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News 3 Mil Jobs lost to China are returning to the U.S.

  1. Oct 7, 2011 #1
    Link to news article: http://news.yahoo.com/video/us-15749625/overseas-jobs-come-home-26850542.html [Broken]

    Out of an estimated 4.5 million jobs lost to China over the last few decades, upwards of 3 million are returning to the U.S. Cited factors include rapidly-rising Chinese wages, American productivity, and no overseas shipping charges.

    I recall the video saying that American workers can produce up to 4x as much as their Chinese counterparts, but I think most of that is due to performance-enhancing manufacturing technology, rather than inherent productivity for each individual.
     
    Last edited by a moderator: May 5, 2017
  2. jcsd
  3. Oct 7, 2011 #2
  4. Oct 7, 2011 #3

    chiro

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    Correct me if I am wrong, but doesn't China peg the yuan to the dollar?
     
  5. Oct 7, 2011 #4
    I've found most things in life are self-correcting and will find a new balance point when you leave well enough alone. Obviously, you wouldn't want to take that approach to your dirty dishes, but the video article mentioned China's prosperity resulted in increasing wages, which is a large factor in the shift back towards domestic jobs, much the same as high U.S. wages originally caused the trend to offshore and overseas manufacturing.
     
  6. Oct 7, 2011 #5
    Last edited by a moderator: Apr 26, 2017
  7. Oct 7, 2011 #6
    The video report seems a tad optomistic on some areas. Upwards of 3 million are returning to the U.S - that is a projection not a fact, and in what time frame, 1 year, 10 years. And as for overseas shipping charges - that is miniscule compared to distribution costs to individual stores in addition to highway transportation costs from the manufacturing plant to distribution center.


    I would bet that logistics has a part to play here also for certain goods and certainly not all. What the video report does not mention that there is no border to cross, and subsequently no customs clearance delays if your shipment of goods gets flagged to be checked at import. Time factors and secure delivery are not mentioned.

    The written report is most likely more compehensive. News bites keep people watching.

    I close one eye at financial and economic reports such as this. Next week another report will come out that 2 million jobs are being lost oversea due to some other factor.
     
    Last edited by a moderator: May 5, 2017
  8. Oct 8, 2011 #7

    chiro

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    Last edited by a moderator: Apr 26, 2017
  9. Oct 8, 2011 #8
    I know. Not clear. An economist friend says "4 years for parity."

    We'll see.
     
  10. Oct 8, 2011 #9
    thing is, though, it seems like they're just piling on, now. the imbalance is correcting, but there is this extra incentive now to actually punish china. why is that? what has china done to deserve getting a double whammy? one possibility is that they've done nothing, but this is just politicians getting scared of where the US economy is going, so let's start an economic war for our own benefit.

    or maybe it's something else? like maybe retaliation for china trying to move in on our turf and http://www.foreignpolicy.com/articles/2011/05/27/chinas_port_in_pakistan" [Broken] on assets we've spilt blood over?

    what else could this be about?
     
    Last edited by a moderator: May 5, 2017
  11. Oct 8, 2011 #10
    I believe the transportation cost, but not the wages argument. Enormous amounts of China are still that much underdeveloped that it should be easy to build factories.

    This effect probably, IMO, has more to do with that I expect money has become more expensive. With the financial crisis and the local debts, getting the money to build factories must have become more difficult.

    It will probably just blow over. The capacity of the Chinese is just too large to see any real competitive rise in wages any time soon.
     
  12. Oct 8, 2011 #11
    Sound objections. I'll just add that, in spite of the low cost of international shipping, it does entail some logistical drawbacks beyond time lag. You need to contract whole 20' or 40' containers to reach proper cost economies, which isn't good for just-in-time inventory in many cases. Often you'll also need to disemburse full FOB costs (product, shipping and handling, port dues) up front, possibly on a higher unit count than that needed by immediate sales, which is no good for cash flow. In one case I know personally, these two factors combined to require a higher capital need than a third world start-up, financed by a US company, could handle, so the business model became inviable. The product to be imported was made in China; investors are now considering making the units locally.

    At any rate, this isn't the first I've heard of goods becoming once again more economical to source in the US. Been happening with cheap plastics for some time, iirc.
     
  13. Oct 8, 2011 #12
    I think there's more to it than that. As some have mentioned, the U.S. doesn't like it when other countries enact policies which effect our own economy.

    Could be. Then again, that's mostly our fault for handing them the pink slip to our country.
     
    Last edited by a moderator: May 5, 2017
  14. Oct 27, 2011 #13
    I am sorry but many Americans do not work all that hard, especially when it comes to manufacturing or agricultural jobs. Look at Alabama and other southern states- farmers have issues getting people who are *willing* to work hard.

    This brings up the question whether all our socialistic props like unions, minimum wage, health care negatively influence American productivity. Really, if you want to buy shoes for forty bucks you cannot really make them in the US.
     
  15. Oct 28, 2011 #14
    I think that's an excellent question to bring up. It's my observation they do negatively influence American productivity.
     
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