Wednesday, March 20, 2013

Jobs Flow Back: Now What?

Linamar Corporation is a Canadian company that manufactures engine parts out of what used to be a Volvo plant in Asheville, North Carolina.  Recently, President Obama visited the plant to tout as an example of America's current trend in luring global manufacturing jobs, reversing patterns of the past twenty-five years.

Indeed, outsourcing bridges the current and past centuries as the biggest challenge of the American workforce, but recent months have confirmed that this may be on the decline.  Part of this is due to changing demands in the market, but it shouldn't be underestimated how integral businesses' rising awareness of total costs have been.  That is because of groups like Harry Moser's "Reshoring Initiative" working to inform all levels of industry as well as government of the real, hidden, and unforeseen consequences of stretching the supply chain across an ocean.  The Reshoring Initiative has been recently hailed in the American manufacturing community as a force behind the political and business effort to fight for relocation of jobs lost overseas years ago.

Moser with other experts in the manufacturing field
meeting the President, January, 2012
Moser's most important audience might have been his visit to the White House last year as part of an Inshore Forum the Executive office held to address job loss.  There, Moser personally explained to Obama that unintended costs like emergency airfreight can eat into a bottom line enough that labor savings are offset.  He also pointed out that separating manufacturing from engineering creates a gap in the kind of department communication that produces innovation and product adjustment, crucial and overlooked advantages that outsourcing can turn into a liability.

While Moser has done much to bring this issue to light, it's also important to remember an economic strategy that centers around reversing outsourcing isn't really that comprehensive a strategy at all.  "Reshoring" is most certainly a welcome sign that the manufacturing community recognizes the value in keeping its supply chain close.  However, the global economy is not going to change;  there's always going to be a location or situation overseas that will offer cheap labor, and businesses are always going to look at that as some kind of an advantage.  Is it that we bug Congress and the business community to enact laws and efforts to get jobs back, or should we be more focused on growing new ones?  And if so, how?

Donal Thoms-Cappello is a freelance writer for Rotor Clip.