Tuesday, May 31, 2016
The Manufacturing Footprint and the Importance of U.S. Manufacturing Jobs
The Manufacturing Footprint and the Importance of U.S. Manufacturing Jobs: Despite policies that have shrunk manufacturing employment and hurt its international competitiveness, U.S. manufacturing is still a large and vital part of the U.S. economy. It accounts for 8.8 percent of employment in the United States—a total of 12 million workers in 2013—and plays a particularly important role in the labor markets of the Midwest and the South.
Monday, May 23, 2016
Tuesday, May 17, 2016
Thursday, May 5, 2016
Friday, April 22, 2016
Manufacturers Bringing The Most Jobs Back to America
The loss of American manufacturing jobs to foreign labor has been a central theme of several presidential candidates’ campaigns. However, the trend of offshoring may be slowing, according to one organization.
According to non-profit advocacy group the Reshoring Initiative, offshoring resulted in a net loss of approximately 220,000 manufacturing jobs from 2000 to 2003. However, according to the group, the country added roughly as many jobs due to foreign investment and reshoring as it lost to offshoring last year. Some of the largest U.S.-based companies, likely for both public relations and practical reasons, have begun building factories domestically for operations that would likely have gone overseas a few years ago.
Offshoring, or shifting production from U.S. plants to foreign facilities, is a relatively recent phenomenon that has taken a considerable toll on the U.S. economy. In an interview with 24/7 Wall st., Harry Moser, founder and president of the Reshoring Initiative, explained that recent developments have made the prospect of manufacturing domestically much more feasible. Moser cited economic troubles and rising wages in China as one of the primary drivers of this recent trend.
Indeed, lower labor costs and fewer regulations in countries such as China have created an incentive for U.S. companies to relocate production there. Consequently, U.S. manufacturing has taken a major hit. A study by the Economic Policy Institute found that the U.S. lost roughly 2.4 million manufacturing jobs to China alone from 2001 to 2013.
However, the same market forces that have pushed American jobs overseas are now bringing some of those jobs back. Recently, labor costs in places such as China have been rising, and when paired with high international shipping costs, offshore production presents less of a discount than it once did. Recently, General Electric shifted production of a water heater from China to a plant in Louisville, Kentucky. The move brought hundreds of manufacturing and engineering jobs back to the U.S.
While the reshoring phenomenon is primarily a byproduct of expensive labor abroad and high shipping costs, bringing manufacturing jobs back to the United States is often beneficial to a company’s image. For example, Walmart contracted General Electric to manufacture high efficiency light bulbs in its plants in Ohio and Illinois as a part of Walmart’s brand-boosting Made in USA initiative. Similarly, Farouk Systems, Inc. cites image as a primary reason for reshoring jobs. Along with Walmart and General Electric, Farouk Systems ranks among the companies bringing the most jobs back from overseas.
A variety of other logistical factors are also making reshoring more practical for businesses. In the era of Amazon, in which consumers expect quick turnaround on products, it can be more practical for companies to manufacture products in-country to have the product ready for customers faster and avoid shipping expenses.
Moser further explained that reshoring can often improve the quality of the manufacturing product. “Many have done it because of the consumer preference for made in America products.” Moser added.
The extent to which these factory openings are truly a sign of an American manufacturing renaissance or merely a pause from the ongoing departure of the industry from U.S. shores is still unclear. One certainty is that it will take more than a few thousand jobs to reverse the trend of decades of offshoring and heavy reliance on foreign imports.
The roughly 22,000 jobs these companies have brought back to the country over the last five years is not insignificant, but it is a drop in the bucket compared to those they have sent abroad. According to one EPI estimate, Walmart alone was directly responsible for the loss of 200,000 American manufacturing jobs due to it’s Chinese offshoring.
It is perhaps much easier to make the argument that the service sector is experiencing a true revival. While several years ago it was common practice for American companies to offshore customer support call center jobs, many American companies and customer service contractors are adding or plan to add jobs in the U.S. As of last year, there were roughly five million Americans employed in some 66,000 call centers across the country.
The Reshoring Initiative provided 24/7 Wall St. with estimates for the U.S. based companies that have reshored the most manufacturing jobs in the past five years. These reshoring estimates are based on company announcements to move international manufacturing operations to the U.S.
These are the manufacturers bringing the most jobs back to America
Read More
According to non-profit advocacy group the Reshoring Initiative, offshoring resulted in a net loss of approximately 220,000 manufacturing jobs from 2000 to 2003. However, according to the group, the country added roughly as many jobs due to foreign investment and reshoring as it lost to offshoring last year. Some of the largest U.S.-based companies, likely for both public relations and practical reasons, have begun building factories domestically for operations that would likely have gone overseas a few years ago.
Offshoring, or shifting production from U.S. plants to foreign facilities, is a relatively recent phenomenon that has taken a considerable toll on the U.S. economy. In an interview with 24/7 Wall st., Harry Moser, founder and president of the Reshoring Initiative, explained that recent developments have made the prospect of manufacturing domestically much more feasible. Moser cited economic troubles and rising wages in China as one of the primary drivers of this recent trend.
Indeed, lower labor costs and fewer regulations in countries such as China have created an incentive for U.S. companies to relocate production there. Consequently, U.S. manufacturing has taken a major hit. A study by the Economic Policy Institute found that the U.S. lost roughly 2.4 million manufacturing jobs to China alone from 2001 to 2013.
However, the same market forces that have pushed American jobs overseas are now bringing some of those jobs back. Recently, labor costs in places such as China have been rising, and when paired with high international shipping costs, offshore production presents less of a discount than it once did. Recently, General Electric shifted production of a water heater from China to a plant in Louisville, Kentucky. The move brought hundreds of manufacturing and engineering jobs back to the U.S.
While the reshoring phenomenon is primarily a byproduct of expensive labor abroad and high shipping costs, bringing manufacturing jobs back to the United States is often beneficial to a company’s image. For example, Walmart contracted General Electric to manufacture high efficiency light bulbs in its plants in Ohio and Illinois as a part of Walmart’s brand-boosting Made in USA initiative. Similarly, Farouk Systems, Inc. cites image as a primary reason for reshoring jobs. Along with Walmart and General Electric, Farouk Systems ranks among the companies bringing the most jobs back from overseas.
A variety of other logistical factors are also making reshoring more practical for businesses. In the era of Amazon, in which consumers expect quick turnaround on products, it can be more practical for companies to manufacture products in-country to have the product ready for customers faster and avoid shipping expenses.
Moser further explained that reshoring can often improve the quality of the manufacturing product. “Many have done it because of the consumer preference for made in America products.” Moser added.
The extent to which these factory openings are truly a sign of an American manufacturing renaissance or merely a pause from the ongoing departure of the industry from U.S. shores is still unclear. One certainty is that it will take more than a few thousand jobs to reverse the trend of decades of offshoring and heavy reliance on foreign imports.
The roughly 22,000 jobs these companies have brought back to the country over the last five years is not insignificant, but it is a drop in the bucket compared to those they have sent abroad. According to one EPI estimate, Walmart alone was directly responsible for the loss of 200,000 American manufacturing jobs due to it’s Chinese offshoring.
It is perhaps much easier to make the argument that the service sector is experiencing a true revival. While several years ago it was common practice for American companies to offshore customer support call center jobs, many American companies and customer service contractors are adding or plan to add jobs in the U.S. As of last year, there were roughly five million Americans employed in some 66,000 call centers across the country.
The Reshoring Initiative provided 24/7 Wall St. with estimates for the U.S. based companies that have reshored the most manufacturing jobs in the past five years. These reshoring estimates are based on company announcements to move international manufacturing operations to the U.S.
These are the manufacturers bringing the most jobs back to America
Read More
Tuesday, March 8, 2016
The Importance of Kitting In Efficient Operations
Today, companies must operate with maximum
efficiency, making every process, every procedure, and every dollar count. To
compete in an increasingly competitive, globalized economy, manufacturers have
to become “lean, mean” machines. How can kitting help them do this?
Kitting: A Quick Definition
As manufacturers know, assembling complex parts – whether
for aerospace applications, medical devices, or commercial products – involves
a multitude of parts. When each of those components come in separate packages
or even different shipments, it can cost valuable time, resources, and money
trying to find the right parts for the right assembly at the right time.
Kitting addresses this problem with impeccable efficiency:
it is the process of gathering parts and components for a particular assembly
or product as a kit. The pre-assembled kit is shipped as needed, instead of
packaging each piece as an order is received.
A typically “lean” concept holds that the more parts are
handled, the greater the odds of error and damage. Kitting helps reduce the
amount of times that components must be handled prior to assembly. The risk of
defects and mistakes is significantly mitigated, if not eliminated. As a
result, quality can be greatly increased.
Other benefits include:
- Reduced downtime. One of the biggest problems in a manufacturing environment is employee and machine downtime. Trying to find the necessary parts can slow the entire production line down. Kitting puts everything together, in one convenient package.
- Simplified procurement and supply chains. With kitting, ordering is much quicker and easier, and manufacturers do not have to worry about product or component compatibility.
- Maximum output. Line employees spend their time assembling products/pieces, not searching for the right components. This reduces WIP (or work-in-progress time).
- More streamlined training. When new operators are hired, they are more quickly and easily trained because of the convenience of kitting. This can greatly reduce costs and onboarding time for new hires.
- Reduced line storage requirements. As authors of a Caterpillar case study note, the increasing variety of parts necessary for manufacturing components/products can cause storage problems on the line. This increases the risk of waste and excess raw materials. Further, traditional delivery methods force lineside storage, and this makes operator walking and searching times much higher.
- Increased customer satisfaction. Because kits help streamline operations, manufacturers can fulfill customer orders more quickly and efficiently.
When companies outsource
their kitting needs, they can realize even greater efficiency and output.
At the same time, they can avoid some common challenges of kitting, one of
which is ensuring timely and sufficient supply availability.
Kitting offers a solution that can help increase
efficiency from supply chain to final product, cut costs, and optimize operator
output.
Friday, February 26, 2016
Contract Assembly: Meeting Your Quality Control Standards
When your company depends on third-party
manufacturing and contract assembly, nothing less than the best is acceptable.
While price is important, especially considering the ultra-competitive business
landscape, quality is non-negotiable. How do you know that your contractor will
deliver optimal results?
Before entering into any agreement with a third-party manufacturer or assembly
contractor, it is important to inquire about their track record of success
– and double-check with documentation. Another critical area to check: do they
have ISO9001 and
AS9001 certifications? If they do, that also means they have:
- Documented – repeatable – quality management processes. To earn accreditation, companies must demonstrate that they have clearly defined quality control processes. The processes in each area or business function are documented, and potential trouble spots are identified and resolved immediately. Customers/clients can be assured that their assembly needs are in competent, certified, hands.
- Systems for continual improvement. Whenever man and machine operate together, there are going to be occasional errors. To be certified, contractors must ensure that these occasions are few and far between, and more importantly, that they are flagged, investigated, and resolved. Further, steps are taken to mitigate or eliminate the chances of that error recurring.
- Ongoing training and support. Staff members are fully trained and receive ongoing education so they remain on the cutting edge of their field. This includes training required to do their current jobs more effectively and efficiently, as well as learning new skills to tackle increasingly complex customer demands.
- Ongoing internal quality audits. These audits ensure that employees follow all safety and quality control standards as set out in the quality management process. There is a strict procedure contractors must follow.
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