January 19, 2015

Is U.S. Manufacturing Undergoing A Renaissance … Or Not?

A front-page article this week The Wall Street Journal heralded the news that more and more manufacturers are choosing to move operations back to the U.S. after years of sending jobs overseas. The Journal said companies are making these choices because “Wages are stable, for example, while China’s have soared” and “the U.S. energy boom has reduced natural gas prices and kept a lid on electricity costs.” Additionally, “more companies want to protect designs from overseas copycats, keep closer tabs on quality control and avoid potential disruption in supply chains that span oceans.” 

Not everyone agrees with The Journal’s headline, however. In an article headlined, “The False Narrative of the US Manufacturing Renaissance,” the Information Technology and Innovation Foundation (ITIF) discusses its new report on the subject. ITIF argues, “Despite some high profile cases of companies moving production back, the reality is that at the end of 2013 there were 15,000 fewer manufacturing establishments in the United States than in 2007.” MSCI would love to hear what you think about this debate!