Top 3 Reasons American Manufacturing Is Making A Comeback

“Made in America” isn’t just a patriotic catchphrase that is supposed to inspire our consumer habits. Nor is it just a pretty awesome music festival that Jay Z has been hosting in Philadelphia for the past couple of years. For the vast majority of Americans, “Made in America” means opportunity and a good economy. The good news is after decades of disappointment and concern about manufacturing jobs being sent overseas, there are indications that American manufacturing is due for a comeback. From the building of computers to the cold heading of metal parts used in countless appliances, businesses are deciding that it’s worth to bring their operations back to American towns. Here are the top three reasons why we could be entering a renaissance of American manufacturing.

1. Overseas Markets Aren’t as Attractive Anymore

For many years, the story was China was taking all of our jobs. While plenty of manufacturing still occurs in China, it’s becoming less attractive to produce things there. It’s simple economics. While China used to be quite cheap in regards to labor, a middle class is naturally developing there. And with a middle class comes an expectation for higher wages, greater living standards, etc. As things get more expensive in China, it’s becoming cheaper to produce in America thanks to government policies, which is bringing more businesses back.

2. Public Pressure

A key part of running a business well is listening to the consumers when so many of them are clamoring for the same thing: make more products here in America. Public opinion usually leads to public pressure and (in some cases) political action. Take what Apple is doing for example. After so much troubling publicity over their manufacturing operations in China, they’ve committed to building their new line of Mac Pros in America. Ford has recently done similar PR work, making much ado about moving some of their manufacturing from Mexico back into the US.

3. Consumer Demand

Lastly, it’s simple demand that is forcing businesses to reconsider where they manufacture. Polls show that a large majority of Americans, when given the choice between two similar items made here or overseas, would specifically choose the American one. A slightly smaller majority would even be willing to pay more for an item that switched from being made overseas and back to America. There is more money to be made by bringing production back to America. It also has the added bonus of positive news stories about more jobs being available. More than a half million manufacturing jobs have been created over the past few years, which is a reversal of a multi decade trend of America shedding manufacturing jobs on a yearly basis. More factories were opened this year than factories that closed. That hasn’t happened in a long time.

Doing business in America continues to become cheaper. Through innovative processes like cold heading operations, companies are producing key components of a wide variety of machinery faster and for less money than ever before. Combine this innovation with the skill of the typical American worker and the choice becomes a no brainer. Over the next couple of decades, America is going to see a big rebound in its manufacturing capabilities.

James Snyder is a business and economics blogger focusing on labor and federal policy.

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