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A factory sits empty. It’s not in the Rust Belt, nor is it part of a manufacturing exodus that has cost the U.S. thousands of jobs. It is a factory in Shenzhen, China, and the American company that once employed Chinese workers is now packing up, coming home and bringing the jobs with them.
John Higgins, CEO of Neutex, an LED lighting company, said it will be cheaper to manufacture in Houston.
“I’ve gotten in fights, I’ve gotten in arguments with CEOs on planes telling me what an idiot I am for coming back,” Higgins told ABC News.
A decade ago, a factory worker in China made 58 cents an hour. Today, wages are more than $ 3.00 and there are predictions of $6.00 an hour by the year 2015. It may sound cheap, but some economists argue when you factor in productivity those wages add up. The Boston Consulting Group argues the American worker combined with technology in the U.S. makes the American worker more than three times as productive as the Chinese worker.
“When you factor in that the American worker is nearly four times as productive, that math quickly adds ups,” said Hal Sirkin, senior partner at the Boston Consulting Group.
Master Lock in Milwaukee, Wis., sent as many as 1,000 jobs overseas in the 1990s and just brought back the first 100. Nat Labs is doing the same, it’s now making dental molds in Florida instead of China and hopes to hire 300 people.
The story is true in Detroit too, where GalaxE.Solutions, a custom software development company, decided to move in, taking over an office building that had been vacant for nearly a decade.
Detroit, of course, is much closer to the company’s American clients than are the workers in Bangalore, India.
Even though a worker in Bangalore makes $20,000 a year and an American worker doing the same job makes between $40,000 and $60,000, CEO Tim Bryan said once other costs are factored in, the economics make balance out.
“This work is coming back to the U.S.; there’s no stopping it,” he said.
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Mr. Obama Is The President of The United States Of America!!!
Posted by: charity | February 23, 2012, 7:55 am 7:55 am
Awesome, been expecting this would eventually happen and glad to see it is. Now it’s time for everyone here to do their part. Look for that Made in USA label and buy those products over the imports. I always choose made in USA first and the better quality and service has always paid off in the long run.
Posted by: pgdion | February 23, 2012, 9:16 am 9:16 am
“Mr. Obama Is The President of The United States Of America!!!” To paraphrase an old saying, what exactly does that have to do with the price of workers in China? THAT’S what moving manufacturing back to the US.
Posted by: MyTake | February 23, 2012, 9:54 am 9:54 am
Obama had nothing to do with it.
Posted by: newcountryman | February 23, 2012, 1:59 pm 1:59 pm
The reasons the writer cited aren’t going away!
They’ll only continue to grow more severe. We can realistically expect this trend to continue. It won’t be the mass exodus we’ve had, but a well-crafted spreadsheet doesn’t lie.
And the crazy up-spiral of oil prices will only further discourage shipping of goods from China to the USA.
Posted by: Optimistic | February 24, 2012, 11:51 am 11:51 am
This man is not to be praised..he’s only doing this because it’s ‘cheaper’ to do it in Houston. These companies have no qualms about sending jobs anywhere…no allegence to USA at all.
Posted by: gdguynbalt | March 22, 2012, 12:28 pm 12:28 pm