this is the wonderful time of the year when walmart becomes the thunderdome. right now members of the geek squad with r huddled in the corner frightened for their lives. keep in mine, people are doing this to celebrate the birth of jesus. look at this. this is a good one. >> man, that's ugly. >> "your bottom line" starts right now. thanks, randi. see you at the top of the hour. good morning, everyone. i'm christine romans. a painful election is behind us. now the hard work begins. creating middle class jobs. it used to be a ticket to the middle class was by making things. but what are we making these days, and where is the middle? take a minute to look around your living room. your tv, the jaens you're wearing, the lamp next to you, all of those things likely aren't made in the usa. it's a trend, of course, long in the making but made worse by the great recession. when more than 2 million manufacturing jobs were lost. since june 2009 when the recession ended, just

241,000-of-those manufacturing jobs have come back. that's according to government data. for years, for years, conventional wisdom was we don't need to make stuff here. we'll invent it in america and then become a service-based economy. well, here we are, and these new service sector jobs aren't paying off, literally. right now a job in the leisure and hospitality sector averages $13 an hour. that's $27,000 a year, if you work full-time. retail, not much better. average hourly rate, about $16 an hour. this is the average. it takes into account everyone from the store manager to the stock boy. let me show you one tier higher, manufacturing. bringing in almost $24 an hour on average. that's a solid $50,000 a year. that's also the median income for u.s. households. education and health services, these are important jobs for society. workers there earn an average of $24.28 an hour and also around 50 grand a year. again, if you work fulltime. then there's the very top.

those are highly educated, highly skilled and highly motivated. census data show the top 20% making six figures, pulling in almost half of the income in the u.s. for this american recovery to work we need to have a middle, a big, prosperous happy middle. don't you think? it has defined generations of americans. the question is how do we get there? peter morici is a professor of international business at the university of maryland and former director at the u.s. international trade commission and peter navarro is the author of "death by china the "and john doggett is a professor at the university of texas at austin. professors, thanks for joining me. let's get to school. let's get to the lightning round. 25 seconds or less. what is your number one way right now to grow middle class jobs? peter morici, you get to start. >> develop more domestic oil and gas and address the trade balance with china. together if we did those things we'd create 5 million jobs.

both areas require skilled workered, pay high wages and use domestic materials and as a consequence we could easily grow the economy. 10 million jobs. grow at 4% to 6% a year for the next three years. professorial, definitely 50 seconds. john, what about you? >> we need to build big and heavy things that are hard to ship and expensive to ship. there's a company calledenergex in michigan building wind turbine blades with composites doing a good job. big heavy things will hire a lot of americans. >> peter navarro, your turn? >> let's start this week. instead black friday, let's have red, white and blue friday, stop buying made in china stuff, tell our friends to stop buying made in china stuff. tell the stores to start stocking made in the usa. >> peter naff voe, i'll stick with you on that idea. i go a little crazy this time of the year because i'm told the

u.s. economy is driving the u.s. economy. 75 misof economic activity. maybe that's not a good economic model if we're sending people out with borrowed money and saving. the same people going out and shopping this past week are the same people they don't have enough money to save for college. how do we change that dynamic? >> high irony there. what i try to do, christine, is have people connect the dots between buying cheap made in china cheating products and the loss of their jobs, loss of our manufacturing base, the logs of our tax base, and by the way, few pennies of every dollar we spend there at the great wall of mart is going to build a very powerful military in china that is going to challenge our pacific fleet soon, so if we connect the dots or change our behavior. >> come on, peter. >> we really need to make red, white and blue friday instead of black friday. >> you can grow america without demonizing china.

china has its own national interests and strategy. what's ours? john, without -- what does america do? >> you know what, we have to do is stop whining and complaining and blaming china for the fact that we don't make things that americans want. if we make better products which have a higher quality, america is going to buy it. the other thing that is going on that peter doesn't talk about the prices, the wages for workers in china, the cost of doing business in china is requesting up significantly. we can now make things in america as cheaply as it can be made in china. let's look at a. perfect example is a. apple could increase the price of all of its products by $5 or $10 apiece and can bring all that manufacturing from china back to the united states. >> why don't they? >> because right now the new ceo is trying to do that and my guess that time next year there will be a lot of new manufacturing in the united states of apple approximate because apple can afford to raise the price. >> i think you're right. when you look, i think you're right, john, that they can afford to. i also think they have made big

investments ore seas and the shareholders are making a fortune. here's the thing, and i'm going to bring peter morici in it. john is talking about applizing american companies and thinking like a. the issue here is when you're making everything some place else, the people who win are the people who invent those things and the people who invest in those things and the consumers who buy them cheap, it's not the workers. >> absolutely. you know, the real problem though is that not everybody can be an inventor and engineer, and in manufacturing, and in any area, the engineering aspect of things creates a lot of value, but it doesn't use a lot of people. you simply employ many more people making apple products than you do design is the actual iphone itself. that's why it's so valuable and creates so many profits. >> so if you're peter morici in the middle, education and income, you're in the middle, where do you find a job in the labor market today? >> you're not one of the inventors but you have more

education. you maybe have a college education. what if you're average in america today? >> the trick is you can't have average anymore. can't be someone with a liberal arts degree and expect to go out and make $155,000 a year. have you to get some kind of specialized skill. it doesn't necessarily skill mean investing in a four-year college education. does mean going to a trade or technical school or community college, learning how to do something in the health care sector or in manufacturing that requires a specialized skill. simply, we need -- you need a starting point in the labor market and that's how you get it. >> okay. final thought from each of you. can we have an american recovery, another lightning round, can we have an american recovery without manufacturing jobs, good paying manufacturing jobs, peter navarro? >> no. >> john doggett? >> no way. >> peter moric sgli no, and peter navarro is right. unless we address china's cheating on the system you can't compete with them. need a level playing field to create those jobs. >> gentlemen, professors, thanks for spending your saturday

morning outside of the classroom with us. >> have a good weekend, everybody. >> our pleasure. >> hope you enjoyed the seminar. >> the television you're watching me on was probably not made anywhere near where you're sitting, but i'll show you one company that's found it's cheaper to assemble in the usa than in general. just like john doggett was talking about. first, guess the answer to this question. which percentage of u.s. households own an hdtv? 29%, 49%, 69% or do 89% of households own an hdtv? the answer right after this. ♪

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in 2006 only 17% of american households owned an hdtv. they were big. they were expensive and they were rare, right? everybody wanted one. now guess what, 69% of you have one of them. it's because they cost less, right, and they cost less now because in part they are made overseas. just one example, but today we're taking a very hard look at the u.s. economy and asking

where's the middle? where is manufacturing in this country, and can we have a recovery without it? where's the middle in this country, hard to find frankly. countries like china are trying to grow their middle class and are doing that by making things that the companies are selling then to our middle class and that's taking jobs from american shores and our own trade practices are to blame. take a look at this chart. the trade deficit with china has displaced more than 2 million jobs. the stdata from a left-leaning think tank. job losses were in computers and electronics. more than a million jobs lost in those industries over the years according epi. other industries hit hard include apparel, accessories and fabricated medals, textiles and furniture and plastics and rub, motor vehicles and parts. some companies are starting to see the economics of making appliances in the u.s. makes sense to their bottom line,

that's right. more efficient distribution, better work force oversight. it's turning good business, turning into good business for a company we visited in michigan. this assembly line in canton, michigan, is humming again. it's auto country, but workers like michael cox are building televisions, part of an industry that largely left when manufacturing jobs were outsourced in the 1970s, '80s and '90s. >> lots of things went overseas. nice to see a lot of that stuff come back. a lot of people here need a job and we're willing to do just about anything to work. >> element electronics has reshored an assembly line from asia stateside. the parts are still imported, but large-screen tvs are assembled, checked and packaged in america. >> as consumers want more large-screen tvs, it has created an opportunity to bring that production here to the united states. >> mike o'shaughnessy is ceo and fauner of element. he's determined to create

american jobs. >> you grew up in warren ohio in the 1970s and '80s like i did, you watched jobs leave, and you watched the impact of those jobs leaving on the families and friends that you had. >> but this isn't just sentimental. o'shaughnessy says it's good business, and the math makes sense. >> we studied what our total product costs were. in particular we studies what labor does against duty and freight and other factors, and what we found is that we can produce and assemble tvs here in the united states, and we can do that for about the same cost by introducing some component in larger screen televisions, u.s. labor, u.s. assembly, because it's offset by lower duty and lower freight. >> and assembling these tvs here means better quality control and quicker delivery to retailers like target, walmart and costco. so far element has created 100 jobs here. across the country the number of jobs for skilled factory workers is up 38% since 2005, suggesting

at least some of the millions of outsourced jobs are making a round trip, helping former autoworkers like shelby get back to work. >> if they close my plant, and i was out of a job for two and a half years, so it was kind of hard to find something for a while there, but thank good for here. stuff is being made in america so that's good. >> imagine losing your job at an auto facility and then out of work for two years and now putting together televisions. all right. 23 million americans are struggling to find full-time work, but business leaders say they can't find enough high-skilled manufacturing workers. i'll tell you why they are not looking hard enough. that's next. americans are always ready to work hard for a better future. since ameriprise financial was founded back in 1894, they've been committed to putting clients first. helping generations through tough times.

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to hear corporate executives tell it, the only thing holding back manufacturing in america are americans themselves. good jobs go unfilled because american workers don't have the skills needed to keep up with a fast-paced technology-driven factory floor. 600,000 manufacturing jobs, to be exact, according to one stud fredeloitte, are unfilled because of a skills gap. all that have would be pretty terrifying, right, if it were true. a recent report from the boston consulting group says, quote, trying to hire high-skilled workers at rock bottom rates is not a skills gap. the report estimates that the skills gap actually affects between 80,000 and 100,000 workers, less than 1% of the total manufacturing workforce. the co-author of that report is

also a senior and managing partner of the boston consulting group and also author of the book of "the manufacturing renaissance." thanks for stopping by to talk to us about this. i hear this a lot from executives. we've had people on this program who had people on this program who have said they just can't find the workers. you say they're not looking hard enough. they're not looking hard enough, they're not paying enough, and they're not investing in training enough. is that the answer? >> exactly. what we're seeing is companies who are not paying enough, they're looking at highly skilled jobs, they're trying to pay $12 or $15 an hour to. that's not a skills gap. they're trying to explore, you know, using lower end work force because they want to pay less money. that's not a skills gap. they're focusing on all sorts of other things. they're not doing training. training san important part. a lot of companies took out training in 2008 when the

economy went south and they haven't put it back. you have to train your workers. you cannot just take people off the street and have manufacturing workers. for most of the jobs, it takes two or three months of apprenticeship to get them skilled and companies just don't want to pay that. >> we've heard a lot about companies working with community colleges to try to train workers to have skilled workers. we've talked to, for example, fedex, working with two-year community colleges for machinists. they need them. they're working with the community colleges to make sure they have the right skills. used to be unions did a lot of help with this retraining, something that was in union contracts with big companies and big manufacturers. so whose responsibility is it now? the company worker? the companies? governments? the workers themselves? >> it's got to be the companies who have to do this. they're the ones who need the people. well, individuals can do their own training and can go to community colleges and that's a big plus and that will help them in their employment, but

companies need to make sure they have the skilled work force to do the jobs. that means they'll have to do it. they'll have to build relationships with community colleges so they can make sure the community colleges are training the people for the skills that they need. >> by 2020, this is a fascinating statistic, you estimate that the u.s. will have 875,000 unfilled positions for machinists, welders, industrial machinery mechanics and industry engineers. that's probably because the average age of manufacturing workers is 56 years old. but then you point out just 14% of companies you surveyed are recruiting from high schools. what do american manufacturers need to do to recruit these young workers? because they're going to have a real skills gap, a real worker gap by then. >> exactly. we don't see a very significant skills gap now, but by the end of the decade, it's going to be very severe if manufacturers don't do things. they're going to have to partner with community colleges. they're going to have to go to high schools and they're going to have to put money in training. when you've got a work force whose highest age for these

skilled jobs is 56 years, we're going to see a lot of retirements, so we're looking at something like 875,000 jobs that will go unfilled if we do not start the training now. so while we don't have a skills gap right now that's severe, it will be very severe by the end of decade if we do nothing. >> well, so nice to meet you. come back again. we try to look at this as close as we can because you really can't have a comeback in america without putting the middle back in manufacturing jobs. hal, thanks so much. >> absolutely, christine. coming up, it's black friday weekend. you're trying to score the best deal. what shouldn't you buy right now? what is this the worst time of year to buy? toys, brand name hdtvs, watches and jewelry, or d, all of the above? the answer after the break. you can actually use... sadly, their brother's white christmas just got "blacked out." [ brother ] but it's the family party! really jingles your bells, doesn't it? my gift to you! the capital one venture card!

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apologies if i'm too late to save you from the black friday retail hike machine, but the answer to our quiz on what not to buy this weekend, d, all of the above. on toys, deal news says you'll find better prices in the two weeks before christmas, so just hold out a little longer. brand name hdtvs, you can find deals on third-tier manufacturers, but the brand names, they're best bought in january or february. think super bowl time. and for jewelry and watches, deal news says they're just as expensive now during the holidays as around valentine's day. you're better off buying those in the spring. the truth is the consumerism thrust on us during the holidays is self-destructive. seeing images year after year of americans tripping over themselves to buy stuff they don't need, to pay for it with

plastic, isn't it a little crazy? credit card debt is creeping higher again, up 5% per borrower in the third quarter from a year ago. this is where you accuse me of being the grinch. ♪ you're a mean one mr. grinch ♪ and some of you tell me i'm ebineezer scrooge. and you're right. it's easy to get sucked into the holiday hype. shop, shop, shop. spend, spend, spend. use your credit, hope you can pay it off early in the year. but you know what? there's a price to pay for chasing cheap. we've talked a lot on this show about the loss of american jobs to inexpensive labor markets overseas. inventing here, manufacturing there, paying lower prices for just about everything at the checkout. it's a trap the middle class has fallen into. we want the latest and the greatest, but we don't want to pay too much for it. and this is what it means for jobs. 60% of the jobs that disappeared after the 2008 financial crisis were earners right in the middle.

construction, manufacturing, office management, middle wage jobs. since then, low wage jobs are the jobs coming back. 58% of all the jobs growth in the recovery are jobs you can't buy a house with or send a kid to college on. the middle class is hurting, and to top it all off, it faces the fiscal cliff. many of you count on your income tax refunds to pay off this holiday debt. if we go over that cliff, taxes go up an average of 3,500 a household, that refund is going to be a lot smaller. you won't have that tax refund to pay for all the stuff you don't need right now. the encouraging news, you're not taking the warnings lightly. the national retail federation says about 2/3 of shoppers say the fiscal cliff will affect their holiday spending. that's good. you've gotten the message. and it looks like congress may be getting the message, too. a deal to avert the fiscal cliff is looking more likely. it is. but i've been disappointed by this congress before. millions of americans are counting on you, congress, to save their jobs and their financial futures. do it. we'll all be celebrating like scrooge on christmas morning.