Did Trump Create the Bump in Reshoring?

2016 tipped reshoring jobs into positive territory. Finally, more manufacturing jobs came back into the US than left.

During all of 2016, candidate Donald Trump harped on the loss of US manufacturing jobs, scolding companies for moving their production out of the country. As those complaints mounted, jobs actually started to return to the US. The trend accelerated through 2016 and into early 2017.

reshoring, Reshoring Initiative, offshoring, manufacturingFor the first time in decades, more manufacturing jobs returned to the US in 2016 then went offshore, according to the annual data report from the Reshoring Initiative . The report shows that the reshoring trend grew by over 10 percent in 2016, adding 77,000 jobs. That ties the 2014 record and exceeds the rate of offshoring by 27,000 jobs. The results bring the total number of manufacturing jobs brought back from offshore to more than 338,000 since the manufacturing employment low of February 2010.

The Trump Factor

Reshoring picked up steam all through 2016 and into the first quarter of 2017, according to the Initiative’s founder, Harry Moser. “In the first quarter of 2016, we announced about 10,000 jobs coming back. Then 12,000, then 23,000, and in the fourth quarter, 32,000,” Moser told Design News . “Continuing into the first quarter of 2017, 44,000 jobs were announced as coming back. The first quarter of 2017 was four times as high as the first quarter of 2016.”

Given the timing of the jobs returning to the US – growing all through the election year – and given the additional surge in early 2017, Moser sees a connection between Trump’s campaign rhetoric demanding that manufacturing jobs return to the US and the jobs that actually began to return. “It’s clear to us that something significant happened in the fourth quarter of last year and it seems to me that would be Trump,” said Moser.

Flipping the Offshoring Trend

The Initiative’s report shows a net gain of 27,000 jobs in 2016. The report compares that to the 2000-2003 period when the US lost about 220,000 manufacturing jobs per year – net – to offshoring. “The tide has turned. The numbers demonstrate that reshoring is an important contributing factor to the country’s rebounding manufacturing sector,” said Moser.

reshoring, Reshoring Initiative, offshoring, manufacturing

While the 2016 reshoring numbers are strong, and while early 2017 figures look even better, Moser insists the pace won’t hold up. “I don’t think it can be sustained. The number of jobs reshored during first quarter comes to 180,000 annualized. Last year it was 88,000,” said Moser. “We’re not competitive enough to bring back that number of jobs, especially with the skills gap and no improvements in infrastructure.”

The Final Flip: US Competitiveness

There are a number inherent challenges that weaken the ability for US manufacturers to compete globally. “We’re in a relatively non-competitive position, since we have a strong dollar and cheap oil,” said Moser. “Plus, we have the historic disadvantage of a low-skilled workforce. We also have high corporate taxes.”

 

 

The Reshoring

Comments

Michael Bandel's picture
There are a number of troubling things being said here. First is that arguably any reshoring in 2016 and Q1 of 2017 has little to do with Trump. People who think a President has that kind of influence on actual economic policy that early in their administration needs to be forced to hand write a copy of the constitution. Second, Harry Moser is talking out of his you-know-what when he says we (the USA) have high corporate taxes. This is a flat-out lie that shouldn't have been quoted.

Thanks for the non-partisan opinion. *giggle* The country was fairly certain early in 2016 that our next President wasn't going to a Socialist/Communist/Marxists/Democrat running on the DNC ticket and by the middle of the year we knew it was going to be the America loving Democrat running on the RNC ticket. I don't think you can give any one person all the credit, but to pretend the last election and Trump had no influence is ignorant, if not just stupid. And, all of our taxes are too high.

"America loving Democrat?" I think you may have meant Republican, but regardless, it makes no sense either way. It was not clear early in 2016 who was going to win. In fact, after reading this article, I could claim that resourcing was the result of the fact that everyone thought Hillary was going to be in the White House. Trump did not win the popular vote, BTW. He squeaked by with the help of the electoral college. This article + your comment = nonsense.

Pres. Trump has definitely put an edge on buying American in his stump speeches and tweets and that he is (imo) about the most vocal advocate we have had on the subject in decades. Good for him. Free trade is a complex issue for folks to understand, but it should be easy to see the error of saying one thing and doing another. Mr. Trump (and family): bring back your own clothing and apparel manufacturing from the Far East sweat shops, then tweet about Ford and Mexico plants all you want

Someone at Design News must have wanted to start a political fight because, regardless of which side of the aisle they, or any of us, are on, we all know the title alone was enough to start one. I can see the humor in it and go all the time to political sites for "fun", but just seems that a technology themed "magazine" ought to avoid it. Hell even the non-politically themed article will get some political junkies claiming all kinds of proofs that their political beliefs are true and scientific!

Yep, can't get away from political junk - even on a technical website. If Design News wants to water down its technical content with political uselessness then I'll get my technical news elsewhere.

Agreed. Doesn't seem relevant to a tech blog. Also, the article cited says nobody actually knows how many jobs were reshored - it is extrapolated from a drop in imports. So a political foodfight on a tech blog around fluffy data...

As Michael Bandel mentioned earlier, where in the heck do people get the idea that corporate taxes are high in the United States. They used to be very high, in the 40s, 50s, and 60s, when, BTW, we experienced the greatest prosperity ever. Trump, Clinton, and even Sanders, have had nothing to do with job resourcing. These things are based on market forces and nothing more. Looks to me like Trump-backers are scraping the bottom of the barrel looking for positive impacts of his election. Give it up

Anything that shapes up economically so far has nothing to do with Trump, but if at all with the previous administration. Trump's policies (are there any?) could not have any effect, it doesn't work that quickly or retroactively. Nevertheless, Trump is quick to take credit for it. The numbers lack an important figure: how many jobs were lost for good? If in the past year 388k jobs were reshored but 500k eliminated we did not gain anything.

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