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The US is building factories at a fast rate

businessinsider.com

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Re: The US is building factories at a fast rate

#111

Post by bobthepanda »

wizofaus wrote: post #78
FrustratedMonky wrote: post #57

Earlier quoted context omitted.

Exactly. The factories follow the Cheap Labor. From US to China, then it was China to Thailand/SKorea, then from Thailand to India. Probably don't have chain correct, and it is different for different industries. But there was definitely a progression of 'local salary goes up', 'time to move to next cheapest country'.

Surely though there's still plenty of places in the world that, on the basis of labour costs, it would be vastly cheaper to operate than in the US. On that basis I'm not convinced wage growth in SE Asia is the primary reason the US manufacturing industry is deciding to reshore. Is the same phenomenon occurring in other wealthy countries that haven't put in place taxpayer funded incentives to do so?

Japan and Korea have plenty of domestic manufacturing. Europe also has some off shoring into the peripheral countries into its customs union.

The issues are generally that in the next largest potential cheap manufacturing sources (South Asia, SE Asia, Africa) they’re either not big enough or have extremely poor logistics and red tape. A big part of the East Asian miracles have been extensive infrastructure and bureaucratic emphasis on making exports as efficient as possible.

Re: The US is building factories at a fast rate

#112

Post by vineyardmike »

feoren wrote: post #93
onlyrealcuzzo wrote: post #21

Earlier quoted context omitted.

Compared to A Tier cities in some Asian countries? Does Santa Barbara or NYC really look antiquated compared to Mumbai? Or Da Nang? Or Fukuoka? Maybe if you're trying to compare Detroit to Shenzhen or Tokyo.

Yes, NYC looks and feels like an aging, antiquated city to me. I'd put D.C. above NYC -- it feels cleaner, newer, more efficient. Even London somehow feels less aged than NYC. Sydney, Helsinki, Copenhagen, and Amsterdam are a tier up again, and then cities like Tokyo and Singapore look like they're from the future.

> Even London somehow feels less aged than NYC.

Because London was partially bombed and rebuilt within the last generation.

New York wasn’t. NYC was built a while ago, and a lot of that infrastructure and builds still work.

Re: The US is building factories at a fast rate

#113

Post by vineyardmike »

Xcelerate wrote: post #15

Perhaps I'm just bad at economics, but it always seemed to me that the countries making all the stuff would eventually hold all the power (and I say this as someone working in tech who produces nothing tangible). The fact that it costs exorbitant amounts to construct new buildings, railways, etc. in the U.S. and how our cities almost look antiquated or frozen in time compared to Asian cities shows that we missed a ge…

We’ll think about it from the tech perspective: the companies that control marketplaces and access hold all the power.

Sure you have companies like apple that make $$$ from hardware, but most HW players in tech get slowly replaced offshore. Silicon Valley was silicon valley because of hardware. Now it’s mostly software, and HW is increasingly a commodity.

It’s the same thing elsewhere in the economy… it’s easier to set up a factory to sell something anywhere, but when you control buyers, you’re rich. The US is still the shopping powerhouse of the world… and even massive markets like China can’t consume as much because they just don’t have as much money.

Re: The US is building factories at a fast rate

#114

Post by activiation »

jakearmitage wrote: post #7

OK, now we need immigration reform to actually get enough people to work on everything.

I worked for a while at a farm processing potatoes ... Let me tell you that they aren't lacking Mexicans (most people didn't speak English and this was in Florida)

Re: The US is building factories at a fast rate

#115

Post by jxramos »

alexose wrote: post #32
obblekk wrote: post #2

> The US has added around 800,000 jobs in manufacturing employment over the last two years, employing around 13 million workers It's too early to know, but if it turns out the solution to decades of economic misery for middle class blue collar workers was 1. 50% tariffs on China, and 2. $100B of subsidies to chip makers and green tech... The reversal of Reaganomics we're living through will become permanent for at le…

Another important factor is that China's workers make more money than they used to, especially relative to the West. There's not as much of a cheap-labor-arbitrage opportunity as there was in the early 2000s. Here's a chart illustrating this point: https://i.insider.com/532ccb18eab8eadc39f33da6

it's been fascinating seeing the expanded representation in imported goods. I bought a baseball the other day and it was made in Cambodia. I think that was a first for me. Seeing lots of tools shift to Taiwan which has long been in the tool fabrication business. Textiles from India. Seems like the stuff I'm seeing in stores in the last say 6 months have dispersed away from China. I think a lot of plastics still come from China I want to say though.

Re: The US is building factories at a fast rate

#116

Post by no_wizard »

obblekk wrote: post #2

> The US has added around 800,000 jobs in manufacturing employment over the last two years, employing around 13 million workers It's too early to know, but if it turns out the solution to decades of economic misery for middle class blue collar workers was 1. 50% tariffs on China, and 2. $100B of subsidies to chip makers and green tech... The reversal of Reaganomics we're living through will become permanent for at le…

I had a professor remark once (this is circa 2009) that we should all learn a highly skilled trade around advanced manufacturing because eventually offshoring will reverse itself and by your early 30s you'll be in a prime position to profit immensely off the re-shoring of advanced manufacturing equipment and processes

Maybe he was right. I'm in my early 30s now, and I don't regret becoming a software engineer, but all the highly skilled tradesmen I've met in the last 5 years make at least what I do, often more, and have the benefit of actually owning their own businesses or real, meaningful slices of other ones.

I'll boldly admit I don't think I would like over physical labor and I do wonder about the toll of it long term, but they make a killing, especially the ones willing to travel all over the US.

Granted, the highest earner I know has both a degree in CS and Industrial Engineering, and goes all over the place working with industrial robotics and makes piles of money doing it. More than elite SV companies in the last 3 years, IIRC, if you discount the stock based compensation package (simply salary to salary comparisons) its north of 300K.

And arguably better retirement benefits, I think 12% goes to the 401K and they get bonuses every quarter right now. Well invested I bet he'd come out ahead. Can't for the life of me remember the name of the company though.

EDIT: forgot to mention the folks making tons of money on the DoD now starting to require things made in the USA and sourced raw materials from either inside the US or from friendly approved countries from the last few years either, and I don't think that's going away any time soon. They've in the last 2-3 years started paying lots and lots of money to get suppliers that are US based and source their raw material from friendly nations only, and they pay alot of money to make it worth while.

Re: The US is building factories at a fast rate

#117

Post by lotsofpulp »

mwbajor wrote: post #82
lotsofpulp wrote: post #72

Earlier quoted context omitted.

> Building things has been looked down upon for 40 years because boomers thought it was a step backwards since their parents worked on the assembly line. No, it was looked down upon because the pay to quality of life ratio was much better in white collar careers. It probably still is for the most part. Wake me up when the same people are deciding between becoming plumbers or electricians rather than lawyers or doctor…

Well then wake up because most of those parents didn't send their kids to school for those careers.

But that was the goal. If they didn’t make it to the doctor/lawyer/engineer/financier level, then middle management or consultant or whatever other desk job would have to do.

Either way, a Mon to Fri 8 to 5 salaried gig with benefits requiring little travel and no health risks was a comparably better goal to aim for due to the lack of sufficient price premium for the non desk job labor.

Re: The US is building factories at a fast rate

#118

Post by vineyardmike »

obblekk wrote: post #2

> The US has added around 800,000 jobs in manufacturing employment over the last two years, employing around 13 million workers It's too early to know, but if it turns out the solution to decades of economic misery for middle class blue collar workers was 1. 50% tariffs on China, and 2. $100B of subsidies to chip makers and green tech... The reversal of Reaganomics we're living through will become permanent for at le…

3. Covid disruptions to the supply chains coming out of China revealed how expensive and risky it was to manufacture there.

Re: The US is building factories at a fast rate

#119

Post by edgyquant »

totalZero wrote: post #9

I'm not cheering the victory until I can buy a made-in-USA iPhone. China totally outclasses the USA when it comes to manufacturing. https://www.statista.com/chart/28031/manufacturing-racing-ba...

When it comes to light manufacturing, sure, but they’ve struggled to just get to a point where they can do sophisticated heavy manufacturing at any kind of quality and this has been the result of US policy helping them out here. It wasn’t until Trump that this process ended and it became policy to not allow China to build a competitive heavy manufacturing industry. We will see if they pull through and become a rival in that regard as well; but I’m betting that now we’ve cut off their military from our tech and are pushing our companies out of China that they stagnate.

This comment gives a better perspective https://news.ycombinator.com/reply?id=36247499&goto=threads%...

Their “miracle” was a US creation, a policy to build them up to create a counterbalance to Russia. It’s gonna take ten years to tell, but China is already feeling these effects and feeling them hard.

Re: The US is building factories at a fast rate

#120

Post by marianatom »

AnimalMuppet wrote: post #92
marianatom wrote: post #11

Meanwhile in China: - exports plunge by 7.5% in May, far more than expected https://www.cnbc.com/2023/06/07/chinas-exports-plunge-by-7po... - profit tumbles 18% in April https://www.reuters.com/world/china/china-industrial-profits... - chip progress stagnating. Oppo chip design unit completely shut down https://techcrunch.com/2023/05/12/oppo-chip-disbands-phone-c... . Japan stops shipping semiconductor equipments to…

8 million babies for a population of 1.2 billion? Woah. Back of the envelope, that's something like half replacement rate.

Yeah and that's not the crazy part. There's a 50% drop in marriage rate in 2023 compared to 2022.
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