Hacker News Reader

Comment by Animats | Hacker News Reader

It's about time for the US to get back into manufacturing. Wages in China have gone up enough that the cost advantage isn't as great as it was a decade ago. The average manufacturing wage in Shenzhen is now about US $36,000/year. US average manufacturing wage is $70,446/year. That's a little under 2:1. A decade ago it was about 30:1.

View on HN

Industrial production in the USA is near the highest it has ever been. Production has already returned, it's just that all the jobs are very highly automated now. An economy where the majority of jobs are involved in manufacturing is unlikely to ever return.

If the worldwide system of cheap, reliable container shipping network breaks down it'll probably happen (very slowly), along with a firestorm of inflation (that'll be quick).

Right now it's only fraying around the edges.

It looks like it flat lined for the last decade.

https://fred.stlouisfed.org/series/PRMNTO01USQ661N

That's just an argument for moving the actual production to countries where the ratio is still 30:1. Thailand, Cambodia, Vietnam, etc. Maybe even bits of Africa.

That's trading a temporary advantage for a long-term disadvantage. Eventually labor costs will even out globally, meaning moving manufacturing to countries with a 30:1 ratio isn't a long-term benefit. But "onshored" manufacturing, in the long term, would reduce dependency on potentially unreliable (or adversarial) counterparties.

> Eventually labor costs will even out globally,

Somehow I have a feeling this will never happen.

Wages are not that low in Thailand anymore. Vietnam and especially Cambodia are a lot lower than China.. for now.

> The average manufacturing wage in Shenzhen is now about US $36,000/year

Source? That seems remarkably high in my experience. Also you will need to adjust the two wages for working hours which are much longer in China.

http://www.salaryexplorer.com/salary-survey.php?loc=3023&loc...

I live in China and I have to say this seems way off, by a factor of at least 2.

However, the website does list:

> Factory Worker 8,800 CNY

This is around 15800 USD per year, with all benefits included. This does seem reasonable. So bad average I guess.

Those numbers are way off, no source is given, it's higher than anywhere else I can find, and the same website seems to think that the average in the UK (where I live) is also £71k per year while the UK National Statistics Office says it is £31.7k (so under half).

So those numbers can't be trusted.

Reply on news.ycombinator.com