Manufacturing is Returning to America

While every politician and pundit has his or her own extrapolation about how this data should be interpreted, the truth of the matter is that manufacturing jobs appear to be making their way back – ever so slowly – to the United States, from overseas and abroad. In September 2012, the Financial Times reported that the American manufacturing index rose 1.5%, a modest figure in comparison to previous years of economic boom. In comparison, European manufacturing contracted for the fourteenth consecutive month in September, and Chinese manufacturing managed (just barely) to remain at its prior, August level. While it would be preemptory to analyze the causes for this re-balancing of manufacturing back to the United States, a lot of it seems to have to do with the sheer caprices and vicissitudes of the global economy.

The People’s Republic of China, long thought to be a never-ending source of cheap manufacturing labor for international companies, has shown unprecedented worker turmoil in recent years. Chinese workers in the Pearl River Delta – the manufacturing cradle of China and a region thought to produce one out of every three manufactured goods on Earth – have gone on strike at IBM and at Top Form International lingerie. Even more recently, a riot broke out at one of Foxconn’s enormous electronics assembly plants in Taiyuan – a factory that employs over 79,000 workers and produces components for many household-name American computer companies – causing the factory to shut down until further investigation.

Secondly, American companies have begun to realize that not only can American workers build products of higher quality than their foreign counterparts; but that in a domestic economy that sees little appetite for bulk orders it makes sound economic sense to eliminate costly overseas supply chains. While U.S. manufacturing definitely remains in “the red zone” as far as potential cuts – especially in regard to potential defense spending cuts – and while September’s manufacturing index rose only after three consecutive months of manufacturing contraction in America, the long-term picture over the next decade looks cautiously optimistic for those who want to rekindle American industrial prowess.

There was a time when America supplied the world with manufactured goods of all stripes and industries. While we have a long ways ahead of us to reclaim that title, it’s a banner that’s worth reaching for. Skilled industrial jobs mean a healthier overall U.S. economy that can compete better internationally as well as satisfy domestic consumption. We’re pretty sure there’s room enough for everybody to agree on that point.

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