News / USA

    US Jobs Coming Home?

    A worker sews clothes at the Karen Kane clothing company in Los Angeles, California, Jun. 30, 2011. The Los Angeles apparel industry is riding a small but growing wave of incoming jobs as costs in China and India rise.
    A worker sews clothes at the Karen Kane clothing company in Los Angeles, California, Jun. 30, 2011. The Los Angeles apparel industry is riding a small but growing wave of incoming jobs as costs in China and India rise.
    Something strange is happening to the international labor market. Soaring costs and a changing labor environment in Asia have brought back American jobs that moved overseas in recent years. But experts warn that those returning jobs are small in number, and that American companies are still basing the bulk of their production abroad.

    Several leading U.S. companies have announced plans to bring back highly skilled jobs from overseas, expand existing U.S. factories or build new ones. The reasons, they say, are increasing regulations, slower demand, a shortage of skilled labor and significant salary hikes throughout Asia.
     
    Some of the firms bringing back jobs to the US:

    Apple: Investing $100 million, bringing back 200 jobs
    General Motors: Building a $258 data center in Colorado; plans to hire fewer than 10,000 workers
    Oracle:  Restoring 130 jobs from Mexico, retaining 300 in Oregon
    Chrysler: Investing $374 million in transmission factories, bringing back 1,250 jobs to Indiana
    General Electric: Relocating one of its facilities to Georgia, bringing back 400 jobs
    Ford: Investing $200 million, adding 450 jobs in Ohio; moving production from a Mexico facility to Michigan, plans to add 12,000 U.S. jobs by 2016
    In China, factory wages jumped 18.9 percent in 2011 and 20 percent last year, according to the National Bureau of Statistics of China. It projects an increase by more than 9 percent this year.
     
    And China is not the only nation reporting such increases. India is expected to post wage increases of more than 10 percent this year, the Philippines 7.3 percent and Malaysia six percent, according to Aonl-Hewitt, a global consulting firm.
     
    Typically, companies relocating jobs are multi-national firms that are moving “around the margin,” said Andy Tsay, chief of the Operations Management and Information Systems department at Santa Clara University in California.
     
    These companies, he said, make their decisions based on a variety of factors, including the cost of labor, fuel, land and equipment, the proximity of customers and suppliers, the complexity of the product, and the scarcity of skilled labor.
     
    “If you hold all of them equal and … lower the cost of labor in one place, then yeah, it wouldn’t be surprising to see more of the jobs go,” Tsay said.
     
    But Alan Tonelson, a scholar with the Washington-based U.S. Business & Industry Council, said there is another important factor – the “very substantial payments and tax breaks from state and local governments.” This, he said, is enticing many companies to bring jobs back to the United States, set up new factories or expand old ones. 
     
    “That certainly sends signals to companies that it’s going to be a favorable climate for producing in the United States,” added Scott Paul, president of the Alliance for American Manufacturing.
     
    Even so, the local and state tax breaks haven't resulted in an avalanche of jobs returning to the U.S.
     
    One reason is that many modern products are made up of parts made in a variety of countries.
     
    Employees work at a Foxconn factory in Wuhan, Hubei province, China, Aug. 31, 2012.Employees work at a Foxconn factory in Wuhan, Hubei province, China, Aug. 31, 2012.
    x
    Employees work at a Foxconn factory in Wuhan, Hubei province, China, Aug. 31, 2012.
    Employees work at a Foxconn factory in Wuhan, Hubei province, China, Aug. 31, 2012.
    A case in point is U.S. High tech giant Apple, which plans to invest $100 million to manufacture one of its product lines, the iMac desktop computer, in the United States, thereby creating about 200 jobs. But the company’s basic components manufacturer, Foxconn, continues to operate in China with more than a million workers. 
     
    To make a tangible contribution, said Santa Clara University's Tsay, the entire overseas component ecosystem would have to move back to the U.S., along with dozens of companies and the educational system needed to provide them with the people with the right skills.
     
    Short of that, the impact of the incoming jobs on employment or economic growth in the U.S. will be negligible, according to both Tsay and Paul.
     
    U.S. manufacturers added 14,000 jobs in February, according to U.S. labor statistics. But experts such as Tonelson noted that the manufacturing sector is still about three percent smaller than it was at the end of 2007.
     
    “It’s a little bit too early to say that we are seeing some major trends,” said Tsay.
     
    Moving jobs from one continent to another is an expensive undertaking, Paul added, because it could require establishing factories and investing in equipment.
     
    But he was optimistic that more jobs might come back five years from now due to lower U.S. energy costs, rising wages abroad, shifting currency exchange rates and intellectual property theft challenges in Asia.
     
    “If you look at cost factors over the coming decade,” Paul said, “I think that you see the United States becoming even more cost-competitive.”

    You May Like

    Former US Envoys Urge Obama to Delay Troop Cuts in Afghanistan

    Keeping troop levels up during conflict with both Taliban and Islamic State is necessary to support Kabul government, they say

    First Lady to Visit Africa to Promote Girls' Education

    Michele Obama will be joined by daughters and actresses Meryl Streep and Freida Pinto

    Video NYSE Analyst: Brexit Will Continue to Place Pressure on Markets

    Despite orderly pricing and execution strategy at the New York Stock Exchange, analyst explains added pressure on world financial markets is likely

    This forum has been closed.
    Comments
         
    There are no comments in this forum. Be first and add one

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Brexit Vote Plunges Global Markets Into Uncharted Territoryi
    X
    June 24, 2016 9:38 PM
    British voters plunged global markets into unknown territory after they voted Thursday to leave the European Union. The results of the Brexit vote, the term coined to describe the referendum, caught many off guard. Analysts say the resulting volatility could last for weeks, perhaps longer. Mil Arcega reports.
    Video

    Video Brexit Vote Plunges Global Markets Into Uncharted Territory

    British voters plunged global markets into unknown territory after they voted Thursday to leave the European Union. The results of the Brexit vote, the term coined to describe the referendum, caught many off guard. Analysts say the resulting volatility could last for weeks, perhaps longer. Mil Arcega reports.
    Video

    Video Orlando Shooting Changes Debate on Gun Control

    It’s been nearly two weeks since the largest mass shooting ever in the United States. Despite public calls for tighter gun control laws, Congress is at an impasse. Democratic lawmakers resorted to a 1960s civil rights tactic to portray their frustration. VOA’s Carolyn Presutti explains how the Orlando, Florida shooting is changing the debate.
    Video

    Video Tunisian Fishing Town Searches for Jobs, Local Development Solutions

    As the European Union tries to come to grips with its migrant crisis, some newcomers are leaving voluntarily. But those returning to their home countries face an uncertain future.  Five years after Tunisia's revolution, the tiny North African country is struggling with unrest, soaring unemployment and plummeting growth. From the southern Tunisian fishing town of Zarzis, Lisa Bryant takes a look for VOA at a search for local solutions.
    Video

    Video 'American Troops' in Russia Despite Tensions

    Historic battle re-enactment is a niche hobby with a fair number of adherents in Russia where past military victories are played-up by the Kremlin as a show of national strength. But, one group of World War II re-enactors in Moscow has the rare distinction of choosing to play western ally troops. VOA's Daniel Schearf explains.
    Video

    Video Experts: Very Few Killed in US Gun Violence Are Victims of Mass Shootings

    The deadly shooting at a Florida nightclub has reignited the debate in the U.S. over gun control. Although Congress doesn't provide government health agencies funds to study gun violence, public health experts say private research has helped them learn some things about the issue. VOA's Carol Pearson reports.
    Video

    Video Trump Unleashes Broadside Against Clinton to Try to Ease GOP Doubts

    Recent public opinion polls show Republican Donald Trump slipping behind Democrat Hillary Clinton in the presidential election matchup for November. Trump trails her both in fundraising and campaign organization, but he's intensifying his attacks on the former secretary of state. VOA National Correspondent Jim Malone reports.
    Video

    Video Muslim American Mayor Calls for Tolerance

    Syrian-born Mohamed Khairullah describes himself as "an American mayor who happens to be Muslim." As the three-term mayor of Prospect Park, New Jersey, he believes his town of 6,000 is an example of how ethnicity and religious beliefs should not determine a community's leadership. Ramon Taylor has this report from Prospect Park.
    Video

    Video Internal Rifts Over Syria Policy Could Be Headache for Next US President

    With the Obama administration showing little outward enthusiasm for adopting a more robust Syria policy, there is a strong likelihood that the internal discontent expressed by State Department employees will roll over to the next administration. VOA State Department correspondent Pam Dockins reports.
    Video

    Video Senegal to Park Colorful ‘Cars Rapide’ Permanently

    Brightly painted cars rapide are a hallmark of Dakar, offering residents a cheap way to get around the capital city since 1976. But the privately owned minibuses are scheduled to be parked for good in late 2018, as Ricci Shryock reports for VOA.
    Video

    Video Florida Gets $1 Million in Emergency Government Funding for Orlando

    The U.S. government has granted $1 million in emergency funding to the state of Florida to cover the costs linked to the June 12 massacre in Orlando. U.S. Attorney General Loretta Lynch announced the grant Tuesday in Orlando, where she met with survivors of the shooting attack that killed 49 people. Zlatica Hoke reports.
    Video

    Video How to Print Impossible Shapes with Metal

    3-D printing with metals is rapidly becoming more advanced. As printers become more affordable, the industry is partnering with universities to refine processes for manufacturing previously impossible things. A new 3-D printing lab aims to bring the new technology closer to everyday use. VOA's George Putic reports.
    Video

    Video Big Somali Community in Minnesota Observes Muslim Religious Feast

    Ramadan is widely observed in the north central US state of Minnesota, which a large Muslim community calls home. VOA Somali service reporter Mohmud Masadde files this report from Minneapolis, the state's biggest city.

    Special Report

    Adrift The Invisible African Diaspora