Offshoring is the relocation of a company or business process from one country to another. It's no secret that the United States has fallen victim to offshoring and seen millions of manufacturing jobs moved overseas for cheaper labor and other cost efficiencies.
However, Made in America seems to be making a comeback. The number of manufacturing jobs returning to our country or being started here has been steadily increasing. According to a study from the Reshoring Initiative 60,000 manufacturing jobs were added in the United States last year in comparison to 12,000 in 2003. Also found in the study was that 50,000 jobs were offshored last year in comparison to 150,000 in 2003. The net increase of 10,000 was the first net gain our country has seen in more than 20 years.
One of the major reasons for increased manufacturing in the U.S. are increased wages in traditionally lower-cost countries. Typically as countries develop their labor costs increase over time. Another driver bringing manufacturing back the states are companies' desires to help meet consumer demand and have the ability to manufacture their products closer to where the customers are.
The post-World War II manufacturing days are behind us. But manufacturing in the United States of America isn't dead. As traditionally lower-cost countries continue to develop it makes American manufacturing and a skilled labor force that much more attractive.
Ethan Wade, Financial Advisor
(This article contains the current opinions of the author but not necessarily those of Brighton Securities Corp. The author's opinions are subject to change without notice. This blog post is for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities).