts of the economy, are our indicators still as valuable?

That's true. But the value of manufacturing doesn't necessarily come from its total share of the economy, as much as it does from its fast responsiveness.

Many services, both on the business and consumer sides, tend to be locked in for fixed contact terms. They also tend to be lumpy, either you buy the service or you don't. In contrast, most goods are purchased on-demand at the time they're needed. And it's easier to cut back gradually over time, by purchasing smaller quantities.

Think of the difference between Netflix and Amazon. Netflix is purchased in monthly increments. It's also all-or-nothing. If a household's belt-tightening they might not cancel their streaming service until they're well into the contraction. In contrast they'll probably immediately dial back how much plastic crap they're ordering from Amazon almost immediately.

So, even if manufacturing was only 1% of the overall economy, the high and fast responsiveness of its output to economic conditions makes it a good canary in the coal mine for the rest of the economy.

If anything the United States has swayed too far into the service sector while ignoring its infrastructure. Without functioning infrastructure you can't have a service economy. Infrastructure requires manufacturing and product.

As long as humans continue to exist in the physical world, take up physical space, and consume physical goods for food, shelter, and comfort, then manufacturing will be a critically relevant part of the economy.

As long as humans continue to eat, agriculture will be a critically relevant part of the economy.

We don't normally look at agricultural indicators like crop yields, arable crop land, rainfall, food prices, and commodity futures because agriculture's a small but critical part of the economy. In modern developed economies, under 5% of the population is employed in farming. So while soybean tariffs may be tragic for soybean farmers, they have little effect on the broader market, just as Bitcoin price crashes may have tragic effects on Bitcoin miners but the broader economy doesn't care. The assumption is that we have enough food, and as long as we continue having enough, metrics about how much food we produce aren't that important for measuring the overall health of economy. This despite those metrics being a critical factor in human population growth for millenia.

Manufacturing is rapidly attaining the same status. We will continue to need stuff for the foreseeable future. However, as long as we have enough stuff, how manufacturers do is not terribly important to the broader economy, because they're a rapidly shrinking source of total spending. In many cases, when they're struggling it's because there's too much stuff and they can't find buyers for their products.

> We don't normally look at agricultural indicators like crop yields, arable crop land, rainfall, food prices, and commodity futures because agriculture's a small but critical part of the economy.

Not just that, but relatively few people (at least in the US; this might be different for other "developed" nations, and is probably very different for "developing" countries) are exposed to the agricultural sector on a day-to-day basis (even in rural parts of the US, for example), which means they probably don't have the intuitive understanding of the agricultural sector necessary to determine whether or not it's doing well. Most people in the financial sector (I'd assume, and have observed) tend to live and work as far from farms as possible :)

Agriculture's also pretty unlikely to be a useful indicator of recession (I'd imagine; I'm no economist) because people need to eat; whether you're eating a meal at a restaurant or a meal you cooked yourself, or whether you're buying fresh or frozen/canned, the underlying agricultural side of that supply chain is gonna be more-or-less unaffected (at least by the supply/demand curve jumbling; loan availability, real estate values, etc. can still negatively impact the ag sector in the same ways they negatively impact other sectors), if not moreso given the typical amount of land required to do farming/ranching at the scale necessary to make decent money from it (so i.e. excluding subsistence and/or recreational/hobbyist farmers).

This leads to two questions:

(1) if it’s a small but critical part of the economy, could it make sense for it to switch to a centralised model?

(2) what happens when we have “enough” services?

1) In agriculture at least it doesn't - many small competing producers can produce a lot more efficiently than one big one with no checks on inefficiency. There's a lot that's fucked up about Big Ag but most of the egregious stuff (like corn subsidies, or small sharecroppers being forbidden to own or save their own seeds because of IP restrictions) would be fixed by more competition and less government involvement.

2) The economy shifts into the next phase of development. I don't know what that'll be - artistic pursuits? space exploration? - but eventually the service industry will face the same fate as manufacturing and agriculture, and we'll move into a new economic era.

> artistic pursuits? space exploration?

Perhaps artistic pursuits in space :)

Humans don't take boredom well. They'll find something to do even after all their needs are fully met.

Art is a service. I’m more curious about what people would do to get any of the things that are currently “the economy” when all needs are oversupplied by, say, a mere 5% of the population in full time work. Would people work less for the same goods? Would there be high unemployment? How do things shift and rebalance? UBI sounds good, but is it politically feasible — some people get called “benefit scroungers” while others are called “pensioners” and “the royal family”?

Communism, mate, that's communism come true.

1) Soviets did this with a mixed success.

2) we'll do something else

1) Soviet example is not useful, because manufacturing wasn’t “minor” back then.

2) what “something” is neither primary production, nor manufacturing, nor services, yet capable of being scarce in a way that could be meaningfully traded for the aforementioned?

If you are talking about agriculture, well, it was a mix of bad and horrible that every other country that adopted communism worked very hard to find a different model.

Manufacturing PMI probably loses its leading indicator status once automation becomes more sophisticated. Many of the sub components of manufacturing PMI (new orders, inventories, etc) completely vanish in importance at that point. Considering there is virtually no inflation anywhere in the world at the moment, there's no incentive for businesses to really invest in this stuff at the scale required to really eliminate the human in the loop.

Powell mentioned the Phillips curve because it's been borderline irrelevant for a while now due to unorthodox global central bank policies.

> 'At what possible point does the manufacturing and physical goods

> lose their signaling status due to a more service based economy?

There was a comic about (sorry, no translation this time...cos -there was another comic about translation P-: )

sry-no-more-hotlinking ^^//deviantart.com/4bigholidays/art/00222-BEEEB-BEEEB-BEEEB-809000483

(-;

I've eliminated entire line items of expenses thanks to software, buying quality and public transit that I feel like improved my life enormously but reduced my consumption a great deal. Less physical goods and effort: better for me.

I’m assuming you’re talking about private app based transit here, not public busses and trains, based on the relationship to software. If that’s true you may be shifting the ownership of the physical goods used to transport you, but as long as they are private (as in no more efficient than a private car from a consumptive standpoint) there are just as many physical goods at play- more if you’re using any of the last mile scooter/bike/non-durable options out there

OP is likely referring to Google Maps Transit, One Bus Away and similar bus/train tracking apps making public transit predictable and usable for their lifestyle, not the piecework economy of private taxis like Uber & Lyft.

Once (if they ever) become non-scarce.