September 23, 2023

reshoring from china

Proficient Sourcing is interested in helping OEM’s reshore, especially from China.  On 8/4 we wrote an article about Peter Zeihan’s emphatic comments that China was nearing an end as a manufacturing superpower.  Several factors were cited, and now there’s more from this same source.

And speaking of reshoring, here’s some good news from the Reshoring Institute’s 2023 Q1 Data Report:

“Reshoring + FDI [Foreign Direct Investment] manufacturing job announcements are continuing to outpace recent records, adding 101,500 jobs in 2023 Q1. If the current rate continues new job announcements will reach over 400,000 by year-end. Additionally, the cumulative number of jobs brought back since the manufacturing low in 2010 will reach two million – about 40% of what we lost to offshoring.”

However, this report also notes this:

“The lack of focus on manufacturing over the past 40 years got the U.S. so dependent on imports that it needed $100’s billion in government incentives to start the recovery. It is imperative that the manufacturing industrial base maintain a strong recovery to return the U.S. to a safer and more self-sufficient state.”

Obviously, the current UAW strike won’t help US manufacturing (yet), and we have frequently noted policies to encourage trade education, lowering energy cost and general help for small business rather than selecting specifics for government funding would be particularly useful.  Boosting US manufacturing is strongy recommended by Mr. Zeihan, who is an interesting source for all manner of geopolitical information.  Just a few days ago he had a Youtube posting on China which reinforced his earlier comments.  This video is even more emphatic that the end of China as a major manufacturing player is near, for several reasons:

  • both consumer spending and lending are down
  • Youth unemployment is up and their demographics will no longer support needed consumer spending and needed workers.
  • Information on things like patents, bond transfers, and other key economic items is no longer available.  In general, there’s an information vacuum.
  • Leaders in several key areas have disappeared (purged?).
  • The Chinese birthrate has experienced the fastest drop in human history over the past 5-6 years.

While much of this information has come to light within the past few months, Mr. Zeihan says it’s been going on for the past few years.  It’s just that the western world has been occupied with other issues, not the least of which was covid.  So much of the China story passed us all by.

We, of course, have no idea if Mr. Zeihan’s analysis is correct.  There are many people reporting on China.  However, if but some of his conclusions are accurate it is bad news for any of you with Chinese manufacturing suppliers.

And if that’s the case, and you wish to consider domestic replacements, please keep Proficient Sourcing in mind.  We have a large and diverse network of domestic manufacturing suppliers who cover most needs.  These companies have been chosen because they have a good performance track record and a history of happy customers.  Steel castings are just one example.  Our domestic ferrous foundry is ready for your requests.  Just give us a call at (513) 489-5252.

About the author 

Charlie Harte

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