Whirlpool is moving some of its washing-machine production to a plant in Clyde, Ohio, from one in Monterrey, Mexico, reports The Wall Street Journal (Dec. 20, 2013). The shift—another sign of the trend for U.S. manufacturers to bring back some of their production from abroad—will create 80-100 jobs at the Clyde plant, which currently employs about 3,300 people and is the company’s biggest washing-machine factory.
Wages for production workers in Clyde, typically around $18-$19 an hour, are roughly five times higher than in Monterrey. But the shift should lower costs overall. The Clyde plant is more automated and electricity costs are much lower than in Monterrey. Whirlpool also expects to save on transportation because the products won’t have to be shipped across a border before going into the company’s North American distribution network. Like many other companies, Whirlpool is trying to make products closer to where it sells them. That reduces the time needed to respond to changes in demand.
Since 2010, companies have created more than 80,000 manufacturing jobs by moving production to the U.S. from foreign countries, states the head of the non-profit Reshoring Initiative. “The U.S. continues to lose other manufacturing jobs to offshore plants, but those losses now are being offset by inflows,” he says, adding: “We’ve stopped the bleeding.”
Apple, which relies heavily on plants in China for its top selling gadgets, recently began making some of its high-end Mac Pro desktop computers in Austin, Texas. Wal-Mart Stores Inc. has been prodding some of its suppliers, including makers of socks and light bulbs, to provide U.S. made alternatives.
Classroom discussion questions:
1. Why are more firms “reshoring” in recent years?
2. Name several companies (besides the 3 in this article) that have brought manufacturing back to the U.S.