When I was growing up I remember the brand “Made in USA” was everywhere. A lot of consumer and manufacturing goods were made in North America. Somewhere along the way it has become “Made in China”. When I talk to friends here in Redwood City, California, they tell me that there were a lot of manufacturing shops in the area, most are gone now. There seems to be a trend now that some of the jobs that were outsourced to China are coming back. Sure not all of the jobs will ever come back, but many jobs can come back and some corporations are realizing that it is good for their companies and their country to manufacture here. China currently has Issues like high pollution, counterfeiting, corruption, and increasing labor costs that are working against them and are losing jobs.
-Part of the employment gain of the last couple of years here in the U.S. is attributed to some of these manufacturing jobs returning to the homeland. These companies are big and small and every job that returns to the homeland adds up. Manufacturing and specially the energy sector- which is currently booming- are creating many jobs, anywhere from the oil boom of North Dakota, to wind mill farms to solar. Eventually, the renewable energy sector will be huge it’s just a matter of time.
-Decrease in energy costs is another reason to move back to mainland USA. In my post “Fuel your promos” of October 13th, I mentioned oil prices had decreased by 15%, today we are at 26% and counting. Many factors are contributing to this and the trend is downward because of more production here in the U.S. of multiple energy sources and the deceleration of China. The US is now the largest producer of oil in the world and it is great for the economy. This reduction in energy costs is truly going to see a resurgence of consumer spending, especially with the coming holiday season. In addition, strategically with more local production, the U.S. has less dependency from OPEC and for the U.S. and the E.U. it is an advantage to keep certain dictators at bay like Putin in Rusia and Maduro in Venezuela that had too much power and dollars and did as they pleased. They are very low key now. ISIL also makes a million dollars in revenue a day from oil, so the lower the price means less money to cause harm.
-The environment plays an important part in all of this. The key to creating wealth through natural resources in today’s world is in a balanced approach- protecting the environment and benefiting local communities. Local communities have to benefit directly with royalties from these extractions and at the same time investors have to generate interesting profits to encourage the investments. It is a delicate balance but it is working in many places around the world. The days that corporations did as they pleased, ignoring the local communities and the environment, are gone. Local communities are not going to allow it anymore and are ready to put up a fight. There is a new breed of citizens in the world, some are called the new environmentalists along with certain non-profits that are doing a good job. The problem arises when the issues are politicized. As long as the local communities get their share, the environment is respected, and the corporations get a reasonable profit, it is a good formula for job creation.
-Corporations and banks have a huge responsibility in all of this. It is a new world as I have mentioned and the general public is much more proactive now defending its rights and the environment. Social media is a great contributor for information flow and everyone is more aware of suspected malpractice. We do not want to see another crisis like the last one of 2008. The Federal Reserve issued a warning to large banks last week regarding risk management, because the danger is very much present. Corporations have responsibilities to the general public and the environment for doing fair business and should transfer some of the big profits that they currently have into job creation here in the USA. Growth is slow now that is why the poll numbers show discontent in the general public. People need jobs.
Balance in everything we do