Politics

USA TODAY Reports that ?Some Manufacturing Heads Back to USA?

By Karina

House Democrats will continue to work to increase American manufacturing and create new, good-paying American jobs through our ‘Make it in America’ agenda?next week voting on a bill to close tax loopholes that encourage big corporations to ship American jobs overseas. An article in today?s USA TODAY reports that a “growing growing band of U.S. manufacturers are?bringing some production to the U.S. from far-flung locations such as China”:

?A small but growing band of U.S. manufacturers ? including giants such as General Electric (GE), NCR (NCR) and Caterpillar (CAT)? are turning the seemingly inexorable offshoring movement on its head, bringing some production to the U.S. from far-flung locations such as China. Others that were buying components overseas are switching to U.S. suppliers.

Ford Motor said Wednesday that it’s bringing nearly 2,000 jobs to its U.S. plants by 2012 from suppliers, including those in Japan, Mexico and India.

Experts say the initiatives could moderate job losses that have dramatically shrunk the U.S. manufacturing industry. “I think we’re going to start to see a slowing of lost jobs, and we’ll see some jobs coming back,” says Simon Ellis, an analyst for IDC Manufacturing Insights.

?U.S. manufacturers have been frustrated by the sometimes poor quality of goods made by foreign contractors, theft of their intellectual property and long product-delivery cycles that make them less responsive to customer demand.

Several cite the drawbacks of tying up valuable capital in huge overseas shipments, and want to bring assembly closer to engineers, suppliers and customers, concerns that mounted as makers slashed costs in the downturn. Others are simply weary of midnight phone calls ? and multiple annual trips ? to Asia.

?In a June survey by MFG.com, 21% of North American manufacturers said they’d brought production into, or closer to, the continent in the past three months, up from 12% in the first quarter; 38% planned to research such a move in the next three months.

The tide may be easing, if not quite turning. Wages for Chinese factory workers, bolstered by recent strikes, have jumped 15% a year the past decade, Ellis says, but they’re still a fraction of U.S. pay. Shipping costs are up about 71% the past four years as a result of higher oil prices and cutbacks in ships and containers in the slump, says IHS Global Insight.

Within five years?GE plans to move a “significant piece” of overseas appliance production to the U.S., creating hundreds more jobs.

?Onshoring also has been a boon for suppliers. Three supplier trade groups joined forces last year for a marketing campaign to push manufacturers to bring production back to the U.S?

Read the full article»

Full post as published by The Gavel on August 06, 2010 (boomark / email).