Trump tells manufacturers he will cut regulations, taxes, but must reshore

January 23, 2017 by Leave a comment

reuters

Reuters

By Roberta Rampton

WASHINGTON (Reuters) – U.S. President Donald Trump met with a dozen American manufacturers at the White House on Monday, pledging to slash regulations and cut corporate taxes, but warning them he would impose taxes on imports if they move production outside the country.

Trump, who took office on Friday, promised to bring manufacturing plants back to the United States – an issue he said helped him win the Nov. 8 election – and has not hesitated to call out by name companies that he thinks should bring outsourced production back home.

He asked the group of chief executives from companies including Ford, Dell Technologies, Tesla and others to make recommendations in 30 days to stimulate manufacturing, Dow Chemical CEO Andrew Liveris told reporters.

Trump, a Republican who took over from former Democratic President Barack Obama, was expected to sign executive orders later on Monday to renegotiate the free trade agreement between the United States, Canada and Mexico, and to formally withdraw the United States from the 12-nation Trans-Pacific Partnership.

The new president told the CEOs that he would like to cut corporate taxes to the 15 percent to 20 percent range, down from current statutory levels of 35 percent – a pledge that will require cooperation from the Republican-led U.S. Congress.

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Trump asks the question: Which do you like better Made in America or Made in the USA?

January 11, 2017 by Leave a comment

Trump asks the question: Which do you like better Made in America or Made in the USA?

 

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Made in America? 5 charged with fraud in alleged boot scheme

September 16, 2016 by Leave a comment

Made in America? 5 charged with fraud in alleged boot scheme

boot-fraud
By: John North, WBIR, September 16, 2016 (Photo Credit: Spc. Stephanie Ramirez/Army)
Executives and employees at Tennessee defense contractor for years assured the U.S. military that the boots they made for troops came from America when in fact they’d been shipped from China, the U.S. government alleges.

Five employees and principals of the former Wellco Enterprises Inc. were indicted this week in U.S. District Court in Greeneville, Tennessee. They appeared Thursday before U.S. Magistrate Judge Clifton Corker, pleading not guilty.

The defendants: Vincent L. Ferguson, 65, of Knoxville; Matthew L. Ferguson, 40, of Lenoir City; Kerry J. Ferguson, 35, of Houston; Matthew H. Martland, 32, of Knoxville; and Stephanie L. Kaemmerer, 44, of Knoxville.

The five are free on bond pending trial. Counts against them include wire fraud, major fraud against the United States and smuggling goods into the U.S.

The charges allege the defendants conspired from December 2008 to August 2012 in a scheme to sell thousands of bogus boots to the U.S. government for troops. From 2006 through 2012, the Defense Department paid Wellco more than $138 million for military footware, according to the indictment.
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Manufacturing Has Come Back And More Gains To Come

September 2, 2015 by Leave a comment

Manufacturing Has Come Back And More Gains To Come

The U.S. manufacturing sector is coming back, we learn from the Federal Reserve’s industrial production report. Last month’s gain was 0.9 percent, more than making up all the ground lost in the early months of this year. Looking forward, production will continue to expand, but don’t expect a lot more factory jobs. Read more of this post

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Factory fire causes nationwide knish shortage

November 11, 2013 by Leave a comment

Gabila Food Products, Inc. shows their original Coney Island square knishs, which have been off the market for at least six weeks. A fire at a Long Island factory billed as the world’s biggest maker of knishes has led to a nationwide shortage of the fried, square doughy pillows of pureed potatoes and other fillings. (AP Photo/Gabila Food Products, Inc.)

Gabila Food Products, Inc. shows their original Coney Island square knishs, which have been off the market for at least six weeks. A fire at a Long Island factory billed as the world’s biggest maker of knishes has led to a nationwide shortage of the fried, square doughy pillows of pureed potatoes and other fillings. (AP Photo/Gabila Food Products, Inc.)

COPIAGUE, N.Y. –  A fire at a factory billed as the world’s biggest maker of knishes has created nationwide shock and oy for those who can’t seem to find the Jewish treats anywhere.

Kvetching has been going on at delis, diners, food carts and groceries since the six-week-long shortage began, but lovers of the square fried doughy pillows of pureed potatoes may not have to go without much longer. The factory promises an end to the knish crunch by Thanksgiving, which coincides with the start of Hanukkah.

“Our customers … are calling us saying they are literally searching supermarkets and stores and they’re all asking when we’ll be back,” Stacey Ziskin Gabay, one of the owners of the 92-year-old Gabila’s Knishes, which sells about 15 million knishes a year.

A fire Sept. 24 at the Gabila’s plant in Copiague, Long Island, damaged the machinery that makes the company’s biggest seller — “The Original Coney Island Square Knish,” which also come filled with kasha or spinach.

Gabila’s, which also makes matzoh balls, blintzes and latkas, sells the knishes both online and at retail outlets around the country, with New York, Florida and California leading the sales.

“For the last month I haven’t had any knishes — my heart is broken,” said Carol Anfuso, a native New Yorker who has been without a knish to nosh since the BJ’s Wholesale store near her Atlanta home suddenly stopped stocking them.

But Anfuso didn’t learn of the shortage until she visited her sister for lunch at the Pastrami King restaurant in Merrick, Long Island, and found that it was out of stock, too.

Pastrami King owner Joe Yamali said he normally sells about 2,000 knishes a month.

“It brings you back to your childhood and they’re just so delicious,” Yamali said. “Gabila is square and fried. You bite into it and the potato oozes out. It’s very good.”

Katz’s Delicatessen, the 125-year-old landmark on Manhattan’s Lower East Side, ordinarily sells about 6,000 knishes a month.

“I usually get four to take home,” grumbled Brooklyn native Forrest Gurl. “Their crunchiness, their hard corners, the mustard and sauerkraut you put on them. You can’t beat a knish.”

Like most places, the round, baked version is still available. But Gurl harumphed a familiar sentiment of knish devotees: “Who gets round knishes?”

Jesse Hochberg, a retired IT employee, didn’t know there was a shortage until he got to the Katz’s counter.

“I miss them,” he said.  “It’s something I grew up with. I like the taste, sliced with mustard. … I always look for them, and I haven’t seen them recently.”

Katz’s chef Kenny Kohn has grown weary of explaining the shortage to customers.  Along with the pastrami sandwiches, he serves up a typical New York attitude to the ongoing complaints.

“Get over it! Get a life! It’s just a knish.”

Filed under Jobs, Labor, Made in America, Made in USA, Power of Consumers Tagged with , , , , ,

Made in America label stages comeback at U.S. stores

May 3, 2013 by 1 Comment

NEW YORK: When Roger Simmermaker went shopping for clothes at a Florida mall in the mid-1990s, he wanted to buy American, but to his frustration, he couldn’t find anything made in the USA.

The experience motivated Simmermaker, an electronics technician by trade, to write “How Americans Can Buy American” – a guide to finding products manufactured in the United States, which were a scarce commodity at the time.

Nearly 20 years after writing the book, he has seen a big change, with the pendulum in full swing back toward a wider choice of American-made products. They are often available without the expected higher price tag.

“It’s definitely easier,” says Simmermaker, 47, who lives in Orlando and works for a defense contractor. “Especially in the last year or so, things have really changed.”

Those who believe in buying American-made goods from US-owned companies say it creates jobs and boosts the economy through reinvested profits and taxes.

Profit-driven US companies have their own reasons for locating factories, but manufacturers of goods ranging from refrigerators and dishwashers to laptops and tablets are starting to bring some of their production home, affording more opportunities for consumers with the patriotic conviction that Americans ought to buy American.

Better still, that “Made in the USA” label may no longer carry such a premium price tag. That’s because production and shipping costs in China and other foreign manufacturing centers are rising. Shifting some manufacturing back to the United States doesn’t necessarily mean manufacturers have to raise prices to compensate for higher labor costs.

To be sure, many industries are still dominated by imports – toys and textiles, for example. Still, Simmermaker and others who believe in buying American are seeing a broad shift.

“Reshoring” advocates were thrilled earlier this year when Wal-Mart Stores Inc., the world’s largest retailer, announced it was throwing its weight behind the movement. In January, the chain – known for its extensive selection of imported goods – said it would spend an additional $50 billion over the next 10 years on American-made products, “helping to onshore US production in high-potential areas like textiles, furniture and higher-end appliances.”

Likewise, Apple Inc. said it planned to build some of its iMac line in the United States instead of China. Ford Motor Co., Coleman Co. (part of Jarden Corp. ) and Master Lock Co. (part of Fortune Brands Home & Security Co.) all have said they’re returning some manufacturing to the United States. The list goes on.

WHAT IT MEANS FOR CONSUMERS 

While few companies will move production for patriotic reasons alone, the public relations boost that goes with a decision to bring jobs back to the United States is gravy.

“They run the numbers and say ‘We can deliver just as cheaply from a US operation as we can from, say, China.’ It has some nice extra benefits,” says Dan Seiver, chief economist for Reilly Financial Advisors, a wealth management firm in San Diego, California. “Whatever credit goes with it is fine”

With little pricing difference, the impact on US consumers might not be that obvious. But Simmermaker and other advocates also contend that products made in the United States are often higher-quality and safer than those made elsewhere.

There is a decided upside for the companies, too. Making products closer to their end-market allows them to be more nimble in terms of customizing and delivering products.

That was the case with Spreadshirt, a Germany-based custom shirt maker that recently opened a plant in Nevada to supplement the output of its existing facility in Pennsylvania.

In 2011, the company was running its Pennsylvania plant around the clock. To keep up with holiday demand, it was forced to send some work to a plant in Poland, said Mark Venezia, vice president of global sales and marketing for North America.

But the company quickly realized that the distance hurt overall costs and speed – to the tune of about $2 more per unit. “We didn’t lose money, but, obviously, it hurt our bottom line,” Venezia said.

Hunting for a new location led Spreadshirt to Henderson, Nevada, where facilities that met specifications were available at favorable terms, along with a pool of prospective workers.

“We just got this incredible deal that provided us so many benefits,” Venezia said.

 

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How ‘Made in the USA’ is Making a Comeback

April 11, 2013 by Leave a comment

Rana Foroohar Curious Capitalist

By 

The U.S. economy continues to struggle, and the weak March jobs report — just 88,000 positions were added — briefly spooked the market. But step back and you’ll see a bright spot, perhaps the best economic news the U.S. has witnessed since the rise of Silicon Valley: Made in the USA is making a comeback. Climbing out of the recession, the U.S. has seen its manufacturing growth outpace that of other advanced nations, with some 500,000 jobs created in the past three years. It marks the first time in more than a decade that the number of factory jobs has gone up instead of down. From ExOne’s 3-D manufacturing plant near Pittsburgh to Dow Chemical’s expanding ethylene and propylene production in Louisiana and Texas, which could create 35,000 jobs, American workers are busy making things that customers around the world want to buy — and defying the narrative of the nation’s supposedly inevitable manufacturing decline.Time Magazine Made in the USA

The past several months alone have seen some surprising reversals. Apple, famous for the city-size factories in China that produce its gadgets, decided to assemble one of its Mac computer lines in the U.S. Walmart, which pioneered global sourcing to find the lowest-priced goods for customers, said it would pump up spending with American suppliers by $50 billion over the next decade — and save money by doing so (for TIME’s new cover story, written by myself and Bill Saporito, and available to subscribers, click here). And Airbus will build JetBlue’s new jets in Alabama.

Some economists argue that the gains are a natural part of the business cycle, rather than a sustainable recovery in the sector. But I would argue that the improvements of the last three years aren’t a blip. They are the sum of a powerful equation refiguring the global economy. U.S. factories increasingly have access to cheap energy thanks to oil and gas from the shale boom. For companies outside the U.S., it’s the opposite: high global oil prices translate into costlier fuel for ships and planes — which means some labor savings from low-cost plants in China evaporate when the goods are shipped thousands of miles. And about those low-cost plants: workers from China to India are demanding and getting bigger paychecks, while U.S. companies have won massive concessions from unions over the past decade. Suddenly the math on outsourcing doesn’t look quite as attractive. Paul Ashworth, the North America economist for research firm Capital Economics, is willing to go a step further. “The offshoring boom,” Ashworth wrote in a recent report, “does appear to have largely run its course.”

Today’s U.S. factories aren’t the noisy places where your grandfather knocked in four bolts a minute for eight hours a day. Dungarees and lunch pails are out; computer skills and specialized training are in, since the new made-in-America economics is centered largely on cutting-edge technologies. The trick for U.S. companies is to develop new manufacturing techniques ahead of global competitors and then use them to produce goods more efficiently on superautomated factory floors. These factories of the future have more machines and fewer workers — and those workers must be able to master the machines. Many new manufacturing jobs require at least a two-year tech degree to complement artisan skills such as welding or milling. The bar will only get higher: Some experts believe it won’t be too long before employers will expect a four-year degree — a job qualification that will eventually be required in many other places around the world too.

(MORE: Is U.S. Manufacturing Really Back?)

Understanding this new look is critical if the U.S. wants to nurture manufacturing and grow jobs. There are implications for educators (who must ensure that future workers have the right skills) as well as policy-makers (who may have to set new educational standards). “Manufacturing is coming back, but it’s evolving into a very different type of animal than the one most people recognize today,” says James Manyika, a director at McKinsey Global Institute who specializes in global high tech. “We’re going to see new jobs, but nowhere near the number some people expect, especially in the short term.”

Still, if the U.S. can get this right, though, the payoff will be tremendous. Manufacturing represents a whopping 67% of private-sector R&D spending as well as 30% of the country’s productivity growth. Every $1 of manufacturing activity returns $1.48 to the economy. “The ability to make things is fundamental to the ability to innovate things over the long term,” says Willy Shih, a Harvard Business School professor and co-author of Producing Prosperity: Why America Needs a Manufacturing Renaissance. “When you give up making products, you lose a lot of the added value.” In other words, what you make makes you. For more on the rebound in manufacturing and what it means for jobs and economic growth in the US, check out this week’s TIME magazine cover story, “Made In America.”
Read more: http://business.time.com/2013/04/11/how-made-in-the-usa-is-making-a-comeback/#ixzz2QCREv0EC

Source: http://business.time.com/2013/04/11/how-made-in-the-usa-is-making-a-comeback/

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Intel’s First Factory Customer Touts Made-in-USA Chips

February 20, 2013 by Leave a comment

Wall Street Journal

By Don Clark

A chip company called Achronix on Wednesday is announcing that the first fruits of Intel’s new build-to-order service are emerging from the factory. That’s a milestone for both companies, and a surprising sidelight could play into the story–worries about dependence on non-U.S. manufacturers.

The Silicon Valley startup in 2010 turned to Intel, which opted to break from long-standing practice and use its sophisticated factories and manufacturing processes to serve customers beyond Intel’s own chip-design groups. Achronix became one of two publicly announced users of the new Intel foundry business, as such services are called.

Intel believes it can make smaller and more sophisticated transistors than other foundries. Achronix, which makes a variety of programmable chips that use lots of transistors, says its bet on Intel has paid off as advertised.

The chips, which include models with a whopping six billion transistors, consume half the power of competing chips and cost about half as much, Achronix says. It is shipping sample quantities to customers now and, when extended testing is completed, will be shipping them in volume in the third quarter, says Robert Blake, the company’s president and chief executive officer.

Most foundry factories are in Taiwan or other parts of Asia. Achronix is quick to point out that the entire process of making its chips is handled in the United States.

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January Jobs Report: Unemployment Rate Up to 7.9 Percent, 157,000 Jobs Added in January

February 1, 2013 by Leave a comment

ap_streetcar_construction_ll_130131_wg

Workers lay streetcar track on Loyola Avenue in New Orleans, in this Nov. 8, 2012 photo. (Gerald Herbert/AP Photo)

 

 ABC NEWS

Feb. 1, 2013

The U.S. economy added 157,000 jobs in January, as the unemployment rate ticked up slightly to 7.9 percent from 7.8 percent, according to data from the Labor Department.

“This jobs figure today indicates that the engine of the economy  is revving, but the car isn’t going anywhere,” said Tom di Galoma, managing director with financial services firm, Navigate Advisors LLC.

Employment numbers for November were revised higher to 247,000 from 161,000. For December, they were also revised higher to 196,000 from 155,000.

“The uncertainty will be around what happens with government jobs, because the uncertain impact of the fiscal cliff in December may have led to some layoffs in January,” said Kevin Dunning, global economist at the Economist Intelligence Unit. “Even though it was ultimately resolved on Jan. 1, some federal government workers may have been laid off.”

Still, “it looks like hiring has been quite resilient despite all the fiscal uncertainty, and so our expectation is that employment continued to climb in January,” he said.

“But it may be a bit diminished because we’ve had quite a strong trend for the last six months, and we’ve always expected that the fiscal tightening will weigh on the economy in early 2013. So, our thought will be that there will be slightly slower job growth than we got used to in the second half of 2012.”

According to the Bureau of Labor Statistics’ Unemployment Insurance Weekly Claims Report, for the week ending Jan. 26, the advance figure for seasonally adjusted initial claims was 368,000, an increase of 38,000 from the previous week’s unrevised figure of 330,000. The four-week moving average was 352,000, an increase of 250 from the previous week’s unrevised average of 351,750.

Stephen Bronars, a senior economist with Welch Consulting in Washington D.C. cautions people not to “overreact” to January’s jobs report.

“Careful observers examine the size of the seasonal adjustment. January is a very difficult month for the BLS to forecast,” he said.

Typically, payroll falls by 2.8 million between December and January because of seasonal workers’ leaving jobs after the holidays, he said. But a report released Thursday by payroll provider ADP noted that private-sector employment increased by 192,000 for January 2013, on a seasonally adjusted basis.

This report, which does not include government or public jobs data, noted that goods-producing employment increased by 15,000 jobs in January, primarily fueled by a 15,000 increase in construction jobs. Manufacturing jobs, however, were down by 3,000.

Service jobs, including restaurant workers, health care workers, housekeepers, teachers and retail sales positions, increased by 177,000, with professional/business services adding 40,000 jobs for the month. the ADP report said. Trade/transportation/utilities added 33,000 jobs, and financial services added 12,000 jobs.

Businesses with 49 or fewer employees added 115,000 jobs in January, according to the ADP report. Employment levels among medium-size companies, that is, those with 50 to 499 employees, rose by 79,000, while employment at companies with 500 or more employees fell by 2,000.

Carlos A. Rodriguez, president and chief executive officer of ADP, said in a statement that private sector employers created an average of 183,000 new jobs per month during the past three months, “an encouraging sign of steady improvement in the job market.”

Economist Bronars noted that in January 2012, nonfarm payroll grew by 275,000 after seasonal adjustment (even though unadjusted payroll declined by 2.67 million), the biggest single month gain in the past 30 months.

“Even though jobs are being created, people who gave up searching for work are coming back into the labor force and will be counted as unemployed until they find work,” Bronars said.

ABC News’ Abby Ellin contributed to this report.

To learn more about Made in USA Certification: http://www.USA-C.com

MADE IN USA CERTIFIED LOGO

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Made in America, Again

January 23, 2013 by Leave a comment

Why Manufacturing Will Return to the U.S.

By:Harold L. Sirkin, Michael Zinser, and Douglas Hohner

Made in America

 

For more than a decade, deciding where to build a manufacturing plant to supply the world was simple for many companies. With its seemingly limitless supply of low-cost labor and an enormous, rapidly developing domestic market, an artificially low currency, and significant government incentives to attract foreign investment, China was the clear choice.

Now, however, a combination of economic forces is fast eroding China’s cost advantage as an export platform for the North American market. Meanwhile, the U.S., with an increasingly flexible workforce and a resilient corporate sector, is becoming more attractive as a place to manufacture many goods consumed on this continent. An analysis by The Boston Consulting Group concludes that, by sometime around 2015—for many goods destined for North American consumers—manufacturing in some parts of the U.S. will be just as economical as manufacturing in China. The key reasons for this shift include the following:

  • Wage and benefit increases of 15 to 20 percent per year at the average Chinese factory will slash China’s labor-cost advantage over low-cost states in the U.S., from 55 percent today to 39 percent in 2015, when adjusted for the higher productivity of U.S. workers. Because labor accounts for a small portion of a product’s manufacturing costs, the savings gained from outsourcing to China will drop to single digits for many products.
  • For many goods, when transportation, duties, supply chain risks, industrial real estate, and other costs are fully accounted for, the cost savings of manufacturing in China rather than in some U.S. states will become minimal within the next five years.
  • Automation and other measures to improve productivity in China won’t be enough to preserve the country’s cost advantage. Indeed, they will undercut the primary attraction of outsourcing to China—access to low-cost labor.
  • Given rising income levels in China and the rest of developing Asia, demand for goods in the region will increase rapidly. Multinational companies are likely to devote more of their capacity in China to serving the domestic Chinese as well as the larger Asian market, and to bring some production work for the North American market back to the U.S.
  • Manufacturing of some goods will shift from China to nations with lower labor costs, such as Vietnam, Indonesia, and Mexico. But these nations’ ability to absorb the higher-end manufacturing that would otherwise go to China will be limited by inadequate infrastructure, skilled workers, scale, and domestic supply networks, as well as by political and intellectual-property risks. Low worker productivity, corruption, and the risk to personal safety are added concerns in some countries.

This reallocation of global manufacturing is in its very early phases. It will vary dramatically from industry to industry, depending on labor content, transportation costs, China’s competitive strengths, and the strategic needs of individual companies. But we believe that it will become more pronounced over the next five years, especially as companies face decisions about where to add future capacity. While China will remain an important manufacturing platform for Asia and Europe, the U.S. will become increasingly attractive for the production of many goods sold to consumers in North America.

This report, the first in a series, examines the economic trends that point to a U.S. manufacturing renaissance. It also explores the strategic implications of the shifting cost equation for companies engaged in global sourcing.

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