CHICAGO, IL. March __, 2016— The hottest topics in the primary election campaign have been the offshoring of jobs and whether to support the Trans-Pacific Partnership (TPP) trade agreement. The Reshoring Initiative’s 2015 Reshoring Report shows that rapid job loss has been stemmed, but there are still huge challenges to bringing back the 3-4 million manufacturing jobs previously lost to offshore.
The report contains data on U.S. reshoring and Foreign Direct Investment (FDI) by companies that have returned or added new U.S. production from offshore. The report includes cumulative data from 2007 through 2015, as well as detailed data for 2015. Overview:The combined reshoring and FDI trends remained strong in 2015, adding 67,000 jobs and bringing the total number of manufacturing jobs brought from offshore to more than 249,000 since the manufacturing employment low of February 2010.
The overall trend was off 6% from 2014 due to: the strong dollar; low oil prices and shipping rates; and most competitor countries having weaker economies than the U.S. Recently, FDI has been stronger than reshoring. Both trends are based on the logic of producing in the local market, otherwise known as localization. Despite the small downturn, for the second year in a row the number of jobs returning to the U.S. remains on par or slightly higher than the number of jobs leaving. By comparison, in 2000-2007, the United States lost, net, about 220,000 manufacturing jobs per year to offshoring. The steady decrease in the number of jobs lost per year, to zero or a net gain, continues to demonstrate and build confidence that reshoring and FDI are important contributing factors to the country’s rebounding manufacturing sector. “We publish this data annually to show companies that sourcing domestically is an increasing trend in the United States,” said Harry Moser, founder and president of the Reshoring Initiative. “With 3 to 4 million manufacturing jobs still offshore, as measured by our $500 billion/year trade deficit, we see potential for even more growth, and we hope this data will motivate more companies to reevaluate their sourcing and siting decisions.” Major Drivers of Reshoring Successes in 2015: Of particular interest are the reasons companies gave for reshoring and FDI. Government incentives, ecosystems/localization, proximity to customers, and a skilled workforce topped the list in 2015. At the same time, companies cited lower quality, supply interruption (this category had the largest increase from last year), high freight costs and delivery as leading problems offshore. Cumulatively, rising wages and total cost have been major drivers in reshoring decisions. Regionally, the trend remained strongest in the Southeast and Texas, but in 2015 the West displaced the Midwest to hold second place for most jobs shifted from offshore. Data for this report comes from the Reshoring Initiative’s library of more than 3,000 published articles, privately submitted reshoring case studies and privately documented cases. The report provides data and analysis in 11 different categories, ranging from the number of manufacturing jobs lost to offshoring, to reasons cited for reshoring, to a breakdown of data by industry, country, region and state. It also includes data on international reshoring and nearshoring trends. Many studies predict an increase in U.S. competitiveness through the year 2020, despite headwinds of the high dollar. U.S. companies can use reshoring trend data to determine where to obtain a greater competitive edge within the global economy. For full details, read the complete report: Reshoring Initiative Data Report: Reshoring and FDI Continue Strong in 2015About The Reshoring Initiative The Reshoring Initiative a not-for-profit organization committed to helping manufacturers recognize the profit potential of utilizing local sourcing and production. We offer many tools and resources to help companies make supply chain sourcing decisions. The Reshoring Initiative’s Total Cost of Ownership Estimator® is the best-known publically available tool for this purpose. It uses advanced metrics that allow users to easily determine the total cost of offshoring by accounting for and understanding the relevant offshoring costs, which include inventory carrying costs, shipping expenses, intellectual property risks and more. Visit www.reshorenow.org/tco-estimator/.
A 49-year manufacturing industry veteran and retired President of GF AgieCharmilles, Harry Moser founded the Reshoring Initiative to move lost jobs back to the United States. For his efforts with the Reshoring Initiative, he was named to Industry Week magazine’s Manufacturing Hall of Fame in 2010. Additional information on the Reshoring Initiative is available at www.reshorenow.org. Editor’s Note: If you require source materials for articles that discuss trends in trade (reshoring and offshoring or imports and exports) or skilled manufacturing workforce and how these topics relate to domestic manufacturing, please contact Harry Moser at 847.867.1144 or harry.moser@reshorenow.org. # # #