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This would make sense if there were a single labor market. There isn’t, so this simply increases prices (even for domestic goods, as raw materials are frequent
by sneak 1y ago
This would make sense if there were a single labor market. There isn’t, so this simply increases prices (even for domestic goods, as raw materials are frequently imported).
There is no meaningful path to restoring much of the US’s lost manufacturing capacity. The rent is too damn high, and the cost of goods is rising quickly as well. Labor is expensive and becoming moreso daily. Manufacturing in the US can never compete with SE asia even with 50% tariffs due to the gigantic disparity in the cost of labor.
It’s not going to increase wages, it may even result in even more offshoring due to the increases in cost for raw materials.
- hippo22 1y agoLow labor costs are not why goods are produced in China. That viewpoint is outdated. Goods are produced in China because they have the most capacity and expertise. Don’t believe me. Believe Tim Cook: https://m.youtube.com/watch?v=2wacXUrONUY https://m.youtube.com/watch?v=2wacXUrONUY
- esseph 1y agohttps://www.molsonhart.com/blog/america-underestimates-the-difficulty-of-bringing-manufacturing-back https://www.molsonhart.com/blog/america-underestimates-the-d...
- Supermancho 1y ago[dead]
- sneak 1y agoOh, that too. China is the best place to manufacture most precision goods today, period, independent of labor costs. But even if you could wave a magic wand and put the USA on equal footing in terms of skills and experience and capability, it would still cost several times more to make the same goods in the USA due to the labor costs (and labor-adjacent overhead costs like workplace safety). Both would need to be solved, and I think that solving either one alone is already basically impossible on any short- or medium-term timescale. A tiny bandaid like tariffs isn’t going to move the needle.
- jimbob45 1y agoHe’s giving that speech in China. It’s impossible to know if he’s glazing or not. Either way, I would want to hear him commit to building those factories in the US if education was not a factor. I suspect real estate costs, unions, OSHA, and US wages are bigger factors than he’s letting on. Still, I’m not going to fault the man for complimenting China while speaking to a Chinese audience.
- hippo22 1y agoApple had a lot of supply chain issues when trying to manufacture in the US. E.g. they failed to procure enough screws: https://www.nytimes.com/2019/01/28/technology/iphones-apple-china-made.html https://www.nytimes.com/2019/01/28/technology/iphones-apple-...