US – Are more jobs coming back?

After years of jobs moving overseas by the million, some are trickling back. China’s largest PC manufacturer, Lenovo Group, recently announced that it will open its first manufacturing plant in the U.S. The company expects to create 115 jobs in North Carolina, where it also operates customer service facilities and data centers. And in late September, General Motors (GM) announced that it would reverse years of IT outsourcing and bring most of its data-processing work back in-house, which will result in the auto giant hiring an estimated 10,000 people worldwide.

Politicians may vow to repatriate jobs that have been outsourced to China, India, Brazil and other low-wage havens, but to businesses the question of where to locate jobs isn’t emotional or sentimental. Rather, they are interested in what makes financial sense. And increasingly manufacturing in the U.S. makes sense for a number of reasons.

Manufacturing jobs loss to stop, says studyFoxconn denies worker unrest slows iPhone assemblyWhy Apple’s labor practices may never improve

For some companies, one reason to return stateside is cost. According to a study by The Hackett Group, a management consultancy, manufacturing in China has been losing its cost edge. Labor is still cheaper, but the price of goods is also affected by other factors. For instance, there is the “landed cost,” to consider, which includes every expense to not only make products but also to get them to where they need to be.

Meanwhile, wages are creeping up in China as employers try to avoid the type of worker unrest that has plagued Foxconn, which makes Apple (AAPL) products. At the same time, U.S. wages have come down. Add the surging cost of fuel of shipping goods from Asia and other distant locations, the complexity of global logistics and other considerations, and what was a 35 percent price advantage in 2005 will, according to Hackett, drop to 16 percent next year. That’s the level at which companies question whether outsourcing even makes sense.

Raw costs aren’t the only consideration. Lenovo’s rational for putting a factory in the U.S. isn’t a sudden price break. In fact, the company will assemble hundreds of thousands, not millions, of units in North Carolina. Factories in China, Europe and Mexico aren’t going away…

via More jobs return to the U.S.: Is it a trend? – CBS News.