Has the decline of knowledge work begun?

What I worry a lot more instead is how knowledge of manufacturing and engineering could be lost due to our greed.

Typical scenario: Industry I is not doing fine in country C (i.e. the fund managers are not happy about lack of growth of the public companies in this sector) due to reasons R1, R2, ..., Rn. Then management decided to outsource and eventually dismantle the factories to "globalize" it. Knowledge retained by the older generation of engineers, technicians and workers were completely lost when they passed away.

I think about this often and it bothers me a lot.

I think the same can happen for knowledge work. Country A ends up turning into a bunch of managers outsourcing to Country B, and then at some point Country B realizes they can manage themselves. Companies are quite literally training their future competition. Once it reaches a tipping point, I don’t think it’s easy to reverse.

I don't think that's ever really happened. If you look at GDP per worker the closest anyone has gotten to the West is Japan & South Korea at roughly 3/4 the production of France.

They can take over existing industries like autos because they do it for cheaper. They can compete in niches for innovation. But they are all capped by structural issues that will prevent them from matching the economic innovation of the west.

I think GDP is a biased indicator when states are competing with each others. Industrial output makes more sense IMHO.