Excerpt taken from Rock Center http://rockcenter.msnbc.msn.com/_news/2012/01/14/10156162-made-in-america-trend-against-outsourcing-brings-jobs-back-from-china#.TxXUxnX_eE4.twitter
The United States may be on the verge of bringing back manufacturing jobs from China.
Harold Sirkin, along with Michael Zinser and Douglas Hohner (all experts from the Boston Consulting Group – a leading management consulting firm), says that outsourcing manufacturing to China is not as cheap as it used to be and that the United States is poised to bring back jobs from China. The three consultants first reached this conclusion in a recently published study titled “Made in America, Again: Why Manufacturing Will Return to the U.S.”
Many companies, especially in the auto and furniture industries, moved plants overseas once China opened its doors to free trade and foreign investment in the last few decades. Labor was cheaper for American companies – less than $1 per hour according to the BCG report. Today, labor costs in China have risen dramatically, and shipping and fuel costs have skyrocketed. As China’s economy has expanded, and China has built new factories all across the country, the demand for workers has risen. As a result, wages are up as new companies compete to hire the best workers.
“The tilt is now getting lower,” Sirkin says. “We think somewhere around 2015 it’ll look flat and may start to tilt in the U.S. favor at that point in time.”
By 2015, it will only be about 10 percent cheaper to manufacture in China.
“We have to recognize one thing,” Sirkin told NBC’s Harry Smith in an interview to air on Rock Center with Brian Williams. “The average Chinese worker is about a quarter as productive as the average U.S. worker.”
“It’ll be a major impact. Our projections are, when you take the manufacturing jobs and then the service jobs that get created alongside those, that we will add two to three million jobs to the U.S. workforce.”
The U.S. is already seeing examples of this – starting in Lincolnton, North Carolina.
Rodon's Commitment to American Manufacturing
Since 1956, we have made billions of american made products in our 125,000 square foot facility, including manufacturing over 30 billion parts since 1992 for the K’NEX building toy system. With over 105 injection molding presses, we are one of the largest family-owned and operated injection molders in the United States. K’NEX is the only U.S. construction toy company, with over 90% of its parts manufactured right here at Rodon.
“At K’NEX and Rodon, we’ve learned that manufacturing in America can actually be more cost effective than manufacturing overseas,” said Michael Araten, President and CEO of both K’NEX Brands and The Rodon Group. “We are thrilled to make this kind of quality, cost effective domestic manufacturing available to other businesses looking to eliminate the risks of offshore sourcing.”
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