Is Manufacturing Coming Back to the USA?

Ideas and Issues

New Orleans    Sometimes it is hard to determine whether something is really a trend or just more spin, but either way the spike of interest in manufacturing (i.e. jobs!) coming back to the USA is worth close attention.  Perhaps the evidence is circumstantial, but it’s physical and some of it means serious numbers of jobs, and not just any jobs, union jobs.

The largest case in point can be found in Charles Fishman’s story, “The Insourcing Boom,” in The Atlantic which is largely about the decision of General Electric and its high touch, high publicity CEO, Jeffrey Immelt, to invest almost a billion bucks in ramping back up Appliance Park in Louisville to make refrigerators or at least a good part of them in the USA.  Another 1000 union jobs have already come on line on, and it looks like more in the offing.  Fishman was the author of one of the best books ever on Walmart a couple of years ago, so he’s not your run of the mill flack for business.  A companion piece on a smaller scale by James Fallows, also in The Atlantic, made the case for some smaller scale tech jobs being done in the San Francisco Bay Area rather than overseas in China.

In both pieces the pattern that couldn’t be missed is that there are huge efficiencies in combining design with engineering with production that save on the cost of labor and parts when consolidated in one location under one roof in the USA, rather than alienated across the world in China or elsewhere.  Add those pieces together and companies like GE or even these small startups actually save money by being close at hand where they can actually put their arms around the work rather than chasing low wages and cheap materials across the globe.

 Two more pieces of evidence, though perhaps random, have emerged recently.  One was a piece in the Times about the huge 78 ton mining trucks that are made around Decatur, Illinois and exported around the world.  Caterpillar is at least still marginally union though one of the most anti-union, union manufacturers in the country.

Finally, the announcement by Apple’s CEO, Tim Cook, that they were going to make a token, largely symbolic and undefined $100 million investment in manufacturing some pieces of their empire in the US, after former Chairman and Co-Founder Steve Jobs became infamous for insulting President Obama and saying that tech jobs “are never coming back” to America, is a clear sign that even the worst of the lot over at Apple are hearing the sounds of a stampede back to the USA, at least in the media even if not in practice.  Couple this with the concern over the callousness of textile manufacturing and the absurdly flimsy monitoring program that led to the deaths in Pakistan and Bangladesh sweatshop fires, and there’s some small hope that manufacturers are starting to get the message that jobs and products belong in this country and not just chasing low wages around the world.