The service sector jobs filling the gap carried a pay cut of roughly 20 per cent. Enter the indented disposable worker, stripped of health and pension provisions and working for the minimum.
In 1985, one in eight Americans had incurred an income loss of a quarter or more. By the time of the 2008 global financial meltdown, the ratio was up to one in five, and rising fast.
Between 1990 and 2008 over 27 million jobs were created - almost all in the service sector. These jobs were in the least critical parts of the economy that neither China nor computers had managed to usurp. Increasingly, the economy now demands either very high or very low skills.
The end result is the much referenced widening inequality gap, with all the attendant social pressures now haemorrhaging the American urban landscape. The disenfranchisement of the American middle class, coupled with further alienation of the existing urban poor, has created a network of powder keg communities ready to blow, if they haven't already.
Between 2002 and 2007, the top 1 per cent captured almost two thirds of the economy's growth, while the bulk of the workforce's income declined.
The parallel is often drawn between the decline of the Roman empire and contemporary America. In the first centuries AD, while there was a huge inequality gap between the seriously rich and the vast majority at subsistence level, it's estimated that the gap in Roman times was still less than in present-day America.
The decline of US manufacturing ultimately led to - among other things - the creation of the "rust belt", the decimation of the once most productive industrial enclave on the planet.
The loss of middle class jobs hollowed out whole cities, ultimately self-imploding along with the rating and tax base required to sustain infrastructure.
Many US educational institutions now rely on the foreign student industry to support themselves, with the difference being that the best and brightest no longer want to remain in America after graduation.
Plummeting private and public research and development investment has stifled innovation, and the social meltdowns have resulted in hugely expensive burgeoning vested interest agencies vainly trying to deal with the fallout.
And don't mention the stratospheric incarceration rates, creeping civil militarisation, and trashed environment.
You don't have to look far to see the parallels here. Loss of manufacturing, rise of the minimum wage service sector, reliance on a foreign student industry, burgeoning dysfunction agencies creating vested interest behemoths, record household debt, compromised environment, widening inequality et al.
With all our natural advantages, we seem to have gone out of our way to mimic the dystopias of our supposed champion of the Free World.
Many forget that the critical technological breakthroughs that ultimately underpinned Silicon Valley - the primary star in the US economic firmament - had their genesis in public investment programmes.
