Almost immediately after my blog on A.T. Kearney’s latest reshoring study hit the in boxes of PlasticsToday readers, I heard from Harry Moser—manufacturing’s champion of reshoring—with a rebuttal of the Kearney study. I actually had a premonition that I’d hear from Harry. He keeps a sharp eye out for any reshoring article that appears in the media, ready for bear.
Conflicting information seems to abound in the reshoring arena, and there are a number of reasons for that. Surveys contain many variables depending on who developed the survey, the way the questions are posed and the intention of the survey. Obviously the goal is to make the surveys as objective as possible, but numbers are funny things. As part of my journalism curriculum at Arizona State’s Walter Cronkite School of Journalism, I had to take a statistics class. I was told there wouldn’t be much math in the class (thank goodness!) and that most of the journalism students opted for this political statistics class because it was more about trends and gaining an understanding of what statistics are telling us. I remember on the first day of class the teacher telling us that the first rule of statistics when evaluating surveys is that the surveyors can make the numbers say anything they want them to say. I’ve never forgotten that and try to keep it in mind, especially when I’m looking at all of the various surveys on reshoring.
The A.T. Kearney study appeared to offer further proof that U.S. manufacturing is still waiting for the reshoring phenomenon to happen. “Companies that study this sort of thing have been saying the same thing for several years—it’s anecdotal; it’s coming in dribs and drabs; it’s a job here and a job there. But there have been no tsunamis—nor should we expect there to be,” I wrote.
It’s rather like the blog I wrote exactly a year ago on Kearney’s 2014 reshoring study. And, again, Moser is challenging the Kearney study: While A.T. Kearney “got some things right,” Moser wrote to me in an email, other things in the study were “clearly wrong.”
Moser offered some information on the Foreign Direct Investment (FDI) and reshoring, which are, noted Moser, “essentially the same phenomenon, just parent company headquarters in different countries. In both cases, the company decides it is more profitable to serve the U.S. market from a U.S.-based factory instead of from a foreign factory.” What A.T. Kearney got right, according to Moser, is that FDI is strong. “In fact, in 2015 it is stronger than reshoring,” he said.
What Kearney got wrong, claimed Moser in his rebuttal, is the number of reshoring cases per year, which Kearney’s data showed as being off by 70% from 2013 to 2015 projected. “Our database shows a smaller (40%) reduction, but reshoring still remains at about twice the 2011 level,” said Moser.
Another point that the Kearney study “got wrong,” according to Moser, is the suggestion that jobs leaving China are preferentially going to Mexico, rather than the United States. “Certainly, some jobs are. However, a recent
