China’s Outsourcing Appeal Dimming

US manufacturers, who watch budgets and make products for consumers outside China, are less eager to outsource manufacturing operations work. “Soaring energy costs, the falling dollar and inflation are cutting into what U.S. manufacturers call the ‘China price’ – the 40 to 50 percent cost advantage once offered by Chinese producers,” reports Ariana Eunjung Cha for the Washington Post. Cha describes the analysis from the owner of Exxel Outdoors, a Los Angeles-based maker of recreational equipment, who shifted production from China to the US. Rising fuel costs ease trade imbalances and could slow Asia’s double-digit growth. Manufacturers of furniture, electronic appliances, textiles and steel – both in China and the US – quickly adapt to shifting economic circumstances, but also suggest that environmental and patriotic factors come into play. While some manufacturing jobs will return to the US, China can use the downturn to focus on small products less expensive to ship and develop its high-tech and service industries. – YaleGlobal