Manufacturing Returns to the US

Made in USA Logo
Made in USA Logo

With the political campaign season drawing to a close, candidates all around are talking about job creation. One of the areas traditionally equated with a strong economy and positive job growth has been the manufacturing field. After years of companies outsourcing jobs, certain things seem to be coming back. Companies like Hyundai, BMW, Honda, and Toyota have brought assembly plants into the United States. They’ve decided that it’s more cost effective to send a cargo ship full of parts over and have the cars built here than to send a cargo ship of assembled vehicles over. The latest big company to make such an announcement is the PC manufacturer Lenovo.

Lenovo Manufacturing in the United States

As this article from Reuters mentions, the PC manufacturer Lenovo is going to build a plant in North Carolina, providing 115 manufacturing jobs to the area. One aspect of this announcement that I find particularly interesting is the idea that Lenovo will be manufacturing tablets here in the US. When you look at how ubiquitous the tablet form factor has become, it’s sad to think that all of those slender life-altering computers are being manufactured overseas and sent here for us to consume. Foxconn, the company responsible for manufacturing Apple products employs over one million people. What would adding one million technical manufacturing jobs do for the US economy?

The Role of Manufacturing in the Economy

I may not have paid a lot of attention in my US history or economics classes, but what I do remember is this. The massive job growth in manufacturing necessary to produce weapons and supplies for World War II built up a sizable, strong, and sustainable middle class. By paying workers to produce goods, the workers had disposable income. Once the war was over, manufacturing facilities shifted production from war goods to consumer goods. Employees had money to buy the consumer goods with. Consumer spending increased. Business profits grew, and the financial turmoil of the 1930s was replaced with the prosperity and consumerism of the 1950s and 1960s. Give people reliable jobs with steady paychecks producing something, and they’ll spend those paychecks and grow the economy. We can’t borrow our way out. We can’t regulate our way out. We have to buy our way out, and until someone goes out on a limb, things will remain stagnant.

The Future of Manufacturing

With any luck, the Lenovo announcement will be just the beginning. If Lenovo is successful in bringing manufacturing to the United States and maintaining quality and profits, it signals to other companies that high-tech goods can be built here. Maybe a few years down the line, we’ll see Foxconn producing the iPhone 7 and iPad 5 here in the US, and the Apple products can once again proudly wear the “Made in America” logo.