60,000 Manufacturing Plants Closed Since 2001

a reply to: seentoomuch

As long as globalisation lasts, the end product will be in having to compete with the low wage economies where the jobs are outsourced to. At first the economic advantage was with us, and it takes a few years to loose it in the" long rundown" . It doesn't happen overnight so its not a great shock. But at some stage, if nothing is done, you will have to work for the same wage rate as the outsourced jobs. This was the whole point of it in the first place, to control wages, and inflation. Now non Union labour will do a job for a fraction of the old labour rate. In a few more years, any one with a few more bucks than the rest will have all the power.

I can see a point where to compete, the political system, of say China and the U.S.A. will have to be the same , the only difference will be that to protect Capitalism , it will have to operate a one party system, with rigid social control . The difference between main Political parties, now days is negligible, as that point draws close.

a reply to: openminded2011

The problem is we have ultra cheap labor overseas and no protections against importing the cheap goods to level the playing field

That is a symptom of the real problem we have : Like you said , corporations are under such pressure and they have to infinitely increase profits years after year for the board of directors to a point that they get desperate and further go into grey areas.

The real problem is that MEGA Oligopolies who are so desperate to infinitely increase profits for infinite years also have the power to create our regulations via lobbying. Hence we continue to go further into the grey because its the only way that MEGA Oligopolies can survive with unrealistic expectations.

originally posted by: seentoomuch
a reply to: JeanPaul

My company produces products that are sold worldwide for many years now. They are all made in the USA. The lowest paid employees earn a living wage but most of the employees earn much more. We have a great 401K plan, paid vacation, paid sick leave, health insurance/dental and really nice christmas bonuses. My husband passed several years ago, he was a tax lawyer and was not involved with the business though he did give advice from time to time. My son is grown and is a psychologist and works in the education field.

So tell me, what do you do for a living? What about your children? What are your plans?

Or have you already caved?

I haven't given up on America, have you? If I, a non-academic can have a company with made in america products surely you must be able too? I know you will claim this is micro, what would it take to make this macro? The norm for America?

STM

Let me know when your company fires you and moves offshore, as has happened to millions of people. People you don't care about because you still have yours. Your sons job is safe, education cant be offshored or outsourced just yet. Especially school psychiatrists. That's a booming industry.

I'm not "giving up on America". I'm criticizing perhaps 85% of the neoclassical economists who have sold out the American working class with bunk theories of "free trade". This isn't about "slamming America". Quite the opposite actually. It's not a partisan issue.

Anyhow, it's very odd that you work in manufacturing and don't understand what has been going on since the 1970's. I'd take the time to paint a clear picture, with peer reviewed studies, charts and graphs but it sounds like you have your mind made up- that the US is a meritocracy and living wage jobs are flowing like milk and honey. You think people without living wage jobs are in that position because they're stupid, lazy or ignorant. Right? There's no need to wrap "conservative values" around this issue.

What do I do? I own capital. Invest. Both in real estate and traditionally. Because I understand how the system actually works. Also, because I inherited $10k and was able to make it grow. Quickly/high risk. I understand how our system works. Intimately. And take advantage of this hard earned knowledge. And luck.

a reply to: onequestion


"This is the biggest issue in America right now. Cities are crumbling across the country, I know, I've seen it with my own eyes. More people in prison than ever, the middle class is shrinking faster then ever and we have no purchasing power which means we have no leverage as a population in the markets to call any shots,"

Well, the rabbit hole goes really and this is just the tip of the iceberg...... Of which I'm a victim.

Manufacturing jobs also include, HR, ACCOUNTING, LEGAL DPT, all ENG DPTs, QUALITY DPT, SHIPPING/ RECIEV DPT, PRODUCTION FLOOR including Management.

At the same time, we have mass immigration issues meaning, legal & illegal flooding the job market and housing at the exact same time....

I spent 6 months looking for just a room for $400.00 / month and as soon sdbone came open it wss gilled within 15-20 mins of it being posted,...yes, I'm dead serious.

ALL resources are maxed out~! Even for senior citizens, 6 months to a year!!

IMO.....alll of this is by design and it's not over yet....and it's not going to get better fior awhile, USSR stated long ago to the USA ....."we will take you from without , but from within,"

As i look at the condition we're in today,.,.makes me wounder...

a reply to: JeanPaul

Let me know when your company fires you and moves offshore, as has happened to millions of people.

I own the company.

Maybe some of y'all should get together and start your own company too? Develop a unique product, watch the cost of production, price it right and work, work, work to get it off the ground. Once it's flying it becomes a balancing act but you'll get used to it. That imho would be the best job security there is. As for offshore, pffft. The quality would suffer and the employees are like family, not gonna happen.

STM

originally posted by: seentoomuch
a reply to: JeanPaul

Let me know when your company fires you and moves offshore, as has happened to millions of people.

I own the company.

Maybe some of y'all should get together and start your own company too? Develop a unique product, watch the cost of production, price it right and work, work, work to get it off the ground. Once it's flying it becomes a balancing act but you'll get used to it. That imho would be the best job security there is. As for offshore, pffft. The quality would suffer and the employees are like family, not gonna happen.

STM

As you said, your micro experience doesn't reflect the macro trends. You could be the most benign owner in the world, pay your workers $45 an hour...it doesn't mean much in the overall American economy. The trend since the 1970's has been an expanding practice of offshoring, with an expanding influx of "insourced" labor coupled with technological unemployment and various financial crisis'. Not to mention the so called "fight against inflation" when interest rates are intentionally raised (when unemployment gets too low).

Systemically, the American economy isn't providing enough living wage jobs. No matter what, no matter the peoples education or motivation there will be millions left behind without living wage jobs.

originally posted by: onequestion
How can you expect someone coming out of highschool to know what the market is or how it works and what's actually in demand?

I'm not sure that it matters. In my mind career happiness is far more important than any other factor. The goal of college shouldn't be to maximize earnings, it should be to learn how to work in a field that you enjoy. Maybe a well paying but miserable job will make you happy but I think that's true for a smaller portion of the population than we pretend it is.

I remember in high school all of the aptitude tests told me to be a farmer, which is something I've never had interest in.

originally posted by: pl3bscheese
I'd start with IQ, then move to historical use of higher education, then end with the inevitable dumbing down and business-like nature that has evolved from attempting to really feel like everyone should be super-smart, when they never were or could possibly be. Seriously, it makes no damned sense whatsoever.

The problem is that IQ doesn't mean anything. Take it from someone who was told by all of the various testing that they were super smart. Brains and college don't mean anything, willingness to sit in a classroom is what college is all about.

originally posted by: Xtrozero
Good mentors?

I guess they are in short supply... I mentor my own kids to succeed.

Unfortunately, this means that you have to have all the answers. How can we pass on knowledge to succeed when neither of us has found the magic formula? For that matter it's well known that two people who work in the same field with the same aptitude will end up at different places in their career, success is more than work ethic and wisely choosing a career.

None of us have the perfect knowledge necessary to act as a mentor.

originally posted by: LDragonFire
Isn't the main problem filling those positions based on drug tests, background checks, and financial checks?? In Texas? I remember reading a article years ago that they had to close a refinery because no one in the area could jump the hoops required to get hired?

I suppose this varies by area. In my town which is drug ridden the most employable asset I have is that I can pass a drug test.

The credit checks are what I assume get people in general, with the type of debt the nation has today that takes a toll on credit worthiness.

originally posted by: openminded2011
There are two things going on that I can see that are driving this.


First, the CFOs of companies along with teams of accountants, are squeezing every last penny out of companies. And the reason is twofold; the shareholders DEMAND it, and white collar greed drives it. So they strip the companies down to the bone, cutting bonuses for workers, benefits, overtime, throwing the older higher paid workers out in the street to get cheaper people. And it NEVER ends, until the company just implodes when they cant extract any more.

If they're a public company they have a legal obligation to maximize shareholder return.

I'm actually kind of on the fence about this issue.

Probably because I'm not very good with Economics, I just don't understand how these kind of problems can be solved.

For instance, we all love our iDevices very much, but how much would that iDevice cost if it was to be manufactured here in the U.S. where minimum wage is like hitting $15 USD/hr?

I'm actually in OEM manufacturing business for electronic components. I'm telling you guys straight up, there is no way any of us or manufacturing facilities like us can survive in this day and age by putting an assembly plant here in the U.S. It is simply not possible.

Guang Zhou, Da Lian, inner China is where you need to be. Otherwise you'll need to start up a plant in Africa or Mexico, there is no way a commercial scale manufacturing plant can compete with those kind of low monthly salaries.

The average Chinese worker at Foxconn, or plants similar to Foxconn like my company, makes about 1,800 RMB to 2,300 RMB a month. This is like average assembly worker wage in China now days.

Even at the highest amount of 2,300 RMB a month, that's roughly equivalent to about $380 to $400 a month in USD. Where in the hell can you find workers here in the U.S. that are willing to work for $400 a month? How can they survive on that?

The problem is, in China, if you make 2,300 RMB/month, you could get by in a rural city quite easily and comfortably I might add. So the workers are actually quite happy to make those peanuts, because the alternative for them, is either to starve on the street or do swat meets for life.

To me, it's about being real.

For business men, they are in it to make money. If I start a company, whatever it may be, I'm opening it for the sake of getting myself rich. I'm not here to save the planet, we're not here to save the Manatees guys... quoting Ben Affleck lol.. we're here for one reason, to get filthy rich. At least, that is most entrepreneurs line of thought, when they want to start a business.

Quite obviously, businesses tends to gravitate towards countries and laws that are either more lax towards their practice or extremely beneficial for their bottom line.

If you are the CEO of a company and you were informed that you can make $20 million more for your company, by outsourcing the manual labor work to China, wouldn't you do it?

It's more like, businesses are doing whatever that is beneficial for themselves. Is that truly wrong?

We want the jobs to come back, but how? iPhone 6 manufacturing cost from Foxconn is like $4.50/unit, you think we can compete with that here in the U.S.? I mean, I'm really just bad at Economics here, but like I said, I'm very curious to hear what other people's opinions are on this subject.

Like, how do you solve a worker wage at $400 USD/month overseas vs. an average hourly worker in U.S. makes at least $9/hr, 40 hours a week, that puts you at $1,440. There's no competition here.

Not only labor cost issues, but other laws as well. Tax laws, labor laws, environmental laws and regulations, manufacturing safety standards and what not, every little thing translates to a $. If by going overseas, establishing my manufacturing facility there, can save my company tons and tons of money.. then I must be stupid not to bring my empire over there.

You see, you want outsourcing to stop, then there must be incentives to keep said jobs here in the states. It all comes down to the bottom line.

If by keeping the jobs in U.S., it helps with the company's bottom line, they will do it.

If by keep the jobs overseas, it helps with the company's bottom line, then they will keep the jobs outsourced.

It's simple to me, but people just keep arguing about this with no obviously suggestions to resolve the problem from the core.

a reply to: truthseeker84

you do it with 1 word: tariffs

problem is, once you are already down the road to hell its kind of too late to jump out of the handbasket. But you can try. At least with trying you are putting up a fight.

I spent quite a bit of time in call center outsourcing. In that world its minutes: how much does it cost you per minute to have those calls handled. VOIP made stateside operations almost unneccessary entirely.

originally posted by: truthseeker84For instance, we all love our iDevices very much, but how much would that iDevice cost if it was to be manufactured here in the U.S. where minimum wage is like hitting $15 USD/hr?

Apple is on the record saying that they could manufacture Iphones in the US, paying good wages, and still make more than enough money to keep the company viable. Then again Apple already puts a HUGE markup on their products, they are not cheap.

I'm actually in OEM manufacturing business for electronic components. I'm telling you guys straight up, there is no way any of us or manufacturing facilities like us can survive in this day and age by putting an assembly plant here in the U.S. It is simply not possible.

Hardware may be different, that's not my area but a lot of the most successful software in the world is written in the US paying very good wages. That's business software like Office and entertainment software like League of Legends or Hearthstone.

Even at the highest amount of 2,300 RMB a month, that's roughly equivalent to about $380 to $400 a month in USD. Where in the hell can you find workers here in the U.S. that are willing to work for $400 a month? How can they survive on that?

Pass a law in the US that if you're selling a product in the US in exchange for access to our markets you either pay a tariff to minimize the competitive advantage of low wages or you build atleast some of the devices domestically. That would solve the problem. It would potentially make those devices more expensive, which reduces the buying power of those already making a good wage, but that's what increasing the minimum wage does anyways. It's all about lowering some peoples purchasing power while raising others resulting in a shrinking of the wealth gap.

we're here for one reason, to get filthy rich. At least, that is most entrepreneurs line of thought, when they want to start a business.

If you are the CEO of a company and you were informed that you can make $20 million more for your company, by outsourcing the manual labor work to China, wouldn't you do it?

Well, my goal is to start a software company after finishing school. I don't want to do it to get filthy rich, I don't really care about my economic standing beyond reliable food and shelter. I want to do my part to end unemployment and low wages in the country. If I can employ 10 people at a good wage I would be happy, that would be 10 fewer people in poverty. We have 50 million that need jobs right now, if just 5 million people, a mere 2% of our population could do this we would solve the problem.

Outsourcing to China goes directly against that philosophy, I would be taking the ability to employ people here and exporting it, hurting the country I live in and paying rock bottom wages that don't even help the people in the country I move to. That's the very definition of evil in this world.

originally posted by: Aazadan

Apple is on the record saying that they could manufacture Iphones in the US, paying good wages, and still make more than enough money to keep the company viable. Then again Apple already puts a HUGE markup on their products, they are not cheap.

iPhone 6 and 6 Plus margins start at 65.0% and 67.6%, respectively, before any costs for warranty, shipping, capital expenditures or other direct product costs. For a premium product on the market, that mark up is not HUGE by any means.

But what does that have to do with jobs being outsourced? Would you rather have Apple take that 67% margin and split 30% out so they can help take care of the jobless citizens in U.S.? Is that what people are honestly expecting Apple to do?

Might as well just give that portion of the earnings out to charity, at least you get some tax breaks? It's not helping with the whole outsourcing problems.

Hardware may be different, that's not my area but a lot of the most successful software in the world is written in the US paying very good wages. That's business software like Office and entertainment software like League of Legends or Hearthstone.

That's the problem. Software and hardware are completely two different industries. One is considered Intellectual Property while the other is basically open market for anyone willing to invest.

I think what we're forgetting to discuss here is competition.

Pass a law in the US that if you're selling a product in the US in exchange for access to our markets you either pay a tariff to minimize the competitive advantage of low wages or you build atleast some of the devices domestically. That would solve the problem. It would potentially make those devices more expensive, which reduces the buying power of those already making a good wage, but that's what increasing the minimum wage does anyways. It's all about lowering some peoples purchasing power while raising others resulting in a shrinking of the wealth gap.

While I can't really explain very well why that wouldn't work, I'm sure others can. What I CAN point out to you, is that, if what you've just mentioned actually works in the real world, it would of been done and everyone would have followed but it's not happening is it?

You can tariff that crap all you want, what you would end up doing is drive the business elsewhere. Why on earth would I buy a more expensive hardware in U.S.? Pay your stupid tariff? Why don't I just buy the same device overseas instead? Where they don't have this tariff and the product is actually cheaper?

You can't really stop consumers from doing that. Remember the whole iPhone 6 incident? Where it was first released, it wasn't available in China. Guess what? Everyone in China, who can actually afford an iPhone, bought one from the U.S. instead of waiting.

Same thing is going to happen, if you're tariff is going to make the products more expensive in the U.S., people would just seek alternative sourcing for that.

While you maybe able to stop business from selecting a cheaper route to make more money, you can never stop the average consumer from always looking for the sweater deal.

Well, my goal is to start a software company after finishing school. I don't want to do it to get filthy rich, I don't really care about my economic standing beyond reliable food and shelter. I want to do my part to end unemployment and low wages in the country. If I can employ 10 people at a good wage I would be happy, that would be 10 fewer people in poverty. We have 50 million that need jobs right now, if just 5 million people, a mere 2% of our population could do this we would solve the problem.

You sound young and naive, but what you've said is very admirable. I do respect your views.

However, I can pretty much tell you flat out that that's not how the real world works. If all business owners are like minded as you are, we wouldn't be in this situation.

The real world however, doesn't work that way.

Outsourcing to China goes directly against that philosophy, I would be taking the ability to employ people here and exporting it, hurting the country I live in and paying rock bottom wages that don't even help the people in the country I move to. That's the very definition of evil in this world.

Business is not about philosophy, it's about the bottom line. Like I mentioned above, you sound young, so perhaps your blood boils hotter and faster than me when it comes to things like this, but as I'm getting older and more jaded, I can tell you that nothing matters other than the bottom line.

Not this country, not my immediate next of kin, no one and nothing matters at the end of the day when it comes down to the bottom line.

If someone else tells you otherwise, to me, they haven't owned a business before.

Again, I'm not advocating here that we should all source jobs to overseas and screw the U.S. citizens. I'm not saying that.

I'm just saying that, as of yet, I haven't seen anyone offering a better solution to this mess.

originally posted by: onequestion
This equals 4.2 million high paying jobs lost.

"Free trade" is not free. Our free trade policy encourages production to leave the country. We've lost millions of manufacturing jobs. More than 60,000 manufacturing plants were closed between 2000 and 2010 as production moved overseas. These costs are real.

And I'll bet the Corporate Apologists will say they left because of the Onerous Regulations and Taxes...

1) Big Business main concern is profits to its owners and shareholders.
2) There is no limit to the profits they seek as many business owners admitted.
3) If you can make 1 million in profits here and 10 million in Communist China, then it is a no brainer put puppets in power promoting "Free Trade"
4) Majority of jobs were outsourced to China and Mexico when the Economy was overheating as Alan Greenspan put it and people were making money hand over fist. They did not leave because of a bad economy. They left because there was more money to be made.
5) Majority of Regulations are written by Corporate Lobbyists to kill off their competition
6) Big Business apologists say that if taxes are raised, then they have to increase the cost of their goods to maintain the same profit margins, so clearly taxes are passed on to the consumer and they do not pay for it anyway.
7) With China, they can employ cheap labor that was kicked off their land by the millions to go make widgets and sell it back to Americans at inflated prices and make bank.

As an example of inflated prices

time.com...
Apple’s $649 iPhone 6 Reportedly Costs $200 to Make

Stocks have gone through the roof for investors and owners alike.

THE AMERICAN, economy, is a joke. The divide between rich and poor, grows more and more each day that passes..

Manufacturing will not return to USA, until something changes the world, more then likely a war etc.

I do not think we will have another conventional war on a WORLD scale anyway so I do not even think that will happen..

Only other way we can get manufacturing back to the USA, is changing the system, and I do not see that happening either, considering bad things has happened to people trying to do that thru out out american history..

Also since we live in a cheap world economy, people want cheap products, quality is not as important as it used to be etc.

(I don't feel like writing a essay on that statement.)

Unless your a skilled professional in one form or another in this economy of course in the SERVICE industry, your not worth anything.

Each day that passes and ends surprises me. Their is a house of cards being built and eventually it is going to come crashing down, until we focus on trying to improve our economic health in America, and many other faucets of our society, this fact of life, will continue..

No one really seems to care, it is as if in my opinions our politicians and leadership already know its all a farce, and are just along for the ride.. I mean they know it cannot be fixed and if anything they are just trying to slow down the inevitable.

Hell let us not even start discussing the state of the Social security benefits for my generation...



Also I think the big car manufacturers who are paying so many people pensions for the next 50 years or more, are the next to have serious problems...

originally posted by: rickymouse
I totally agree, this is the biggest threat to the security of the United States that we have. Along with the jobs leaving so has our money, China and other countries are taking it away a penny at a time.

When you get entangled with a Communist Country, eventually you run out of other peoples money - The American Consumer.

The Chinese Government owns the Biggest Corporations in China, they are called State Owned Enterprises
And they kicked off 250 million Citizens from their self sufficient lands to go build widgets for the fascists running this country.

www.nytimes.com...

China’s Great Uprooting: Moving 250 Million Into Cities

BEIJING — China is pushing ahead with a sweeping plan to move 250 million rural residents into newly constructed towns and cities over the next dozen years — a transformative event that could set off a new wave of growth or saddle the country with problems for generations to come.

The government, often by fiat, is replacing small rural homes with high-rises, paving over vast swaths of farmland and drastically altering the lives of rural dwellers. So large is the scale that the number of brand-new Chinese city dwellers will approach the total urban population of the United States — in a country already bursting with megacities.

And the Propaganda in this country has been in full swing where if you do not go along with these plans corporations have, well, you are a commie. The irony.

The tactics being used is to attack Food Stamp Users and those on welfare as one example, of which the majority that receive them are working.

Food Stamps allotted per person is actually down from years passed, though the total budget has increased from these "Free Trade" policies.

I remember when I was younger 30 years ago, a guy down the street was using food stamps while going to college.

Today, if you are a single male, you get nothing.

a reply to: truthseeker84

If it only cost 4.50 a unit why are they charging 600?

How couldn't they afford to make them in the US?

originally posted by: truthseeker84
While I can't really explain very well why that wouldn't work, I'm sure others can. What I CAN point out to you, is that, if what you've just mentioned actually works in the real world, it would of been done and everyone would have followed but it's not happening is it?

It has been done in the past. We're actively preventing it these days with free trade agreements which specifically state that we won't do such a thing.

You can tariff that crap all you want, what you would end up doing is drive the business elsewhere. Why on earth would I buy a more expensive hardware in U.S.? Pay your stupid tariff? Why don't I just buy the same device overseas instead? Where they don't have this tariff and the product is actually cheaper?

Because when you put up those types of barriers, other countries do the same to your products in retaliation which solves the issue. Customs is usually pretty decent at inspecting products too, they don't get everything but they get enough that you can make it cheaper for the person to just buy domestically.

You also have to take into consideration that wages have differing purchasing power in different areas of the US. Sure, it's more than $480 per month but if manufacturing targeted the areas with low cost of living they could set up shop for a reasonable price in the US. In fact here in my town is a small hardware manufactuer. Yei Technology, they build motion capture hardware and health care equipment they exist in this town specifically due to the low cost of living.

However, I can pretty much tell you flat out that that's not how the real world works. If all business owners are like minded as you are, we wouldn't be in this situation.

I'm well aware of this fact. It also wasn't always this way, a generation ago it was a much more symbiotic relationship between employers and employees.

Also, worth mentioning, most business owners are not very good at becoming filthy rich. The failure rate for small business is astronomical and the majority of those who do make it end up well off but certainly not in the class that I would consider wealthy.

I can tell you that nothing matters other than the bottom line.

The bottom line is very important. If the company doesn't turn a profit it can't keep people employed. However once your business reaches the point that it can comfortably sustain staying in business and reinvest in itself, additional revenue matters little. If a business needs $50 million per year to do the above and it's making $100 million, is it really that important to move things to China and shift your profit margin from $50 million to $70 million?

originally posted by: onequestion
a reply to: dreamingawake

Theres no manufacturing jobs left to go overseas.

Good Point
It is a "Service Economy" now.
How would China Walmart sell their widgets from China?
We may as well cut out the middle man and all order from Chinese Corporations.

originally posted by: seentoomuch
a reply to: JeanPaul

Let me know when your company fires you and moves offshore, as has happened to millions of people.

I own the company.


STM

Not to be crass, but that sort of explains your position.

1) Wall Street Bankers defending their fraudulent derivatives.
2) Cops defending their killing of defenseless people.
3) Politicians defending their corrupt policies to make bank.

I am an not saying you run a corrupt business, but it is human nature to defend your self interests.

It is self interest and EGO rather than looking at the best interests of the whole nation and where it is headed.
Our nation is divided more than ever with this Ayn Rand type disease where it is all about ME and what I am entitled to. What about the nation called America and its people?

I do quite well for myself, but see what is happening and and am worried about out nation and its people.

Agreed. I'm leaving to travel and further my Fine Art experiments. Not something best done in the States, IMO.
Tragic because Americans deserve more fine art....

a reply to: jacobe001
America and it's people ,

Have been involved in the biggest, most perfect, and insidious public relations campaign since at least 1910.it involves churches, schools, and private business....
AMERICA...It's is better known as the land of the snakes.....
...and I think the rest of the world bought the lie that we were special, too...
The big question was/is how to control people. It's unknown if the experiment is over or if any results have been found....

That's what happened.