Laird
Member
http://www.economist.com/news/speci...es-are-moving-their-manufacturing-back-united
A growing number of American companies are moving their manufacturing back to the United StatesI suspect Trump knew of this trend and is trying to take credit for it. Promising to cut corporate taxes and regulations is helping too, but that would most likely happen under any Republican administration.
Jan 19th 2013
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But reshoring amounts to much more than public relations. It is being driven by powerful forces and will only get stronger. In a survey of American manufacturing companies by the Boston Consulting Group (BCG) in April 2012, 37% of those with annual sales above $1 billion said they were planning or actively considering shifting production facilities from China to America. Of the very biggest firms, with sales above $10 billion, 48% came out as reshorers. The most common reason given was higher Chinese labour costs.
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Even as pay is rising rapidly in China, costs in America are falling. The successful extraction of natural gas from shale has dramatically lowered the price of energy.
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A fascinating article, Jim. I would highlight this in it too:
The crucial change that has taken place over the past decade or so is that wages in low-cost countries have soared. According to the International Labour Organisation, real wages in Asia between 2000 and 2008 rose by 7.1-7.8% a year. Pay for senior management in several emerging markets, such as China, Turkey and Brazil, now either matches or exceeds pay in America and Europe, according to a recent study by the Hay Group, a consulting firm. Pay in advanced economies, on the other hand, rose by just 0.5% to 0.9% a year between 2000 and 2008, says the McKinsey Global Institute. In manufacturing, the financial crisis actually reduced pay: real wages in American manufacturing have declined by 2.2% since 2005.