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Manufacturing Is Officially Coming Home

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Rob Spiegel
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Data says manufacturing is returning
Rob Spiegel   11/22/2013 6:34:12 AM
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It's good to see the anecdotal evidence actually points to a trend that manufacturing is returning to North America.

RogueMoon
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It's called 'on-shoring'
RogueMoon   11/22/2013 10:00:56 AM
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I'm glad there's now a name for the counter-movement to reverse the damaging effects of "off-shoring".   I'll start using it.  "On-shoring". 

Off-shoring was going to be immensely damaging to the American economy in the long term.  This was said after the Cold War ended when the push to Asia began. 20+ years later, it's true.

I'm happy that there's a survey taken and an association to promote on-shoring.  I'm a bit skeptical of the results though.  The categories are right, but the off-shore quality of labor and risk to intellectual property seems to be ranked far too low.  It depends on who was filling out the survey.  If it's the CEO, he'll definitely rank costs above all else.   If it's the guys responsible for the quality, they'll say quality.  If it's the guys in engineering or manufacturing, they'll have a far different take.

At least, the survey got one thing dead-on correct, there's a wealth of trained resourceful people in America struggling to find meaningful work.  Rather than seeking the cheapest labor and tolerating whatever quality comes of it, perhaps its best to invest in the people who stand the most to gain from healthy businesses in their own country making products they use.  

Whatever the reasons be, on-shoring is something to be encouraged.  The pendulum needs to swing back.

TJ McDermott
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Now, let's see a curtailment of H1B
TJ McDermott   11/22/2013 10:39:58 AM
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This is good to see; an all-service oriented economy was not healthy.  I'd like to see primary fabrication (metals) come back too.

With that, I'd like to see us stop importing foreign labor - H1B visas need to be curtailed, not expanded as congress did this year.  They cant discuss increases again when unemployment gets below 5%.

Rob Spiegel
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Re: It's called 'on-shoring'
Rob Spiegel   11/22/2013 11:49:47 AM
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Thanks for the comment RougeMoon. One thing to remember about the study is that it focuses on the electronics industry. I think there's a silent benefit to this trend, and that's the number of companies that decide not to move their manufacturing to Asia in the first place. We'll never know how many companies have decided lately not to move. But it may be considerable.

As for the study, IPC expects to update it annually.

Greg M. Jung
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On Shoring Trend
Greg M. Jung   11/23/2013 9:21:33 PM
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I especially appreciated the point that 'manufacturers are now considering the costs of transportation when they look overseas'.  Not only is this the transportation of personnel to the Asian factories, but also the higher costs of frequently expediting air shipments due to production part shortages in the factory.  As corporate accounting models evolve and better capture these hidden costs, on shoring becomes more attractive.

far911
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Re: On Shoring Trend
far911   11/24/2013 12:14:01 PM
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true

Nancy Golden
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Re: It's called 'on-shoring'
Nancy Golden   11/24/2013 5:54:19 PM
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I agree with your observations, RogueMoon - the categories are all valid but how much weight given to each depends on your viewpoint. I think quality control and the ability to implement design changes in a timely fashion are huge issues with off-shore manufacturing based on my observations and stories of industry practices from a friend who works for a company that distributes electronic products made in China. At any rate - it is a great thing to see the return of manufacturing to U.S. soil and hopefully this trend will continue and create a healthy economy based on consumers become the producers of what they consume.

 

 

NadineJ
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Re: On Shoring Trend
NadineJ   11/24/2013 10:56:06 PM
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Manufacturers have always included the cost of transportation.  It was still less expensive to manufacture overseas.  It's even cheaper to produce in multiple locations for some products.

With labour unions diminishing and stagnant minimum wages in the US, labour costs are now lower.  Manufacturing in the US is cheaper than in the past.

The real issue is the lack of manufacturing skills in the US.  Those jobs left decades ago.  Younger generations don't have to the same abilities and experience in manufacturing in the US labour force.

naperlou
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Re: Now, let's see a curtailment of H1B
naperlou   11/25/2013 9:01:05 AM
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TJ, I agree with you.  I believe that the IEEE-USA does too.  The issue you have with H1B visa is that they were originally designed for fields, such as medicine and basic research, where the world-wide population of proactitioners may actually be on the low side for what is needed.  They became a way to get cheap engineers and programmers.  I have researched this, and what I saw suprised me.  Microsoft is the biggest user of these visas.  They are hiring programmers!! What?  I even saw that they were hiring purchasing managers through this program.  Even if it is kept, it needs a major amount of reform.  At a minimum, it should be tied to actual statistics.

One reason companies do find it useful is the issue of mobility.  A H1B worker is coming into the country with no ties.  That worker can locate anywhere without disrupting their family, etc. beyond the disruption caused by the decision to come to the US in the first place.  American workers are much more settled these days.  Many may have moved over their careers and found that those moves were not really very fruitful.  Younger workers are generally very willing to move.  My wife and I did early in our careers and my son just did it.  Out demographic make-up is changed, though.  Fewer people are willing to make the move.  Companies like IBM, I have noticed (I worked for them in the past) tend not to move people around.  They have a majority of mobile workers and distributed teams. 

A small company that I talked to recently have a near-shoring site in the middle of the country.  They are based in Silicon Valley and have other distributed offices for services.  Their development shop is in this near-shoring location which is cheaper than Silicon Valley, but still a nice place to locate.  This is the answer, I think.

TJ McDermott
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Re: Now, let's see a curtailment of H1B
TJ McDermott   11/25/2013 9:39:33 AM
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WELL stated, Naperlou.

I've gone to the extent of writing my representative and senators, but have only gotten back form responses.  Their responses have steered my voting away from them as a result.

http://www.youtube.com/watch?v=TCbFEgFajGU#t=75

This video, while dated, demonstrates what happens to complex issues.  As you stateed Naperlou, H1B started out with good intents, but has been perverted far beyond what it meant to do.

I'm REALLY glad to see the jobs coming back.

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