A Surprising Fact about American Manufacturing

Those of you who read this blog or are familiar with Tacony Corporation know that we brought production of vacuums back to St. James, Missouri some time ago. We recently brought production  of sewing cabinets from Australia to Chicago, Illinois so we are continuing to support manufacturing in the United States. We were under the impression that China had surpassed us in manufacturing and so posted Bucking the Trend in December of last year.

Imagine our surprise when we ran across an article titled the U.S. still leads the world in manufacturing productivity that describes how America is still number one in manufacturing and that we outproduce number 2 China by a whopping 40%. I'm sure you're thinking how is this possible, after all almost everything we buy has Made in China on the box.

The article goes on to explain that the reason for this is two fold. First, U.S. manufacturers have been ranked near the top in productivity gains for the last thiry years. Second, we've also focused on producing expensive and complex goods (think health-care products, jet engines, etc.) and left low profit margin consumer electronics, clothes, toys, and shoes to other nations.

We have another example of production in the U.S. and why it hasn't moved overseas. Tacony poduces a lot of CDs and DVDs both to sell and to support our many products. Several years ago we determined that we could save a lot of money by bringing the production in house. We bought autoloading duplication equipment and two autoloading thermal printers and the savings have been substantial.

The two thermal printers are made in the U.S. so that falls into the category of expensive and complex goods mentioned above. There is another reason as well that the production is still in the U.S. as opposed to China or even Europe. I asked the vendor why no other companies had tried to copy these excellent printers. They explained that the manufacturer was very aggressive in defending their patents and that they had come up with a specific technology for high quality thermal prining on CDs and DVDs.

 

Comments

[John]

Being number one or two is not the main thing. It is to be kept in mind that whether the goods the countries are producing is cost effective or not. As the rate of a commodity rises the consumers will automatically shift to low cost goods to fulfill their needs. So I think China is doing great in this aspect and their business will flourish more than other countries.

[Debbie]

I too read that article and was struck by the mention that while manufacturing is going up in the US, jobs in manufacturing are not as the process is more hi tech and humans are not needed to man these assembly lines. Jobs in manufacturing are rising slightly as companies become more confident.

[Embroidery Designs]

Interesting one and direct to the point

Thanks

[Account Deleted]

That is the key line: Productivity Growth. These days Americans dont believe in those words because there is no honor in the American economy let alone earning the $. Nobody wants to work for it anymore and no American wants to work jobs that are available.
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