Reshoring News: June 2019
The Reshoring Initiative shares its 2018 data report, production moves from China but maybe not to Southeast Asia, and more reshoring news.
The Reshoring Initiative tracks news related to the return of manufacturing jobs to the United States. Here are recent news items the Reshoring Initiative has shared:
The 2018 Reshoring Initiative Data Report shows that the number of companies reporting new reshoring and foreign direct investment (FDI) was at the highest level in history, up 38% from 2017. The combined reshoring and related FDI announcements totaled more than 145,000 jobs, the second highest annual rate in history. Including upward revisions of 36,000 jobs in prior years, the total number of manufacturing jobs brought to the United States from offshore is more than 757,000 since the manufacturing employment low of 2010.
Allowing for a two-year lag from announcement to hire, the cumulative announcements since 2010 have driven 31% of the total increase in U.S. manufacturing jobs during that period and 3.3% of total end-of-2018 manufacturing employment of 12.8 million.
The Reshoring Initiative largely attributes the increases to greater U.S. competitiveness due to corporate tax and regulatory cuts. Similar to the previous few years, FDI continued to exceed reshoring in terms of total jobs added, but reshoring has closed most of the gap since 2015.
The Reshoring Initiative’s 2018 Reshoring Report contains data on U.S. reshoring and FDI by companies that have shifted production or sourcing from offshore to the United States. The report includes cumulative data from 2010 through 2018, as well as projections for 2019. The numbers demonstrate that reshoring and FDI are major contributing factors to the country’s rebounding manufacturing sector.
“We publish this data annually to show companies that their peers are successfully reshoring and that they should reevaluate their sourcing and siting decisions,” said Harry Moser, founder and president of the Reshoring Initiative. “With 5 million manufacturing jobs still offshore, as measured by our $800 billion/year goods trade deficit, there is potential for much more growth. We call on the administration and Congress to enact policy changes to make the United States competitive again. Our Competitiveness Toolkit is available to help quantify the impact of policy alternatives, including a stronger skilled workforce, continued corporate tax and regulatory reductions as well as a lower U.S. dollar.”
Here is some other reshoring news:
- Southeast Asia may not be the next ‘factory of the world’ even as production moves away from China. Sixty percent of American multinationals are ready to move production closer to their end markets, according to a Bain & Company study. That study also predicts that production of goods for non-Chinese consumers will move closer to their target markets.
- Taiwan Tech Homeward Bound from China. Rising labor costs, individual censorship, environment taxes and social welfare costs have prompted 40 Taiwanese companies to invest $6B to move manufacturing back to Taiwan from China. "It's not so much about Trump, but about Xi Jinping," who is seen as creating a bad business environment.
This news originally appeared in the Reshoring Initiative’s e-newsletter, which is sent about six times per year. For more news like this, subscribe here.
