Taps Coogan – December 20th, 2021

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In another sign that we’ve been transported to an alternate reality, manufacturing job openings in the US have exceeded one million for the first time since at least 2001. They are just a hair less than double the prior 2018 peak of 523,000 openings, with no sign that they’ve peaked.

What is causing this? First and foremost, an explosion in demand for manufactured goods spurred by absurd amounts of stimulus, an inability to easily import products due to shipping delays, perhaps some lagging effects from changes to NAFTA/USMCA and other US trade deals as well as the prior administration’s deregulatory efforts and tax cuts, incentives and giveaways in the various Covid stimulus bills for domestic manufacturing, etc…

All of that has companies rethinking supply chains created decades ago to exploit cheap labor in manufacturing industries that are no longer particularly labor intensive. Survey’s of manufacturing executives are showing unprecedented level of interest in diversifying suppliers, shortening supply chains, as well as ‘non-economic’ considerations (read national security and IP theft in China), with over half reporting “significant changes across their supply chains” and nearly half of those reshoring or ‘near-shoring’ (Mexico) production.

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