| Not all manufacturing is less productive. It might not be productive to manufacture t-shirts in the US but it's productive to manufacture airplanes. There's the flying geese paradigm (FGP) that theorizes the rapid industrialization of Asia. It theorizes the movement of manufacturing form country to country as well as a process of industrial upgrading. For example, manufacturing began in London, moved to the US, and eventually someone built a factory in Japan. In all these circumstances in order to stay competitive - they had to move to a country with cheaper labor or manufacture a more advanced product with a bigger profit margin. However their competitors catch up and they need to do the same thing again. Find a better more complex product to manufacture or find a way to manufacture it cheaper overseas. The US started to lose its manufacturing jobs and thus its middle class starting from the 1950s. Most of these jobs were replaced by the service industry for half the pay. Today the service industry employs the most poor Americans today, your cashiers and waiters, and they are soon to be eliminated. I've been researching manufacturing because I want to make some toothbrushes. In China, I could make them for less than 25 cents. I'm not sure how much it would cost in the USA, and a lot of my colleagues tell me that most manufacturers won't even call them back because they're so small. China on the other hand doesn't care - they're happy to sell you 1000 toothbrushes for 25 cents each. I don't know what's better. To manufacture in the USA and not be able to compete on price - one of the biggest factors in a purchase or manufacture them in China and be competitive... Well I guess the answer is simple, if you want to make a business, you need to be profitable. If it's not profitable in the US, then China might be your only answer. |