“Re-Shoring” Made in America
San Antonio Manufacturers Association (SAMA) - Quarterly Newsletter
by Douglas F. Carlberg
Date: June 19th, 2012
Why U.S. Manufacturers Are Bringing Jobs Back Home
Great companies are forged in the harshest of economic climates. Inspired by challenges, they thrive through innovation and best practices, displaying the flexibility to respond to changing conditions. A trend that exemplifies this approach is re-shoring—the repatriation of manufacturing to America from offshore—which has been growing for about three years.
For several decades, factories (and the manufacturing jobs that go with them) had been moving abroad to countries where labor and materials were cheaper. This trend has been reversing, as companies are building new factories in the U.S. or updating and reopening existing factories. The movement of manufacturing out of the U.S. was called off-shoring, which is the basis for the term re-shoring to describe the current phenomenon.
American companies began producing goods abroad because the costs of materials and labor were lower. Due to changes in the global marketplace and the difficulties involved in doing business from a great distance, these advantages are vanishing. Prices have increased in almost every facet of manufacturing, including raw materials, transportation, and labor. Low or inconsistent product quality also has compromised companies' profits. In addition, the U.S. government is offering financial incentives (such as tax breaks) for companies that do business in America.