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Private Briefingwith WILLIAM PATALON III, Executive Editor
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The U.S. economy in 2013 should get a badly needed push from the acceleration of an improbable trend - the return of offshored manufacturing jobs to America.
Often referred to as reshoring, the trend started to gain traction this year, but is attracting more and more interest from manufacturers who just a decade ago couldn't move production to China and other foreign countries fast enough.
Companies rushed to send work abroad to take advantage of cheaper labor costs as well as to have factories closer to customers in rapidly expanding Asian economies.
Some companies did improve their bottom line, but at a great cost to the U.S. economy: America lost nearly 6 million manufacturing jobs between 2000 and 2010.
Yet calculations that favored the offshoring of manufacturing just a few years ago no longer add up. Some argue they never did, as offshoring turned out to have many hidden, unforeseen costs for many companies.
"There was a herd mentality to the offshoring," John Shook, a manufacturing expert and the CEO of the Lean Enterprise Institute, told The Atlantic. "But it was also the inability to see the total costs-the engineers in the U.S. and factory managers in China who can't talk to each other; the management hours and money flying to Asia to find out why the quality they wanted wasn't being delivered. The cost of all that is huge."
Now jobs once thought lost forever are starting to return to the U.S.
According to a Boston Consulting Group survey taken in February, 37% of U.S. companies with sales of $1 billion or more are either planning on reshoring some production or actively considering it.
Reshoring already has reversed the long, steady decline of manufacturing jobs in the U.S. Since 2010 America has added 500,000 manufacturing jobs, an increase of 4.3%.
With the disadvantages to manufacturing overseas growing each year, it's no wonder reshoring is becoming popular:
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