United States to Surpass China as No. 1 Country for Manufacturing by 2020

As the competitiveness of American industry rises, so too does ranking amongst the world’s leading manufactures. Fortune.com notes that as of 2017, the United States is the second most competitive manufacturing economy after China. Global manufacturing executives predict that by 2020, The United States will surpass China as the leading manufacturer in the world.

There has been a drastic rise in competition in the United States and much of that can be attributed to cheap labor being a thing of the past. It used to be a vital point for manufactures, especially in China during the 1990s, where they encouraged cheap labor and required less environmental regulations. Today, technology has drastically reduced the need for additional workers and the keys to success are dependent on advanced technologies, the availability of materials and whether or not intellectual property protections are strong. The United States is ahead of the curb in these 3 categories.  

Future Forecast of Manufacturing until 2020

It is extremely beneficial that manufacturing firms believe the United States is a great place to do business, but there is misguidance when it comes to success having the same impact it did nearly half a century ago. Wages for most workers has been stagnant for a generation and those without college degrees are being granted less opportunity. 

The decline of manufacturing employment should not be considered a political failure, but rather a natural economic process that many industries have gone through in the past. As technology sectors become more sophisticated, it requires fewer workers to get the job done. There may be fewer workers, but it is a good sign manufacturing executives want to do business in America.

To the common citizen, they assume most products aren’t made in the United States anymore, but rather in China, Mexico and Vietnam to name a few and that the only jobs available or even left in America, are in hospitality and the food industry. While it is true the number of jobs in the manufacturing sector has declined, it doesn’t mean that the United States has become deindustrialized. It just means the number of jobs available have declined because efficiency in technology has required less workers.

There are many things that come off as surprising, one of them being that manufacturing is the largest and most dynamic sector of the United States economy. The industry is highly connected to other sectors, such as retail, mining, and transportation and also accounts for nearly 80% of what the private sector spends on research and development each year. Manufacturing provides innovation that keeps other businesses going.

If proof is required that manufacturing is still a viable and healthy industry in America, look no further than Rotor Clip Company Inc., the global leader in the manufacturing of Tapered Section Retaining Rings, Constant section retaining rings, Spiral Retaining Rings, Wave Springs and Self-compensating Hose Clamps. It is a family owned business that has been around since 1957, a testament to their importance among manufacturers. Rotor Clip serves a handful of industries, such as Industrial, Aerospace and Transportation, On/Offshore, Automotive, Commercial Aerospace, Topside/Onshore, Construction and Farm, Space and Defense, Subsea/Seabed, Recreational Vehicles, Railway and Heavy Industry and Down Hole/In Well. It is an example of how manufacturing serves every other industry in America and should be taken more seriously amongst the public.

Another surprising fact is manufacturing output is near a record high. In today’s economy, US factory workers produce twice as much as they did in 1984, but with a third fewer workers. Though there is still a high demand for foreign-made goods, it is believed it will take another 3 years of growth to surpass China.

The important thing to remember is American manufacturing is alive and well and technology has never been as advanced or efficient for the common worker. The only downside is the loss of well-paid jobs hurting the working class. The rise of low-skilled manufacturing in China and other developing nations equates to fewer Americans working in factories. A large percentage of American workers are in the service/producing industries, where inequalities in opportunities, skills and incomes are more apparent. Rebuilding the manufacturing economy to what it once was is not an easy task, but if it’s any indication, by 2020, the United States will be the leading manufacturer in the world and will harness the latest technologies to rebuild the industry, gain workers and begin to earn much more equitable profits.

Justin Arbadji is a Marketing Assistant for Rotor Clip Company