Chemical Processing magazine is currently featuring an article I authored titled "Manufacturing Chemicals in the U.S. May Provide Significant Benefits."For years, off-shoring appeared to be an irreversible trend. After all, cost of labor drove many decisions to relocate operations and gave developing countries a significant and seemingly unassailable advantage.
However, several factors now are contributing to the decision to re-shore. As energy concerns escalate, re-shoring offers a way to reduce energy and transportation costs. The value of the U.S. dollar has deflated over the last ten years while the values of other industrialized nations’ currencies have risen. In many cases, the United States is a low-cost location for exporting products to other nations. Moreover, labor cost is in flux: wages are rising in developing countries while the increasing flexibility and productivity of the American worker is boosting U.S. competitiveness. Furthermore, advanced manufacturing techniques, which rely heavily on robotics and automation, make labor costs less of a factor than they once were.
INCENTIVE FOR CHEMICAL MAKERS
Studies indicate that some industries have more to gain than others when it comes to bringing manufacturing operations back to the U.S. A 2012 PriceWaterhouseCoopers’ report [1] noted that the chemical industry, among several others, stood to benefit the most from “maintaining or expanding facilities in the U.S. given opportunities and cost incentives to re-shore domestically.”
Please click here to read the article in its entirety.
