4 Reasons U.S. Manufacturing is Making a Comeback
Tightening margins, wage pressures and a culture that expects an endless supply of cheap, disposable goods have spelt the decline of light industry and manufacturing in many developed economies. Commoditization has left us with a price-led consumer market—people want things cheap and they want them fast. And developing economies have fulfilled this wishlist for some time now.
Increasingly, developed economies have accepted their inability to compete on cost in the manufacturing and light industrial space, and have turned their focus to more ‘strategic’ pursuits. Service, innovation and strategic management rather than production of goods has increasingly become the focus of companies with their roots in developed economies.
But are signs emerging that the pendulum is now swinging back the other way? In the U.S. at least, new ways to compete in this space are being found, and the value of a first-world approach to manufacturing is again being realized.
Amid the doom and gloom of the American economy, the light industrial space is a rare positive note. The U.S. Bureau of Labor Statistics shows the unemployment rate across the manufacturing industry as a whole dropping back to around 9% at the end of 2011, from a high of more than 12% in 2009. Throughout 2011, the statistics have been improving month-on-month, with both separations and mass layoff events decreasing steadily. And, if the issues outlined here are anything to go by, the positive signs could well be the beginning of something bigger.