What Gives American Factories Their Competitive Edge: They're Easy to CloseYesterday’s pleasant surprise: The U.S. economy grew much faster than we thought in the previous quarter: 2.5 percent on the year, thanks to robust exports.
Another pleasant surprise: That might continue. America’s great manufacturing renaissance continues to attract converts. Companies including Toyota, Honda, Siemens and Rolls Royce have all shifted production to the U.S. in recent years. Boston Consulting Group, which advises companies on their supply chains, recently made an extended case that the United States is like the China of wealthy countries (awesome analogy!) because of how cheap it is to make stuff there.
Here’s BCG’s chart. What it shows is that labor and energy costs are a lot lower in the U.S. than in Europe and Japan, and are no higher, combined, than in China. Overall, in 2015, manufacturing in the U.S. will cost only about 5 percent more than in China.
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