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Guest Essay

Nov. 10, 2025, 5:01 a.m. ET

Credit...Sasha Arutyunova for The New York Times

Dani Rodrik

Mr. Rodrik is an economist who teaches at Harvard University’s Kennedy School and is the author of “Shared Prosperity in a Fractured World: A New Economics for the Middle Class, the Global Poor and Our Climate.”

To reverse the rise of authoritarian populism, the Democratic Party, like left-of-center parties everywhere, must reconnect with the working class. Just as Franklin Roosevelt did 90 years ago, it has to defeat the rhetorical economic populism of the right with a version that delivers. At the heart of that agenda must be a program that spurs not only jobs, but good jobs.

A good job is one that pays a decent wage and provides fair treatment, some degree of autonomy and advancement opportunities. Only about 40 percent of American workers have one. Nearly half of Americans believe they would not be able to find one. Jobs do not just provide income; they are a source of dignity and social recognition. The disappearance of good jobs and, with them, a reliable path to the middle class, underpins the economic anxieties that have fueled the rise of the far right.

Progressives have echoed the right in calling for a revival of manufacturing. This is a mistake. Automation and global competition have killed manufacturing jobs in virtually all middle-income and advanced economies. Manufacturing’s share of employment has broadly continued to fall in the United States, despite strident efforts by Presidents Biden and Trump to arrest it. Today, roughly one in 12 American workers are employed in manufacturing. Putting up trade barriers against China will not work. China itself has lost millions of manufacturing jobs over the past decade and a half.

Economic populism needs two major makeovers. First, it has to start focusing on services, instead of manufacturing, as the main provider of jobs. Second, it has to take aim at technological innovation, deploying government programs to redirect it in a more worker-friendly direction.

Those kinds of ideas are anathema to those who believe Democrats should move to the center. Look at Mr. Biden, the critics say. His economic policies were further to the left than any other president in recent memory. He increased workers’ bargaining power, chastised large corporations and pursued ambitious industrial policies to revive manufacturing. Yet it was Mr. Trump whom voters swept into office in 2024.

But economic populism can take many forms, and it is not clear that Democrats have given it a real chance. Today, we associate economic populism with support for manufacturing and trade protection. But American populists of the late 19th century stood for agrarian interests and against import tariffs. They viewed protectionism as enriching big business and increasing the cost of living for ordinary workers. Populist economic policies need to be tailored to the needs of the moment.

Projections by the U.S. Bureau of Labor Statistics suggest that the nation’s top three private sector occupations well into the next decade will be home health and personal care aides, fast food and counter workers, and retail salespersons. The promise of bringing back manufacturing jobs fails to make a connection with the concerns of the typical worker, who is more likely to be employed as a care giver or in food services.

Those are among the worst jobs in the country, and neither mainstream nor conventional populist remedies offer an adequate remedy for them. Expanding college education is little help since these jobs do not require advanced degrees. Raising the minimum wage and granting greater bargaining power for workers could certainly go some way to improve job quality. But that strategy too has its limits. European countries such as France and Spain have found that raising labor costs to employers can shut out younger, less experienced workers from the labor market, driving up youth unemployment levels.

Sustainable improvements in job quality have to be supported by organizational and technological changes that improve workers’ productivity — their ability to provide better service, undertake more sophisticated tasks and improve customer satisfaction. What might a program for good jobs in service industries look like?

For a glimpse at what is possible, we can turn to the most astonishing productivity miracle of our time: renewable energy. China’s green industrial policies have yielded such a dramatic reduction in the cost of solar power, along with wind power and electric batteries, that even Bill McKibben, the influential activist who has long rung alarm bells on global warming, has come to believe we may escape climate catastrophe. Although the green transition may seem far afield from the good-jobs agenda, we can derive valuable lessons from how China got here.

Since the early 2010s, China has made green technology a national project and prioritized it more than any other nation. While government subsidies played an important role, they were part of a much broader set of policy instruments. China deployed public venture capital, infrastructure investments, regulations and demonstration programs, often in an experimental manner. In contrast to the conventional image of East Asian industrial policy, the approach was collaborative. Beijing articulated broad objectives, but decision-making was both consultative and decentralized, with provinces and municipalities playing important roles. As scholars who have observed these policies closely have noted, the government’s role was less of a central planner than of a “collaborative catalyst.” As befits the experimental nature of many of the programs, the Chinese government revised its policies over time as it learned about developments on the ground.

This approach — government driven yet pragmatic — is the hallmark of successful programs of technological transformation. The United States has done this, too, through the Defense Advanced Research Projects Agency, the Defense Department unit that has funded many crucial projects, as well as agencies in energy and health sciences modeled after it. Such programs stand in sharp contrast to the recurrent claim that industrial policies rarely work, or that they work only for the authoritarian regimes of East Asia.

America has multitudes of successful local economic development partnerships, such as The Right Place, of Grand Rapids, Mich., Greater Rochester Enterprise and the Virginia Economic Development Partnership. Led by civic-minded businesspeople, government agencies or nongovernmental groups, these partnerships operate along lines similar to China’s green industrial policies. They develop a productive vision for the local economy (“what do we want to look like in 20 years?”), coordinate across different agencies and leverage subsidies to the needs of businesses. When James Fallows, a journalist with extensive experience in East Asia, traveled around the United States, he found that the industrial policy he was familiar with from overseas also thrived here.

Building on those local experiments isn’t sufficient to build a good jobs agenda. First, officials thinking about economic development need to get over their manufacturing fetishism. Too often, local efforts focus on attracting large international firms in the hope that they can replace manufacturing jobs long lost. Even when successful, many of those efforts create few new jobs. Valuable local resources — organizational as well as financial — are better spent on development strategies with greater impact, helping small and medium enterprises thrive and improving capabilities of local service workers in care or retail.

Second, as the Chinese and Darpa examples indicate, a good jobs agenda has to be a national project and a federal priority. The Biden administration, to its credit, moved some way in this direction. It established a number of “challenge” programs that encouraged localities to develop plans, in areas including job training programs, conservation projects and industrial development, and funded the winners. Their budgets were a small fraction of the billions spent on the administration’s landmark policies, the CHIPS and Science Act and the Inflation Reduction Act, and they remained in those bigger programs’ shadows.

Most important, we need a national innovation program to spur worker-friendly technologies in service industries. One of the most paralyzing myths of our day is that new technologies, such as automation or artificial intelligence, cannot be controlled. In reality, just as China’s green industrial policies pushed innovation in a particular direction, our digital future can be shaped in ways that benefit workers directly.

The potential of new technologies in services is real, as retail giants such as Amazon and platforms such as Uber have shown. Their deployment has resulted in productivity gains in recent years that rival or surpass what has been achieved in manufacturing. But when innovation remains completely in the hands of private firms, benefits for workers remain limited. Companies have a bias toward technological solutions that limit worker autonomy, concentrate tasks, focus on surveillance and squeeze the greatest surplus out of employees.

In manufacturing, such approaches were superseded by the Toyota production system, which gave workers greater control over the production line. A similar revolution in services will require new technologies that enable workers to undertake a broader range of more sophisticated tasks. There is a precedent in health care, as the Massachusetts Institute of Technology economist David Autor has reminded us, where the development of new medical technologies helped enable nurses to perform tasks that previously only physicians could undertake.

In long-term care, A.I. and other digital tools can help aides perform procedures and exercise discretion in ways they are currently unable to do, giving them greater agency, increasing patients’ satisfaction and saving on hospital costs. In retail, these technologies can allow employees to perform expert, specialized tasks for consumers and contribute in ways that are currently wholly determined by corporate headquarters. In education, new digital tools allow teacher’s aides to customize lessons and evaluations to each student’s learning style. Versions of these technologies already exist and provide a glimmer of what a dedicated national innovation program could accomplish.

We need nothing less than the good-jobs equivalent of the green industrial policies that have been so successful in China: a political project that speaks to and empowers the working class. Existing examples suggest such a path is not a fantasy. It requires political leaders to shed their preoccupation with manufacturing and embrace the kinds of public-private collaboration that drives economic transformation.

Dani Rodrik is an economist who teaches at Harvard University’s Kennedy School and is the author of “Shared Prosperity in a Fractured World: A New Economics for the Middle Class, the Global Poor and Our Climate.”

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