The Momentum Is With American Manufacturing Again

Corbis For the last three years, manufacturing activity has been growing more rapidly than the gross domestic product. This is the first time this has happened in more than 50 years. I believe the factors that have led to this oddity are sustainable and that manufacturing and overall industrial growth will probably continue to outpace overall GDP growth rates in the United States for some time. Many manufacturing costs are becoming more level. Since the 1970s, many foreign countries have been leveraging their low cost-of-labor advantage to gain market share of the global manufacturing pie. It now appears that, in many cases, this cost advantage is becoming less acute. Most manufacturing organizations can break their major cost structures down into the following broad categories: Raw materials, including energy. Cost of capital, including interest. Labor. Transportation. Inventory costs. Research and development. Selling, general and administrative expenses. Taxes and regulations. Positive Long-Term Developments