What’s missing in this equation is the jobs that are created because products are cheaper and better.
Cars today are cheaper in real terms than they have ever been, and more reliable than they’ve ever been. A good part of the reason for that is automation. The result is that people use less of their disposable income in the purchase and maintenance of their car, so they own two cars, and a second car factory is created, providing more jobs. Or perhaps they only have one car, but now they have more money for iPods and travel, creating jobs in the computer and travel industries.
The service industries have been a major area of job growth in the west, for the simply reason that people are now wealthy enough to demand more services. More people get maids to come in a couple times a month. More people get their hair styled more often, or eat out more often, or purchase various entertainments in more quantity.
The main reason labor-intensive goods are being built overseas is because it makes sense to do so. Once you reach a certain level of average wealth, it no longer makes sense to employ highly productive people by sitting them on chairs and having them thread leather needles through running shoe uppers. So we either automate or outsource it.
Instead, we employ people in high productivity jobs that leverage our strengths. Auto workers don’t make $35/hr because of union pressure - as the OP just admitted. So how come an auto worker can command that amount of money? Because his labor is being magnified by millions of dollars in capital investment. A skilled operator controlling a fanuc welding robot is generating a lot more wealth per hour than a semi-skilled worker manually riveting car bodies, or an unskilled worker lugging heavy parts around a plant.
I’ve never understood why the left thinks this is a bad thing. It’s exact what we’ve always hoped we’d become - the smart, rich people in the white coats and suits doing the planning and design and high value stuff, while having our basic needs provided by high quality goods made by people who have not climbed as far up the productivity ladder as we have. But the fact that we’re buying from them is exactly what they need to learn to be productive and join us. That’s what happened to Japan, and South Korea, and Singapore, and Shanghai, and it’s currently happening in India and Indonesia and other places. It’s a win-win situation. The world gets better for everyone when everyone is free to do what they do best and trade with each other for mutual benefit.
But one reason the left doesn’t like this is because the power center of the left is dominated by trade unions, and trade unions lose power as the workforce becomes more skilled and more differentiated. That’s why union power has been declining in the west for decades. It’s not because of the shenanigans of the evil right wing - it’s because unions don’t work very well in a modern information age economy.
Rigid hierarchies and promotion through seniority and pay equality may be fine when every worker is exactly the same, when they’re all just automatons doing the same job on an assembly line. But when people have to exercise judgment and leverage knowledge and be adaptable, unions fall apart. Unionized professionals are a horrible idea.
So the auto workers, and the public union leaders, and the steel workers and the other unions lobby and propagandize about the ‘death’ of American manufacturing, and demand tariffs and barriers against foreign labor. They are the modern labor equivalents of the Luddites in the 17th century who went around destroying powered looms and factories because they were taking away the jobs of weavers.
American manufacturing is not dying. It’s growing (or was until the recession). The number of people employed in it has fallen, but in dollar terms manufacturing itself is just fine. But Americans don’t export running shoes and cheap T-shirts and pocket radios - they export robots and power plants and turbines and engineering consulting services. Americans export the high value stuff, and let the poorer nations do the cheap stuff. Because it is America’s comparative advantage to do so.
By the way, where are these factories that are paying their workers so much? They’re in places like Texas, where they set up to avoid rigid union rules, high taxes, and bureaucracy. Texas maintains a low tax, low regulation, high growth governmental model. This has resulted in job growth and an atmosphere in which highly skilled employees are worth more and get paid more.
So, how do they pay ‘Union-level wages’ to their workers? Well, it’s not a big mystery. For one thing, they don’t have to pay into the vast retirement accounts that American auto-manufactures do, due to decades of union collective bargaining for better benefits including that retirement. My guess is that Toyota pays less in loaded costs per employee than GM or Ford does, and that lets them pay a higher salary. In addition, due to that automation stuff you don’t seem to have a clue about, companies like Toyota and BMW can build state of the art and highly automated plants here in the US which require less workers with higher skills to run them.