According to a Congressional Research Service report, the current U.S. share of global manufacturing is at approximately 17%. However, many experts are predicting that the recent surge in U. S. manufacturing will continue. A combination of rising wages in China and other countries, and a two third reduction in the price of natural gas since 2008 has made U.S. manufacturing more attractive to businesses. Many businesses that formerly outsourced their manufacturing processes to other countries are returning to the U.S. as a result of these developments. How will this affect American businesses?

Growth in Industries = Growth in Jobs

Other contributing factors to the surge include growth in the energy, technology, and additives manufacturing sectors of the economy. However, according to one article, 72% of all manufacturing jobs created since 2010 have been in the automotive sector. According to a new report from the Information Technology & Innovation Foundation, the U.S. has added 520,000 jobs in manufacturing in the last three years.

Technology helping to Power the Surge

The report agrees with predictions by experts at the Boston Consulting Group. Utilizing data from current trends, future projections include a substantial increase in the use of technology and automation within the manufacturing industry. South Korea and China are setting the pace, with South Korea predicted to decrease labor costs by 33% by 2025. With the average U.S. factory wage at $27 an hour, robotics offer the potential for substantial savings.

A survey of business owners with sales of $1 billion or more revealed that 72% plan to invest in automation technology within the next five years. Robotics will have a profound effect on U.S. manufacturing in the next decade. While robotics currently account for only 10% of global manufacturing tasks, that number is predicted to reach 25% by 2025.

Where is it all Headed?

What all this means for American businesses is a decrease in both labor and production costs. Wireless data analytics technology has also given manufacturers more control over production, thereby reducing waste. Cost savings in the manufacture of products can be passed on to businesses, and ultimately, consumers. Some of those savings can also be invested in research and development of new products.

An increase in automation will also affect the way businesses hire workers. The manufacturing work force of the future will consist of fewer laborers and more electrical engineers and quality control managers. This will result in businesses investing more in worker education and training to best utilize the newest technologies that allow them to become more streamlined and efficient.

While many experts have made predictions, only time will tell where the manufacturing industry is headed. Small businesses and large corporations will both experience the influence of changes in the manufacturing industry—both positively and negatively. However, for the most part, the resurgence of manufacturing on United States soil is proving to be a positive change. The information for this article was provided by the professionals of Advantage Manufacturing Ltd., who specialize in welding in Edmonton.