Outsourcing of manufacturing jobs has haunted the economy of the United States for decades, but this trend is now reversing with the increasing productivity of American workers. The Wall Street Journal reports, “Though the U.S. is hardly a low-wage country, it has become much more efficient, making it more attractive for global manufacturers.”
Manufacturers have used automation and flexible work practices to make far more goods with the same amount of people. This increased productivity results from ideas which make the unit labor cost of goods lower without reducing wages to the workers. The Journal reports that costs in the United States have declined by 13% over last decade compared with increases of up to 18% in Germany, Canada, and South Korea.
The United States also benefits from lower energy costs from the shale-gas boom that is underway (look for posts on this in the near future — DSK). Logistics and transportation are better in the United States than most countries. Though it goes counter to the prevailing sentiment, manufacturing and United States is growing more attractive to companies around the world.