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To: ExSoldier
"and force those manufacturers back onto U.S. soil" Useless rhetoric that still doesn't address WHY they left in the first place. Emerson Electric: No thanks, Obama, we're leaving. Posted on ‎11‎/‎20‎/‎2009‎ http://www.freerepublic.com/focus/news/2390941/posts
52 posted on 12/16/2014 11:40:21 AM PST by tcrlaf (They told me it could never happen in America. And then it did....)
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To: tcrlaf

“Until we begin to address, as a nation, why the manufacturing jobs left America in the first place...”

... The US became less competitive (more expensive) than the other options. Also, the total number of manufacturing jobs globally has been declining due to automation.

The US became more expensive due to several reasons, including taxes, regulations and legal costs. Those factors are controllable by Government - The US raised them while competitor countries lowered them.

Other factors are important, skills of workers, labor rates, infrastructure, shipping costs, etc. US labor costs are very high by global standards, but skill levels are also very high, so we are more competitive for some types of manufacturing, than we are for for stitching t-shirts or gluing together sneakers.

Energy is big cost in many manufacturing processes (e.g. cement, steel, etc.).

Interestingly, the fracking and horizontal drilling in the US has made the US relatively more attractive for manufacturing, and new manufacturing investment has started rising in the US over the last few years along with hydrocarbon production - especially for things which are energy intensive and/or labor non-intensive. Many commodities are made directly from oil and gas as their feedstock - plastics, fertilizers, fabrics, etc.

Also of note, is that China is no longer a truly low cost producer - wages have doubled and tripled. The flow of new manufacturing investment began shifting elsewhere over ten years ago, and now there is essentially no growth in new manufacturing investment there. Vietnam, Ethiopia, you name it, have eaten China’s lunch on new low skill manufacturing. The low skill jobs are moving from China, and they have been much less effective at capturing higher skill manufacturing.

If the US were to cut corporate tax rates and enact favorable regulation, we could see a surge in domestic manufacturing - we are well positioned for it. The money would be great, but jobs would grow more slowly than profits and tax revenues, because productivity due to automation is an accelerating trend in manufacturing.


65 posted on 12/16/2014 10:10:37 PM PST by BeauBo
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