Reshoring Initiative
CRANBERRY TWP — Morris Great Lakes, a distributor of machine tools and related equipment, welcomed a domestic manufacturing advocate to its new headquarters on Marshall Road during a three-day grand opening celebration this past week.
Harry Moser, president of the Reshoring Initiative, spoke Wednesday and Thursday during open house sessions and machine demonstrations for hundreds of Morris customers and industry officials.
Morris Great Lakes also had a public open house Friday at the 12,000-square-foot facility, which was built by W.K. Thomas & Associates of Butler Township.
Moser, who has more than 45 years of experience in manufacturing, founded the Reshoring Initiative in 2010 with the mission of establishing an industry-led effort to bring manufacturing jobs back to the United States after decades of them being moved to other countries.
During the past three years, he has participated in President Barack Obama's 2012 Insourcing Forum, testified at Congressional hearings on reshoring and manufacturing and has been featured in many national publications and broadcasts.
Moser, who is retired after most recently serving as chairman emeritus of Charmilles Technologies, which is now GF AgieCharmilles and a division of Switzerland-based Georg Fischer Group, also is on the board of the National Institute of Metalworking Skills, a leading institute that provides credentials for skilled manufacturing.
Moser's message is simple: Companies must accurately and comprehensively calculate all their costs to see if making products outside the U.S. is really advantageous.
“The purpose of the Reshoring Intiative is to bring manufacturing jobs back to the U.S. so you have more members and they have more business and you sell more machines,” he said.
“The essence of it is to manufacture near the consumer,” he added, explaining that “transplants,” such as Japanese automakers Honda and Toyota, already have crunched the numbers on the benefits of building vehicles for the U.S. market in this country.
In addition to creating more jobs, Moser said reshoring boosts innovation because engineering departments are not separated from overseas production departments. Domestic manufacturing also poses less of a risk of poor product reliability and intellectual property theft.
In the end, manufacturers can produce and sell goods for not much more, the same or even less of a cost by staying in the country, Moser said.
Through the Reshoring Initiative, which is a nonprofit organization in Kildeer Ill., Moser helps manufacturers look at those numbers by supplying research and offering a free software program to help companies calculate their “total cost of ownership” to operate in the U.S. instead of other countries.
The program, TCO Estimator, works by inputting company-specific data into dozens of categories to calculate if reshoring is beneficial.
“We find that about 60 percent of manufacturers went offshore without doing the math properly,” he said.
Some of those reasons included basing decisions solely on chasing the lowest costs for labor, purchase price or transfer price, he said.Moser said as companies bring production back to the U.S., it will have a multiplying effect on the economy and create a better “ecosystem” for manufacturing. In other words, more companies making all kinds of components domestically would lead to more complete products being made completely in the U.S.Some examples of large companies that have reshored include General Electric opening a water heater plant in Kentucky, Bailey Hydropower building hydraulic cylinders in Tennessee and toymaker Wham-O making Frisbees and Hula Hoops in Michigan and California.Moser said even Apple has announced it will bring some of its operations back to the U.S.“We calculate that about 50,000 manufacturing jobs have been reshored,” he said. “I'd like to tell you it's a million, but I only started three years ago.”However, he said those 50,000 jobs are 10 percent of the total manufacturing jobs created during the past three years.Moser's forecast for the next several years is optimistic and potentially significant.If companies used the TCO Estimator, 500,000 jobs could potentially be moved back to the U.S.If wages in China continue to double every four years as they have, companies could shift another 500,000 jobs back to the U.S. If the U.S. improves training initiatives, 1 million new jobs could be created.And if countries like China are forced to stop currency manipulation, another 1 million jobs could return to the U.S.Moser said improving domestic work force training is a large component of potential success.“For reshoring to succeed, it's essential that recruiting happens; that we recruit more and better people into the skilled work force of the future,” he said.“But for recruiting to happen, it's essential society believes reshoring is happening. Because otherwise, why would the student want to go into manufacturing? Why would they want to get the training that would leave them in a position to not have a job later?” he said.As a result, Moser has been working with the U.S. Department of Labor to get the agency to retool the way it conducts research and compiles data regarding education and potential wages. Currently, skilled laborers are essentially unaccounted for in the data, which makes a college education look like the only way to get ahead.“We think there's a nice, tight synergy between reshoring and recruiting, which is necessary for all of us,” he said.
