Manufacturing wages and Inequality

Perhaps the increase in inequality is partly due to the decline in manufacturing.  If manufacturing pays better and it hires fewer people, then that alone will increase inequality.  Plus, the opportunity cost of service-sector work declines as the local manufacturing jobs dry up.  The opportunity cost of being a barber in a small town in Texas was manufacturing before they closed down the factory and now the barbers get lower wages both because their opportunity cost has declined and because their customers have lower wages too. 
Moneybox:

Susan Helper, Timothy Krueger, and Howard Wial forcefully make the case for manufacturing in a Brookings paper (PDF) where one subject of interest is the seeming existence of a wage premium in the manufacturing sector. At different skill levels, manufacturerers pay more:

What I wonder when people point this out is what they think follows from this. Here's one though. In India, a very large segment of the workforce is doing extremely low wage work in the agricultural sector. And agricultural productivity is limited by the availability of land. So insofar as you're able to subsidize the creation of manufacturing work, not only do the people who get the manufacturing jobs earn higher wages—the residual agricultural population earns higher wages too. This off the farm aspect to industrialization has historically been a huge driver of prosperity and I think it's crucially important for political leaders in developing countries to think about it.