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Downsizing and sending of manufacturing jobs оff-ѕhоrе hаѕ resulted in a rebirth of small business manufacturing and selling of US-Made рrоduсtѕ. Thіѕ аrtісlе presents four reasons why consumers should purchase US Made Products instead of the “lower соѕt” imported counterparts.

Create/retain American Jobs

Are you concerned about the high unemployment rate? Then do something about it and buy US Made Products. Your purchase of a US Made Product allows the US manufacturer to hire or retain a US worker. The purchase also provides an incentive to the manufacturer to increase production or create new products – and hire more employees. Approximately 75% of the retail price is returned to US-based employees; and State and Federal taxes are paid on the retail, wholesale, and manufacturing phases of the sale.

In contrast, the purchase of a $100 foreign-made product has less or no impact on American jobs and the American economy. If the retailer is a brісk-аnd-mоrtаr ѕtоrе, аррrоxіmаtеlу $25 goes to the retailer, who also pays state and federal taxes. But if the retailer is an off-shore іntеrnеt ѕtоrе, no раrt оf the purchase price is returned to US employees, and no retailer taxes are collected. If the dіѕtrіbutоr іѕ US-bаѕеd, аррrоxіmаtеlу $6 of the $100 purchase price is returned to a US-based employee; and state and federal taxes are paid.

Lower True Cost

Have you ever wondered why that new imported toy you bought for Christmas is broken in less than 3 months? The truth is, it was designed with the least amount of plastic or metal possible, and the sooner it breaks, the sooner you will buy a new one. Paraphrasing PT Barnum, There is a new American Sucker Born Every Minute. Reputation mеаnѕ lіttlе to a mаnufасturеr when he knows there are enough new customers to replace the disgruntled customers.

Domestic manufacturers, hоwеvеr, must be more conscious of their reputation, or take the chance оf lоѕіng thеіr market to imports. They design their products to last until уоu wаnt tо rерlасе іt; not when they want it to break.

So, which has a higher true cost – a $3 toy that breaks in 3 months (and is probably unrepairable), or a $10 toy that lasts for years (or until it is lost)? Go figure..

Product Safety

If you have any doubt about the safety problems encountered with imported merchandise, take a look at a recent list of toy recalls. Most are imported. Let’s take a look at why there are so many product recalls of foreign-made products:

• The manufacturer has the primary responsibility for product safety plans and verification.
• As a result of limited manpower, verification of compliance to the safety plan is on a spot-check basis.
• Fines for safety violations are not significant compared to profits that can be made by employing a limited or non-existent Quality Assurance Department at the manufacturing facility.
• Damage to the reputation of the off-shore manufacturer as a result of a product safety recall is minimal, and any damage to the reputation of the importer is also minimal due to a virtually unlimited number of American consumers that are unaware of the recall.
• A foreign manufacturing facility closed as result of numerous safety violations can be replaced with another facility with a minimal impact to the profits of the Corporate Headquarters.

In contrast, as stated previously, a US-based manufacturer has a higher incentive to satisfy the consumer. As a result, there is most likely more emphasis on product safety

The advanced manufacturing industry is growing more and more mainly due to business expansion through organic growth and the modernization of manufacturing technologies. It sounds really good in and of itself, but a closer look reveals a pretty big issue, and action needs to be taken now if we want to see our manufacturing sector still performing at a gain ten years from now.

With manufacturing jobs being more and more in demand, it is predicted that over the next ten years 3.5 million positions will be available in the manufacturing field, of which 2 million positions will remain unfilled because of skilled labor shortage. The math in that says that this will lead to a loss of $32 billion that could’ve otherwise go back into our economy, but will go instead into finding skilled workers for those 2 million unfilled manufacturing jobs.

So why exactly will we be facing such a major skilled labor shortage? There are a couple of factors that will lead to this situation. One is the movement of experienced workers which causes the loss of embedded knowledge. Another factor is the shortness of workers that have certified STEM skills (science, technology, engineering and mathematics skills). A third factor is represented by the decline of technical education and vocational training in schools.

However, the main two reasons why the future of the advanced manufacturing workforce raises concern are economic expansion due to natural business growth, and the baby boomer retirements that will likely leave somewhere around 2.7 million open jobs.

To be able to grasp the importance of the impact this will have on our country as a whole, here are a couple of facts:

Approximately one of seven private sector jobs in the US directly depends on the local manufacturing base;

Every 100 jobs in the manufacturing sector creates an extra 250 jobs in other fields;

One dollar spent in manufacturing adds $1.37 to the country’s economy;

The lack or decline of a US-based manufacturing workforce is a matter of national security.

We need highly skilled, trained people to fill all the jobs that will be available as a result of workforce retirements and organic growth in business. And we need to be able to find that skilled and up to the challenge workforce fast, without manufacturing companies having to lose over 10% of their net earnings looking for that workforce, and without manufacturing companies having to lose precious time and resources training people that may very well end up leaving the job because they didn’t know what they were getting into from the get-go.

Solutions such as reintroducing vocational training in schools, and creating organizations that help veterans and transitioning Service members get certified for jobs in advanced manufacturing are a very promising start to avoiding a decline in the US advanced manufacturing sector, but it’s up to every individual to do an effort in order to raise awareness on the issue, and to encourage the development of more solutions.

“Made in the USA” products are becoming more and mоrе important each day to consumers in оur соuntrу. Whеn a recession hits this seems to increasingly be the case as people revert back to mаnufасturіng аѕ a stimulus for job growth. This is because Manufacturing is a large and vital part оf thе есоnоmіеѕ of most countries.  It all starts with taking natural resources and rеfіnіng them into man made materials that can be converted into tangible gооdѕ fоr consumers to buy and соnѕumе.

Mаnufасturіng is the primary sector that feeds all the remaining sectors. It dереndѕ оn, аnd feeds other businesses that provide value-added services.  All these businesses fоѕtеr орроrtunіtіеѕ for professional services such as legal, accounting, technology and соnѕultіng. So whеn a product is Made in the USA, it is only natural that it will enrich growth as vаluе іѕ created through the supply chain to the consumer. This growth will eventually сrеаtе opportunities where jobs can be created throughout thе ѕuррlу chain and in all sectors of the economy.

1. Corporate behavior beyond products sold matters. Whіlе American-made products certainly impact buying сhоісе, thе bеhаvіоr of a company at the corporate level seems to have just as much of an іnfluеnсе. In fact, Consumers Reports says that 92% of individuals surveyed ѕаіd they are more likely to buy from a company that gіvеѕ back tо the local community. Other factors significantly impacting consumer buуіng decision include how well workers are trеаtеd (90%), the environmental practices of the company (79%), whеthеr thе corporate aspect of the company is foreign or American (78%), and whеthеr or nоt a manufacturing facility exists in the individual’s state (75%).



2. Quality still matters. Those сhооѕіng tо buy American often do so because of the quality of the product, аnd mаnу bеlіеvе American-made products are often better quality than fоrеіgn-mаdе. Tаkе сlоthіng for example. Consumers Reports says 61% of survey respondents believe American-made сlоthіng is higher quality than foreign-made сlоthіng. Aѕ Amеrісаn products increase in quality, so too does the loyalty of соnѕumеrѕ wanting tо not just buy American-made but quality as well.
3. American-made products keep jobs in America. Whіlе U.S. manufacturing continues to ѕtrugglе, Time rероrtѕ that its growth currently outpaces that of other advanced nations. Thіѕ means the number of American manufacturing jobs is increasing and wіll continue doing so providing companies see the big picture benefits оf рuttіng down and/or keeping roots on Amеrісаn soil. On thе other side of the coin, American workers must rise to the challenge and prepare a workforce аblе tо hаndlе the technical skills required in the future of manufacturing.



4. Outsourced Manufacturing Plаntѕ Rаrеlу Return to the US. One less considered fасtоr is thаt оnсе a product has been outsourced to a foreign country, in too many cases it will never again be manufactured іn the US. That аvеnuе of potential business has vаnіѕhеd. This must be avoided at all costs in order to strengthen our economic standing domestically, while еlіmіnаtіng our reliance on foreign goods.
5. Foreign product safety standards are less еxtеnѕіvе thаn those here in the USA. For example, poisonous levels of lead аrе іn millions of items shipped to the USA. When you buy goods made in thе USA, you саn be confident that American consumer protection laws and safety standards are upheld іn оrdеr tо protect you and your family.

We all know that buying products from local businesses is healthier for us, as consumers, and extra beneficial for the economy of any community, big or small. Buying locally sourced food should also be a priority for those who are eco-conscious and wish to make an effort in order to minimize their carbon footprint. And while there are quite a few reasons why our buying locally as much as possible impacts the environment in a positive way, you can continue reading about some of the more important of those reasons in what follows.

Transportation

With trillions of dollars spent on importing products in the US every year, it’s not only the average consumer’s general health and wellbeing that is at stake, but also the health and wellbeing of our environment. Product transportation via aircraft is a great greenhouse-gas emissions culprit, transportation via shipping produces emissions of over one billion metric tons of carbon dioxide every year, while product transportation via trucks and trains are to blame for over a quarter of smog-causing pollution. Local and sustainable agriculture decreases the need for transportation, reducing the environmental stress caused by the food market globalization.

Greenhouse Gasses

Food that’s being produced at industrial levels will always create greenhouse gasses, simply because you can’t make industrial supplies of products at a profit without using fossil fuels. However, the area in industrial farming responsible for the biggest consumption of fossil fuels is not transportation or equipment, but chemicals, both pesticides and fertilizers. Local farmers who work their small lands will always do their best to maintain and sustain the surrounding natural habitat, will keep to a pre-designed crop rotation schedule, and will be mindful and proactive in what concerns water usage and carbon sequestration.

Recycling

Processing, transportation, and chemicals are not the only big reasons why this international unsustainable food system should be replaced by an environmentally-friendly local food system. With the materials used for food packaging being some of the least recycled materials in the US, it’s easy to understand why buying produce from local farmers who make a conscious effort towards minimizing storage and transportation packaging is the right choice to make.

Better health, financial wellness, and a balanced environment are all concerns of the modern man, and by putting our efforts together, it would be reasonable for us to be bullish on the betterment of our ecosystem. Small, individual steps towards this eco-oriented goal will diminish the stress pollution exerts on our environment, and buying local is certainly one of those steps.

Careful studies have shown that many products can be profitably produced in the U.S. by a well-paid workforce because the production processes involved uses sophisticated machinery that assures high levels of output for each hour of labor.

While capital-intensive manufacturing typically takes place in workplaces that employ far fewer people than the factories of the 1950s, a vibrant manufacturing sector can be critical to the health of both urban and rural communities because of the unique linkages of manufacturing work.

There is now a close connection between advanced manufacturing processes and the research and development efforts that feed into these processes, so that if the United States lacks manufacturing capacity for certain products, it will also ultimately lose the research and development capacity supporting those products as well. It follows that, for the United States to continue pioneering new industries, the nation needs a strong manufacturing sector.

Manufacturing jobs generally pay better than other jobs available to those without a college degree, and they are critical to the economic vitality of many states in the Midwest and Southeast.

There are two distinct ways in which twenty-first-century manufacturing differs radically from mid-twentieth century manufacturing. First, contemporary manufacturing is highly dependent on cutting-edge science and technology. Whether it is a question of using newly developed composite materials, relying on the latest advances in robotics, or incorporating other recently developed technologies, manufacturing now relies heavily on the research being done in government-funded laboratories. This is true of the latest models of smart phones, solar panels, robots, wind turbines, advanced batteries, and pharmaceuticals, but it is also increasingly true of airplanes, automobiles, machine tools, and even more mundane products such as textiles and building materials.

The second key change in manufacturing is that it is now a “team sport,” in that manufacturing firms in and across sectors are much more mutually dependent. Back in the 1920s, for example, Henry Ford sought to excel in manufacturing as an individual sport. He built the River Rouge complex with its own electrical power plant, its own steel mill, and its own glassmaking facility, so that he could build cars without having to purchase any inputs from other firms. Today, however, that strategy would make no sense. Firms that specialize in making glass or steel or carburetors or transmissions or seating assemblies can supply those components more efficiently and at lower cost than can an automobile company. This is true because specialization allows a firm to make substantial investments in the technical knowledge and the skilled workers that are required to keep improving the specific product that it makes. The consequence is that today, as much as 70 percent to 80 percent of the value added of a typical automobile is purchased by the automobile manufacturer from suppliers.

Both research-intensive innovation and specialized, disaggregated manufacturing work in the same direction. In contemporary manufacturing, an individual firm is highly dependent not only on outside scientists and engineers, but also on other firms that are buyers or suppliers or collaborators in producing particular things.

This dependence on others can create a serious problem, however. A firm, whether big or small, might have a great idea about a new product, but it cannot move forward until it finds the appropriate partners for both developing and making the product. Finding appropriate partners, in turn, is difficult and time-consuming, and some potential partners might exaggerate their skills, or otherwise prove to be unreliable or untrustworthy. And even when one has found good partners, uncertainty remains.

With advanced manufacturing, figuring out how to mass-produce a complex product is often a major challenge, and it can be difficult to find a labor force with the skills needed for production. Even if these hurdles can be overcome, there is still the considerable risk that the new product will not find a market, either because it is rejected by regulators or by consumers.

Businesses often utilize foreign manufacturing processes as a means of reducing the costs associated with building items. This comes as the cost associated with getting items manufactured declines when they are made in certain parts of the world. But the truth is that foreign manufacturing actually does more to hurt the wages of workers in the United States. This is a threat that could hurt the American economy when all is considered.

A great concern about foreign manufacturing is that the process helps to shrink the cost associated with making items. This should be appealing, but it also makes it to where the costs of products might decline over time. This is due to how companies typically sell items for cheap when they know they are less expensive to make.

But as this occurs, it becomes easier for local wages to be cut down. By keeping the potential profits associated with cheap items from being too large, it becomes harder for workers in the United States to receive enough money.

There is also the concern that a business might use the same pay structure for all employees. This is not to say that American workers will absolutely be paid the same as those in other countries. The Americans are simply being valued less because they are not treated as seriously as other people.

What is even worse is that foreign wages are certainly bound to increase over time. As the demand for workers in other countries increases, the potential for wages to rise in other places will grow. This all comes as another country will feel a little more valued in some way as there are concerns over how much money people are earning in those spaces. The fact that demands for higher pay will go up over time only makes it harder for people to get paid properly in the United States as budgets are strained in general.

It is vital to look at how foreign manufacturing could be a problem with regards to managing local wages. The potential for wages to decline in value is strong as more companies start to move their resources and functions to other parts of the world.

1. Applying VAT to Knock Down the Trade Deficit

The value-added tax is a tax used by over 130 countries. By waiving the VAT on exported goods and applying it on imported goods, imports would increase in price, helping goods manufactured in the US to be more cost competitive. VAT is usually 17% in the countries that impose it. Theoretically, this percentage would bring over $300 billion in revenue per year – that is 17% on $2 trillion worth of imports.

Of course, in order for VAT to work in the US, tax relief and tax reduction should be put in place on both the business and the consumer sides. Without the current system which involves double taxation on exported goods (when leaving the US and then again when entering the destination country), but with a VAT system instead, US exports will benefit from better pricing.

2. Investing More in Automation

Investing more in automation when many people are left out of a job due to manpower-reduction technologies may seem counterintuitive. Well, looking at the big picture, this tactic is not at all unreasonable. And while keeping our jobs in manufacturing will always be of great focus in the betterment of our economy, the future will definitely not present too many opportunities to those countries that don’t keep up with their investment in automation and other such manufacturing technologies.

Investment in factory automation and technology research is not pushed enough by policy makers in the US as it is in other developed countries. In the last five years, the US National Robotics Initiative has funded less than 15% of the applications registered by researchers. Encouraging both bigger investments in automation and tax breaks can do a big difference for the better in the future of US manufacturing.

3. Revitalizing Our Manufacturing Hubs

Little is left of the former industrial heartland of America, but the Rust Belt would be able to keep on giving through regional centers of expertise. Such a center is usually started by a regional development agency or a chamber of commerce. This group would be the middleman that brings together government agencies, businesses and schools in order to create a larger interconnected group of people and organizations that can direct its focus towards working as a unit, with the ultimate purpose being to attract new business and support innovation.

For example, even if manufacturing US consumer electronics is an industry that has been almost completely off-shored, the towns and cities that thrived on this type of manufacturing work in the past still possess the manufacturing know-how and manufacturing talent to lay the groundwork for innovation, attracting new business, and for building a more fair and competitive market. The potential exists, and it’s about time we start leveraging that potential.

1. Bringing Down the Trade Deficit

The long waiting game of sitting tight until US exports somehow gain more popularity is not the most proactive approach to pulling down our trade deficit. A pretty good idea for solving this issue is through certificates – exporter and importer certificates. This means that a US-based company that is in the business of exporting goods will bring in certificates equal to the value of its exports, while overseas companies that are in the business of importing goods in the US will have to buy certificates from the home-based exporters.

Through the means of this certificate system, the US would have the necessary budget derived from selling importer certificates to export goods at lower prices, becoming more competitive in the market, and gradually knocking down the trade deficit. What’s more, due to the extra costs involved with purchasing importer certificates, imported goods will become more expensive, creating again the possibility for US-made goods to become cost competitive.

2. More Awareness Regarding the Costs That Come With Offshoring

One way of bringing more awareness in what concerns the total costs implied in manufacturing overseas is by requiring companies that are making mass layoffs, and offshoring production, to explain their expenses. And some will argue that this can be enforced by formally modifying the federal Worker Adjustment and Retraining Notification Act. More specifically, the part stipulating employers having to provide a 60 calendar-day advance notification prior to a mass layoff.

If the desire for efficiency and greater monetary gain leads to mass layoffs and companies moving overseas, this exact loss of trained personnel and downgrade in terms of product quality and reliability will eventually lead to an offshore business that will lose money instead of bringing more. A couple of reasons why this tends to happen are costs related to the need to hold a larger inventory, costs related to transportation, costs related to the consequences of producing a more unreliable  product et cetera.

3. Getting Rid Of Redundant Regulations

It is estimated that companies spend approximately $140 billion every year on regulatory compliances. The reason for this is in the way federal agencies operate when it comes to imposing new rules, especially in the areas of workplace safety, environmental protection, and financial reporting. The phenomena here is that when new regulations are imposed, federal agencies are used to not checking other agencies for conflicting or similar rules. This way of doing things often brings on redundancies in regulations and duplicates in reforms that make it hard for companies to comply with federal mandates.

One of the best solutions here would be a specially designated panel in Congress that would be in charge of going through all the existing regulations, finding reforms and redundancies, and compiling a set of recommendations regarding their findings on which Congress would then vote, modifying the regulations that need modifying, and repealing those that need repealing.

The economic future of America can greatly benefit from the reintroduction of vocational training in schools. And while this idea may not blend particularly well with the college-oriented culture popularized in our country over the last six decades or so, it certainly begins to make more and more sense as statistics keep revealing the true consequences of the ability tracking system in schools.

Statistics show that 70% of high school students will not pursue a four-year college education. Out of the 30% of high school students who will go to college, about half will graduate. This means that approximately 15% of high school students will end up with a college degree in their hands. Statistics also show that over half of recent college graduates will be underemployed or unemployed. And all of this is happening while states are continuously cutting vocational programs in schools.

We’re also facing another trend in the manufacturing industry where graduate students are being employed in positions for which they wouldn’t normally need a college degree, having to learn new skills through training, apprenticeships, or even by attending additional vocational training. This whole process is one more cause for money leakage in the manufacturing sector, and it could be avoided if the new employee had already been trained for the job in school.

As time passes, the lack of vocational training in school produces a bigger and bigger skill shortage in manufacturing. And that same skill shortage is one of the reasons offshoring production has become such a usual course of action for plants and factories in the US.

At the same time, manufacturing in America is going through yet another shift, and this time things appear to be looking brighter. Modern manufacturing technologies are opening the door towards industry growth, growth that in its turn opens the door to more jobs, better payed jobs for the highly skilled. With the modernization and growth of the manufacturing sector, it is now the time maybe even more than before to create vocational programs, and introduce them in high schools and community colleges.

We need good and highly skilled craft workers to replace the generation of highly skilled craft workers that are now retiring. We also need highly skilled workers for the new and often times challenging positions that are opening up in the manufacturing field. In order for this to happen, we also need to change the mentality around working in the manufacturing sector, and this means changing the college-for-all culture. Different people have different sets of innate skills, not to mention the different ways in which we’re programmed to learn and function in an academic setting. Giving students with different inclinations and different skills the opportunity to choose different paths is a golden ticket to improving our economic future by populating the manufacturing sector with experts that are ready to work their hands and minds in our US-based factories, increasing both local production, industry wages, and our country’s economy.

Walk into the average store and pick up an item. Check said item to see where it was made and you will invariably see China, Taiwan, and a host of other countries as the source. A sense of national pride may make some consumers look for the American made equivalent, but a comparison of the price between the two items will show that it’s the foreign made piece that is the least expensive. Most of us work on a budget, so we decide to go with the cheaper item, only to find that it needs to be replaced sooner rather than later.

This is not a scenario that is prevalent in one type of store, as it is one that is common all across the country, whether you are looking for clothing, electronics, or anything else that the American consumer holds near and dear. Shelves in every single store in this country are home to cheap goods that are poorly made in some country that many of us are never heard of, yet we all snap up those items as though they are going out of style. Why do these terribly made items continue to land on our doorstep every single day?

The most obvious reason is that the average American consumer continues to fork over cash for items that they know are probably inferior. We live in an instant gratification world these days, and what is more gratifying than getting your hands on an item that you really want, and all at a price that seems too good to believe? The reason the thing you want is so cheap is because it is made in a place where labor laws don’t really exist. That electronic item that you hold so dear may have been pieced together by a group of 12-year old’s who know nothing about how a computer or smartphone works.

While we would all love to have the brand name item that we know is made well and will last a long time, the reality is that few of us will actually pay a little more for them. That doesn’t mean that we can’t try to keep up with the Joneses, though, which is why these poor-quality knock-off items continue to fly off the shelves. They are cheap for stores to buy in bulk, making it easy for sellers to bump up the price and make a killing off a terrible product.

Sure, it may seem as though we are being bilked by these stores, but we have all entered into a silent agreement where we will continue to buy poorly made foreign products for as long as businesses sell them at prices that fit our tight budgets. The labor laws in these overseas countries are not going to change anytime soon, and unless we all wake up and realize the consequences of buying cheap foreign junk, neither are our spending habits. We have become a society content with disposable items that can be easily and cheaply replaced, and until that changes, you can keep expecting to be underwhelmed with the products you purchase.