PEOPLE & SKILLS
MANUFACTURING COMPANIES IN the US , the UK and Europe are bringing production back to home shores . A desire to improve quality coupled with rising wage costs overseas have sparked a reshoring trend that is set to continue for years to come . In a report conducted by law firm Squire Sanders , one in six British companies have ‘ reshored ’ production in the last three years and the figures follow a similar trend in the US and across the rest of Europe .
However a report on the new phenomenon shows that while a growing number of companies are returning to the US , the UK and Europe to do their manufacturing , the trend is smaller and less significant to the economy than it appears .
‘ A desire to improve quality coupled with rising wage costs overseas have sparked a reshoring trend that is set to continue for years to come ’
The authors of the report say they had been intrigued by the large number of recent media stories suggesting a small stampede back to home shores by manufacturers but had thought much of the evidence seemed anecdotal . So they began tallying up the number of reshoring cases they found . “ We saw that the number of cases was definitely growing , and so then that begs the other question , which is , well , what ’ s the economic impact of that ?” says Patrick Van den Bossche , a partner at A . T . Kearney .
In the US , there were just 64 reshoring cases in 2011 , while this year there will be around 300 , with electronics and transportation equipment companies leading the way . High-end apparel surprisingly was the third most common sector . The driving factors include energy costs lowered by the shale oil boom and a closing wage gap with China .
But Van den Bossche says that while more companies have good reasons to consider coming home , in context , the impact of the small number actually returning is less significant than it appears .
“ You see more manufacturing
16 February 2015