U.S. manufacturing to see halting of outsourcing trend

May 7, 2012

The outsourcing of manufacturing operations began in the 1970s, according to an article in the Minneapolis Post, as the high-paying jobs in the steel, textile, electronics and automotive industries moved first to Latin America and then transitioned east to Asia.

According to the news outlet, this move was first dubbed "a global race to the bottom" due to the decline in pay and deteriorating work conditions as the jobs were moved out of America. However, as the jobs are being brought back to the U.S., manufacturing positions are once again highly-sought and a boost to the middle class.

This "reshoring" of manufacturing has occurred due to the rising fuel and productivity costs, an increased pay scale for global labor and a resurgence of American pride. The policies that have been put in place have also benefited the industry and many experts have pointed to a sustainable growth in the sector for the near future.

According to the Post, several key American manufacturers have brought jobs back from Asia and Latin America in the past few years, and this has motivated other companies to alter their business strategy to favor this trend.

Large corporations like Caterpillar and Master Lock are moving operations back to the U.S., as they are buildings a $120 million plant and adding 300 jobs to American payrolls, respectively. General Electric also recently decided to invest $93 million for a new "green" refurbishing plant in Indiana in order to accommodate 700 new positions.

With names like the American investment campaign, the move back to the U.S. has been also seen as a patriotic action for these companies, as they advertise helping Americans find jobs during these turbulent economic times. 

This patriotic push has been supported by President Obama and his administration. The commander-in-chief has spoken to the necessity for a strong manufacturing sector and has highlighted several economic incentives for American companies to bring work back.

CNN Money reported that this growth in the American manufacturing sector is currently outpacing the amount of investment capital available in the U.S. A new survey highlighted how 26 percent of companies lacked the money to grow their operations in the next year.

According to the news outlet, they needed money to hire more workers, buy new equipment and expand their marketing campaigns.