Tuesday, July 27, 2010

Re-Claiming "American Made"

I haven't been doing too good of a job doing any posting here the last few weeks. It's not that my situation has changed appreciably for the better nor has the economic situation of other un/underemployed folks gotten better. But occasionally life does intrude, even when things are not going all that well.

That being said, there have been a couple of articles from the NY Times recently that I can only hope will penetrate the minds of people in power. (I shant be holding my breath mind you, but I can hope).

First up is this article from back in June on the possibility of rising wages in China possibly causing prices of Chinese made goods to rise.

Coastal factories are increasing hourly payments to workers. Local governments are raising minimum wage standards. And if China allows its currency, the renminbi, to appreciate against the United States dollar later this year, as many economists are predicting, the relative cost of manufacturing in China will almost certainly rise.

The salaries of factory workers in China are still low compared to those in the United States and Europe: the hourly wage in southern China is only about 75 cents an hour. But economists say wage increases here will eventually ripple through the global economy, driving up the prices of goods as diverse as T-shirts, sneakers, computer servers and smartphones.

“For a long time, China has been the anchor of global disinflation,” said Dong Tao, an economist at Credit Suisse, referring to how the two-decade-long shift to manufacturing in China helped many global companies lower costs and prices. “But this may be the beginning of the end of an era.”

Then there is this article from today's (Tuesday, July 27) NY Times on rising shipping costs of goods from China that still don't guarantee the goods actually get on board ships and make it to the US:
Fighting for freight, retailers are outbidding each other to score scarce cargo space on ships, paying two to three times last year’s freight rates — in some cases, the highest rates in five years. And still, many are getting merchandise weeks late.

The problems stem from 2009, when stores slashed inventory. With little demand for shipping, ocean carriers took ships out of service: more than 11 percent of the global shipping fleet was idle in spring 2009, according to AXS-Alphaliner, an industry consultant.

Carriers also moved to “slow steaming,” traveling at slower and more fuel-efficient speeds, while the companies producing containers, the typically 20- or 40-foot boxes in which most consumer companies ship goods, essentially stopped making them.

What good is it for low priced goods if the products can't make it to market on time? Which also makes me wonder if the confluence of events such as these might start the repatriation of jobs back to the US. Of course, to do so will mean a number of changes will have to be made. Among the necessary changes will be setting up ways of training people in the use of tools and equipment from carpentry and woodmaking up through developing tool and dye facilities.

Way back before my youth had been mis-spent, I had a junior high shop class that covered the basics of metal working, woodworking, and drafting. If you didn't play in the band, the boys took shop and the girls took home-ec. Given my talents, I probably would have done better in the home-ec classes but wasn't quite willing to attempt to buck the system at that point. Do junior highs and high schools even offer home-ec or shop classes these days or are those considered luxury courses today since they don't impact the almighty test?

During my early years, the phrase "Made In Japan" was used as a term of derision, mocked by all as signifying cheaply made products generally worth even less than they cost while "Made In America" was a sign of well-made, craftsmanship. Over the years, the Japanese products, often through the application of the principles of Quality Assurance they learned from Dr Deming improved dramatically in quality. Now, Made In Japan has come to signify well-made and American Made is hardly ever heard. Instead we hear about how wonderful it is that businesses off shore technology and jobs to China and other countries so the US can be flooded with cheap products (even though folks without jobs can't even afford the cheapest products.) The businesses that will be best positioned to succeed when the economy actually does return will be those businesses that recognize the value of American Made and structure their work accordingly.

And because I can:

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