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Hi-tech manufacturing returns to US

By Ma Yujia: 0 Comment(s)Print E-mail China.org.cn, July 9, 2012

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Hi-tech manufacturing returns to US.[ File photo]

A report released by the Boston Consulting Group (BCG) showed that the wages and welfare of workers in ordinary Chinese factories increased by 15 to 20 percent per year, which poses a threat to the Chinese labor cost advantage.

Prompted by the global financial crisis, some Western policymakers now reckon it is about time their countries returned to making stuff in order to create jobs.

After putting forward the proposal of "Framework for Sustainable and Balanced Growth" in the summit meeting of G20 in 2009, the US government unveiled series of policies to spark economic growth.

In this context, many hi-tech industrial companies have chosen to return America. The latest survey conducted by the BCG showed that more than one third of executives of manufacturing companies planned to transfer their production line from China to the United States.

Some economists thought one of the key reasons for the return of American manufacturers are the higher labor costs in China and the price falls of American workers.

"At present, the wage of workers in China is 2 to 3 dollars per hour, while it is 18 to 20 dollars in America," Dean Baker, director of the Center for Economic and policy research, told China Business News.

The BCG predicts that China's hourly wage will reach 4.41 dollars in 2015, while the US average hourly wage will be 26.06 dollars.

"Although a huge gap still exists between China and America in terms of labor wages, for American manufacturers, there are still lots of advantages in making products in the United States, like the contraction of transport time, the descent of transport costs and the quick access to the markets," Baker added.

BCG predicted the return of American manufacturers to the US will not change China's status as a manufacturing powerhouse.