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The Reformed Broker

Are US manufacturers quitting China?

Citing rising labor costs, many US manufacturers say they're planning to leave China and come back to the United States.

By Guest blogger / April 24, 2012

In this January file photo, Gina Johnson performs leak tests on hydraulic fittings at the Eaton Corp. plant in Berea, Ohio. According to a recent survey, many US manufacturers currently based in China might be coming home.

Mark Duncan/AP/File

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LOL, I don't know, sorry, been a long day and I'm not getting enough servings of carbs on this new Paleo thing I'm doing....

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Joshua has been managing money for high net worth clients, charitable foundations, corporations and retirement plans for more than a decade.

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But this was kind of interesting on how American companies are finding better manufacturing locales than China here in the States:

“Ten years ago, everyone thought Mexico would be the place for expansion,” says Pete Selleck, who heads Michelin’s North American operations. “But we can’t tolerate the level of instability there.” As for China, labor costs are rising quickly, he says, and “there’s still concern about protecting intellectual property.” A new survey of 106 big U.S. manufacturers by the Boston Consulting Group, to be released Friday, picked up a similar sentiment. Thirty-seven percent of the companies said they plan to bring production back to the U.S. from China, or are actively considering it. Seventy percent said sourcing in China is more costly than it looks on paper. BCG also sees some additional interest in the U.S. from manufacturers in Europe. It says they are attracted to higher productivity here and a cheap U.S. dollar.

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