The United States has a long history of manufacturing excellence, from the railroads to the automobile and much, much more. But over the years, companies began outsourcing manufacturing operations overseas, largely due to cheaper labor. And when the “great recession” hit between 2007 and 2009, manufacturing took a big hit in the United States. Factories closed, two of the “big three” domestic automakers filed for bankruptcy protection and many skilled workers were laid off from their positions as output dwindled.
Needless to say, but it wasn’t a good time for manufacturing.
Years later, manufacturing is coming back in this country – and coming back with a vengeance. Are you planning to be a part of the resurgence?
Before you answer that question, let’s take a look at how manufacturing is back on the rise, and just how important it is to the U.S. economy:
- It’s estimated that every single manufacturing job creates about three additional jobs in other sectors.
- For every $1 of goods that manufacturing produces, an additional $1.48 is generated for the economy. That’s believed to be the highest multiplier of any U.S. economic sector.
- If you eliminated all other sources of the U.S. economy, just manufacturing alone would be good enough to make it the 10th largest economy in the world.
- It’s estimated that manufacturing produces $1.8 trillion worth of revenue each year, or roughly 12.2 percent of the U.S.’s total gross domestic product (GDP).
- Nearly half of all U.S. exports (47 percent, to be exact) are a byproduct of manufacturing.
That’s a look at how important manufacturing is to the U.S. economy, but it’s worth noting that jobs in this sector are highly regarded as well. It’s estimated that the average manufacturing worker is paid $77,000 per year. The vast majority of these jobs also include medical benefits and are among the most highly tenured in the entire job market. And as manufacturers reduce outsourcing and offshoring and begin to bring operations back domestically, the number of manufacturing jobs will likely only continue to grow.
Today, it’s estimated that there’s some 12 million manufacturing jobs in the United States. It’s a far cry from the estimated 17 million that there were in the early 1990s, but as we’ve mentioned already in this post, that number is increasing and will continue to increase as operations improve and expand.
So, we’ll pose the question again – do you want to be a part of the manufacturing resurgence in America?
Here’s a look at why manufacturing is coming back:
- High global demand: It’s simple economics – supply and demand. The economy is improving, and so is the demand for American-made products. When there’s demand, someone has to supply it – and product demand is music to a manufacturer’s ears.
- No more outsourcing? OK, so outsourcing may still be going on – but it is not like it was in previous years. That’s because it isn’t so much of a cost savings to outsource production to China anymore, as wages have jumped in the Asian nation. That means more companies are moving production back domestically, which is obviously good news for manufacturing in the U.S.
- Attracting other nations: Not long ago, it was the U.S. outsourcing labor to China and other countries. Now, many foreign countries are actually recognizing the benefits of U.S. labor and outsourcing their operations to the United States.
To be a part of this manufacturing resurgence, however, you can’t just open a shop and expect things to take off on their own. In addition to needing the right people to work in your operations, you also need the right equipment to help streamline operations and produce product. The latter isn’t always as easy as it seems. That’s because product development is tough. And when a potential customer or product end user has certain expectations for how a product will perform and what types of things it will do over time, you have to have the knowledge and know-how to take the product from its concept stage to its manufacturing stage. In between, there’s the design stage, engineering stage and prototyping stage of product development.
Yes, there are challenges in taking a product from concept to production. And even with the right people and equipment, there’s still risk involved. So just how do you go about minimizing risk and streamlining operations, while keeping time to market on point? Here’s a look:
- Lower the financial commitment: No, we’re not talking about underpaying your staff or cutting corners when it comes to the quality of your product – we’re talking about saving some money while you get your manufacturing operations kick-started or expanded by investing in previously owned equipment. At credible previously owned equipment outlets such as Bid on Equipment, we have a variety of lathes, CNC machines, rapid prototyping systems, milling machines and turning machines that are like new in every way but the price. Let’s face it, with production equipment ranging upwards into the hundreds of thousands of dollars, starting production or expanding production capability isn’t exactly something that’s simple to do. That’s why buying previously owned equipment can behoove a company in such a position – not only are they saving money when it comes to overhead costs, but they’re also reducing the risk involved in doing so.
- Partner with a broker: A good broker can pay big dividends when it comes to manufacturing. How? By assisting you with the planning and development of your operations versus you going about it blindly and attempting to plan things on your own. To review, a broker is an individual who buys and sells goods, or in this case equipment, for others. Brokers can also arrange or negotiate plans or deals with others. Bottom line – a good broker can be a huge asset to your manufacturing operations by reducing risk and, ideally, saving you money.
To be or not to be… a part of the U.S. manufacturing resurgence, that is the question. It’s a booming field right now, which certainly makes it an attractive one. But it’s not an industry that is easily mastered. That’s why it’s important to surround yourself with people who know what they’re doing and equipment that you can rely on, whether you’re expanding your capacity and operations to produce more or you’re starting up manufacturing operations altogether.
So are you planning to be a part of the resurgence? Make sure you know what you’re doing, or what you’re getting in to. For more information, and to browse a wide variety of equipment, contact Bid on Equipment today.