Everybody knows that our jobs have been going overseas. It’s been happening since the ‘80s and for decades nobody did much to stop it. In recent years people have recognized this as a problem for the structural soundness of the American economy and have begun taking action to reverse it. Too much dependence on others can be very bad for the stability of anything. If we are sustained mostly by external forces and something were to happen where we didn’t get that sustenance, we would be in some trouble.
So why do companies go offshore in the first place? They go because they can get more bang for their buck. In an effort to keep costs down companies will try to find people that will do the job cheaper. The first few major job relocations started in the late ‘80s beginning with telephone productions and auto parts. Manufacturers argued that moving their plants offshore was the only way to compete with inexpensive, high quality products that could be imported. The only real difference is that in one option they own the plants and in the other they’re buying goods from someone else’s plants. If they own the plants they cut out the middleman and that further reduces their costs.
Exporting jobs sounds like a great way to make products but it’s not exactly a good selling point, especially when compared to the same product that’s marked with a “Made in the USA” label. In fact, according to Consumer Reports, 8 out of 10 consumers would rather buy a product that has “Made in the USA” on it. So if a company exports jobs and makes their products overseas, they had better hope their product isn’t on a shelf next to a similar good that has been made in America. Furthermore, 60% of consumers would even pay 10% more for a product that has “Made in the USA” slapped onto it as opposed to one made overseas.
The state and federal government also gives incentives for companies to produce in the U.S. There are a number of tax deductions and exemptions that are made for companies moving jobs into the country, and I believe that is why jobs are actually returning to the U.S. In 2016 the trend for new and reshored jobs grew by over 10% with 77,000 new jobs and 50,000 jobs reshored, according to the Business Roundtable, an association of CEOs of major U.S. corporations.
This is progress but there are still millions of jobs overseas that need to be brought back to American shores. At this point I think the only reason for hesitation would have to do with the transition from offshore manufacturing. Building facilities here while still having facilities overseas may not be in the budget. I believe there should be financial options to help companies transition back to America. If their products will sell better, they get tax breaks and seamless production transitions, then I think more offshore jobs will come back to the United States. I think new companies with target markets in the U.S. will invest on American soil as well and we would be well on our way to getting into the shoes we fit in the ‘70s.