Made in America, Again

By: Antonio Regalado, MIT Technology Review Bringing manufacturing jobs back to the U.S. is politically savvy and can make economic sense. At a dinner for Silicon Valley big shots in February 2011, President Obama asked Steve Jobs what it would take to manufacture the iPhone in the United States. Apple’s founder and CEO is said to have responded directly: “Those jobs aren’t coming back.” In December, Apple reversed course, saying it planned to assemble a line of Mac computers in the U.S. With that, Apple joined a wave of companies that say manufacturing in this country makes sense again. Companies that say they’ve brought back jobs include General Electric, Michigan Ladder, and Wham-O, which in 2010 hired eight people to make Frisbees in Los Angeles instead of China. An MIT study in 2012 found that 14 percent of companies intend to move some manufacturing back home.The idea is known as “reshoring.” Although Chinese wages are a fraction of U.S. labor costs, rising shipping rates, quality problems, and the intangible costs of being far from headquarters all add up. That’s why some companies have begun to rethink the manufacturing equation. MIT Technology Review interviewed Harry Moser, head of the Chicago-based Reshoring Initiative, about the trend. Moser, a former industry executive whose family has been involved in American manufacturing for a century, says he grew up “experiencing the glory of U.S. manufacturing.” He created the initiative to help companies compare the real costs of manufacturing at home and abroad, and to track the experiences of those who are returning. Why are people talking about reshoring all of a sudden? It’s actually been happening over the last few years. The obvious answer is that Chinese wages are doubling every four years. The consultants who five years ago were helping people offshore are now helping them inshore. And then you have President Obama making a big deal over how to reduce imports and start making stuff again. How much of Apple’s plan to manufacture in the U.S. is real, and how much is window dressing? There’s a lot of speculation about that. Some people say it’s politics. From what I can tell, the units Apple produces in the U.S....

Fall Trade Shows Highlight New Technologies and Reshoring Initiative

By: Michele Nash-Hoff, Can American Manufacturing Be Saved? The International Manufacturing Technology Show (IMTS) 2012 was held last week (September 10-15, 2012), in Chicago, IL. IMTS is one of the largest industrial trade shows in the world, averaging 1,800 exhibitors and more than 80,000 visitors. The event is held every two years in September at McCormick Place in Chicago. With more than 1.2 million square feet of exhibiting space, the attendees have access to more than 13 miles of aisles showcasing all of the latest technology trends that will be driving the industry through the next decade. New technologies such as additive manufacturing and “cloud technology” were featured at the 29th IMTS as manufacturers pursue new capabilities and efficiency. Plant Engineering reported, “The 2012 event brought manufacturers from all over the world to Chicago’s McCormick Place for the biannual event. The four halls were filled with manufacturers looking for innovations in machine tools, electrical systems, robotics and, for the first time at IMTS, a pavilion devoted to industrial automation.” The 2012 IMTS was the most successful manufacturing show in the U.S. in more than a decade. The more than 100,000 attendees topped 2010 figures by almost 20%. Prior to the show, Douglas Woods, president of the Association for Manufacturing Technology, which sponsored the event, said, “The tens of thousands of attendees who will descend upon Chicago in September for the five-day show are coming because they are looking for production solutions to help maintain that momentum. They want to buy this stuff and put it on their factory floors here in the United States. These people are positive and excited about increasing their manufacturing capabilities.” The Association For Manufacturing Technology represents and promotes U.S.-based manufacturing technology and its members-those who design, build, sell, and service the continuously evolving technology that lies at the heart of manufacturing. Besides owing and managing IMTS, AMT engages the federal government in support of public policy consistent with AMT’s Manufacturing Mandate priorities, business consulting services, and networking events. The show started with an Opening Ceremony on Monday, September 10th with a special appearance from Acting U.S. Commerce Secretary Rebecca Blank along with Illinois Governor Pat Quinn, Douglas Woods, President...

Harry Moser Makes Case for Reshoring at IMTS

By: Plant Engineering Harry Moser, President of the Reshoring Initiative, made his case for bringing back manufacturing back to the United States. “The concept of reshoring and near-shoring (manufacturing in neighboring countries) is equally viable all over the world,” Moser said. He used Brazil as an example of this model and how manufacturing should start in the home country and expand to the region. In the United States’ case, it would include Costa Rica, Mexico, and Canada. Part of the reason, Moser says, that companies are starting to bring back jobs to the U.S. is that many companies are not making as much money as they used to in foreign countries—particularly in China—after the total cost of ownership (TCO) is calculated. “60% of manufacturers, when calculating costs, use rudimentary tools and don’t see the whole benefit,” Moser said. Most companies, he said, were more focused on wage rate and less focused on hidden costs like intellectual property, import/export costs, and potential shortages against demand because of unpredictable variables like shipping. “Who brings the work back? Those who have felt the pain,” Moser said. “Companies that were making a profit at the start and then realized they weren’t making as much shipping their work overseas and weren’t willing to put up with the hassles of calling Asia at midnight all the time and dealing with the logistical challenges.” 50,000 manufacturing jobs have been restored since January 2010, which was the low point for the manufacturing industry. A total of 100,000 jobs (including those affected by manufacturing additions) have been added in the last 30 months. Moser believes if more companies apply TCO, increase the quality of U.S. training, China wages continue to rise, and overseas currency manipulation ends, that a total of 3,000,000 manufacturing jobs could be restored and 6,000,000 overall. “It would wipe out the trade deficit ($600 billion estimated) and it would bring back a lot of quality jobs to the United...