This is Mary Walden with economist MW, welcoming you to the economic perspective. Today’s program looks at the competitiveness of US manufacturing. Mike, one of the biggest threats faced by US manufacturing has been from foreign competitors. Using the benefit of lower cost labor, foreign factories have often been able to produce lower priced products and therefore out-compete more expensive US companies. Is this still a problem for our domestic factories?
- It’s still an issue, but the good news is, it has improved
- The Boston Consulting Group recently released a study comparing manufacturing costs around the world
- Costs included wages, energy costs, and factored in productivity
- Compared 2004 and 2018
- Looked at US manufacturing costs compared to those in 10 countries.
- Good news – in 6 of the 10 countries, the gap between their costs and US costs narrowed
- Brazil, S Korea, Poland, China, India, Indonesia
- Gap widened for Mexico, and for Germany, UK, and Japan – they are still more expensive, but not by as much in 2018 compared to 2014
- Good results for the US
- I’m MW
And I’m Mary Walden for the Economic Perspective, an NC State Extension program from the Department of Agricultural and Resource Economics