The Real Way to Re-Shore American Manufacturing

Re-Shoring- Reversal of outsourcing; the transfer of a business operation back to its country of origin.

The idea of “re-shoring” American manufacturing has recently become a tagline for businesses, and government leaders.  In today’s tumultuous economic climate, millions of Americans have been forced to weather the storm of unemployment, but could re-shoring be the answer to our problems?

Re-shoring is the new term businesses are using to explain the opposite of outsourcing.  That’s right, many companies are actually bringing their manufacturing facilities back to the United States after having outsourced throughout the past decade.  Despite these re-shoring efforts, the number of new manufacturing jobs created is nowhere near the number of manufacturing jobs lost since the 1980’s. In a recent article, Mubin S Khan said, “There is a lot of lost ground. The manufacturing industry’s share of GDP stands at a meager 11.5% – down from 28% in the 1950s – and it employs half the number of people it did in the 1980s.”

In the past five years, companies like Apple, General Electric, and Ford have started building new factories in the US in efforts to re-shore.  This is a positive trend, however many smaller companies are unable to simply open new facilities here in the US.  Many cannot afford to build a new facility, let alone pay for American employees to run a new facility.  On the other hand, larger companies have the revenue to engage in re-shoring but their efforts alone will not create enough jobs to replace every job that was lost.

The definition of re-shoring may be simple, but its execution will not be easy.  The truth is we need consumers to “re-shore” spending.  There is no doubt that when Americans go out and buy products from US manufacturers it helps our economy.  However, to solve the whole problem we need all American consumers to make a conscious effort to buy American every time they shop.  If consumers spent 1% more on American made products, it would create twenty-thousand additional jobs according to ABC News.  Do the math – if everyone spent 5% more on American made products, that’s a million American jobs created!  The only way America can truly begin to re-shore manufacturing is if we re-shore our spending, so the next time you go to the store, will you consider where your purchases are manufactured?

When American manufacturers, large and small, begin to see more revenue, that is when we will see more jobs, a strengthened economy, and a brighter future.