Since its inception in 1992, Unionwear has been committed to preserving the art of American craftsmanship by manufacturing high-quality and durable baseball caps and sewn bags. Known for its unwavering dedication to authenticity and reliability, Unionwear is the trusted choice for businesses, athletes, and the promotional products industry. In today’s competitive global landscape, Unionwear stands out by leveraging innovative processes and advanced technology to create premium products while embracing the unique value of products made in the USA. Needle’s Eye has written a great piece on Unionwear, summarized here:
The Journey of Unionwear:
Unionwear faced challenges when the fashion industry moved production offshore. Initially, the company focused on producing caps and hats for popular fashion brands like Polo Ralph Lauren, Izod, Gant, Barneys, and several skateboard and hip-hop lines. As the fashion industry shifted production towards countries with lower labor costs, Unionwear adapted by targeting B2B clients who value the “Made in USA” label and offering custom products with a competitive edge.
Automation and Lean Processes:
Unionwear recognized the need to evolve in order to survive in the challenging and competitive market. The company invested in automation, advanced technology, and lean manufacturing to streamline production processes while maintaining high-quality standards. Automation has allowed Unionwear to reduce overhead costs, enabling the company to manufacture locally at competitive prices.
For example, Unionwear now utilizes Pathfinder’s M5-180 multi-ply cutting system in its production processes. This has resulted in a 30% increase in fabric utilization compared to traditional die-cutting methods. With only two people manning the Pathfinder system, Unionwear now produces 3,000 hats and 2,000 bags per day, whereas seven people were needed for the same output previously.
Embracing Lean Manufacturing:
Lean manufacturing is another key component of Unionwear’s strategy for success. Amid significant global competition, the company has adopted lean manufacturing principles to eliminate waste, reduce lead times, and ensure maximum efficiency. This approach focuses on creating value for clients by streamlining processes, reducing inefficiencies, and optimizing resources. This has enabled Unionwear to expand its product offerings, respond quickly to market demands, and ensure consistent, high-quality products.
Continuous Improvement and Growth:
Unionwear’s commitment to continuous improvement has led to the company’s growth and expansion over the years. In 2017, Unionwear successfully restructured its operations, raising funds to add new product lines, expand web offerings, and automate labor-intensive processes. The company has also ventured into new niches like medical packaging, travel gear, safety products, and workwear to cater to emerging market demands.
The Future of Unionwear:
With a strong foundation in automation and lean manufacturing principles, Unionwear is taking confident strides towards a promising future. As the era of cheap imports comes to an end, the company is well-positioned to continue its upward trajectory and further establish itself as a leader in American manufacturing.
The success of Unionwear is a testament to the power of innovation, dedication, and the unwavering commitment to domestic manufacturing. By investing in advanced technology, streamlining processes, and prioritizing customer satisfaction, Unionwear has managed to survive and thrive in an ever-evolving market.
Conclusion:
Unionwear is a shining example of how American businesses can revolutionize their operations and remain competitive in the global market through automation and lean processes. The company’s unwavering commitment to quality, innovation, and American craftsmanship has set them apart from others and ensured lasting success. As a customer of Unionwear, you can trust that you’re supporting a truly American brand that values its communities, workers, and the future of the American dream. Together, we can continue to uplift and support domestic manufacturing and promoting genuine, high-quality products made in the USA.
Joe Biden has made a point of highlighting products made in the USA. One such example is Unionwear, a brand passionate about delivering high-quality and durable baseball caps and sewn bags, with a focus on supporting the American workforce and local communities. The President has clearly taken notice, as he’s been spotted proudly sporting various Unionwear hats on multiple occasions.
It’s no surprise to see our Commander-in-Chief favoring Unionwear hats, showcasing some of the finest work that American craftsmanship has to offer. Biden has been spotted in four different Unionwear models within the past year, including the UAW hat, the Beau Biden Foundation hat, and two distinct commander-in-chief hats. Unionwear is truly honored to have the leader of the free world modeling their American-made products.
This spotlight on Unionwear proves that when it comes to quality, durability, and versatility, choosing homegrown products can make all the difference. Despite facing challenges and an ever-evolving market, Unionwear’s unwavering commitment to excellence sets them apart from the competition. Their dedication to supporting the American dream, both for their workers and consumers, has caught the attention of none other than President Biden himself.
Embrace the Unionwear difference today and join the prestigious ranks of those who wear these authentic, straightforward, and resourceful American-made products. If it’s good enough for the President, it’s good enough for all who believe in the industrious and patriotic spirit of America.
Now that the Republican Primary Season is over, it’s time to make a case that losing candidates were disadvantaged by poor merchandise. Looking at reviews of the Republican primary candidates’ merchandise, it’s evident that the mistakes they made were fatal to their campaigns.
Retail politics has evolved significantly in recent years thanks to the rise of technology. Candidates now use customized merchandise to elicit small-dollar donations, engage with supporters, and trial how they market themselves and gauge public response. Campaign store offerings have become tailored and designed to appeal to popular conversations on social media platforms like Instagram, Twitter, and TikTok.
Merchandise not only generates income and garners support but also provides valuable information to candidates about what resonates with voters and helps them adjust their messaging accordingly. However, a problem has emerged with the creation process. The WinRed platform, which is used by most Republican candidates, offers free storefronts for them. While this is helpful in providing easy access to design, source, produce, and distribute merchandise, it does have one significant drawback: all of the stores powered by WinRed look almost identical.
The result is a lack of distinction between candidates, which may go unnoticed by those who have already decided on their preferred candidate. However, for undecided voters shopping around for a candidate, this similarity could create confusion and impede their decision-making process.
It appears that losing candidates might have missed the opportunity to capitalize on the power of merchandise in their campaigns [1] [2]. The ineffective use of the WinRed platform and their failure to stand out from the crowd in their online merch stores seems to have been detrimental. Whether they underestimated the importance of tailored and visually appealing merchandise or simply made poor strategic decisions, it is evident that candidates must pay more attention to their merch game if they want to succeed in the ever-evolving political landscape.
According to The National Law Review, the FTC announced an enforcement action against the manufacturer of Pyrex-brand products for allegedly marketing certain glass measuring cups as “Made in USA” and “American as Apple Pie” while importing those products from China.
In its complaint, the FTC alleges that Instant Brands, the manufacturer of Pyrex products, moved production of Pyrex measuring cups from the U.S. to China between May 2021 and March 2022. The FTC claims the company continued to market the imported products online as domestically made.
As part of the consent order, the company will be required to pay a $129,416 judgment and agree to several restrictions on its ability to claim that its products are made or assembled in the United States.
Furthermore, the order prevents Instant Brands from making unqualified U.S.-origin claims for its products unless it can show that the final assembly or processing occurred in the United States using all or virtually all U.S.-sourced components.
The order also requires Instant Brands to clearly disclose the extent to which a product contains foreign parts, ingredients, or processing to make a “Made in USA” claim.
The FTC has been cracking down on companies who claim to be made in USA but in fact are not. Unionwear welcomes these enforcement actions to make made in USA both realistic and honest.
Fortune features a story on a distinguished professor who has studied supply chains for the last 2 decades. This professor believes that the supply chain has been forever changed due to the pandemic.
He asserts that the global supply chains that modern companies depend on were turned upside down after COVID-19 emerged in China, resulting in shortages of nearly everything. Three years later, retailers continue to struggle to keep some products in stock, and overall stress in supply chains remains high. Many companies that didn’t go bust during the pandemic have been rethinking their supply chains and implementing changes to make them more resilient.
The professor lists some ways companies can, and should, adjust due to changes which are likely permanent.
1. Bringing supply chains home
Supply chains that span the globe are more vulnerable to problems outside of a company’s control, such as an earthquake or a citywide lockdown.
That’s why companies have been relocating suppliers and production facilities closer to home to ensure they can withstand disruptions and maintain business continuity. A recent survey found that U.S. transport and manufacturing reshored about 350,000 jobs in 2022. This trend not only has support from government subsidies but retailers as well. Walmart, one of the world’s biggest retailers, has committed to help its suppliers reshore by increasing its purchases of U.S.-made products by $350 billion over the next decade.
Since the pandemic, companies have since learned that being able to see what is happening along their supply chains is critical to adapting to disruptions. Companies have been investing a lot of tech, including state-of-the-art software to better communicate with suppliers to cloud computing for efficient data storage, AI tools to make better decisions and robotics for automating processes. This will likely continue in future.
There’s more at the article. It’s very well written and sourced. Have a look.
Thomas / Xometry explains what they believe will be the top trends in the supply chain for 2023.
1. There will be an increase in reshoring and near-sourcing
High freight costs, labor shortages, and factory shutdowns, transportation delays, and geopolitical conflicts, have compelled many organizations to rethink their approach to supply chain management. Reshoring manufacturing back to the USA is the best option in our opinion. But nearshoring might also be beneficial and practical for the supply chain. In fact, Fortune says 2023 could be “a nearshoring jackpot for the Americas.”
2. Product-as-a-Service
Product-as-a-service (PaaS) sees vendors combine physical products and services to better fulfill customer needs. For example, equipment manufacturers may lease specialized machinery with a subscription.
3. Crowdsourced Delivery
Last-mile delivery is proving particularly challenging, thanks to high warehousing costs, inefficient routes, lack of visibility, and transportation delays. Retailers began experimenting with crowdsourced delivery, where they leverage networks of local couriers. This approach could revolutionize same-day shipping. Think of it like Uber for packages.
4. Better Worker Conditions for Truckers
The U.S. was short almost 78,000 truck drivers in 2022. The shortfall can be attributed to including increased demand, a retiring workforce, and fewer younger drivers entering the industry. It also could be due to bad pay, a trend which seems to be shifing. In 2023, companies will likely implement referral bonuses and tenure pay to better retain their drivers. As well, it says in 2023, safety will be incentivized over productivity,
5. High Supply Chain Costs
Between January and June, for example, the price of regular motor gasoline rose by 49% in 2022 and the price of diesel fuel rose by 55%. Meanwhile, the ongoing war in Ukraine has seen a decline in food supplies and transportation bottlenecks.
Retailers might look to transform existing retail spaces into fulfillment centers, a tactic taken by Walmart, which is in the process of converting many of its 4,700 stores to mini-warehouses.
Another key trend in warehousing is that the vast majority of spaces are at capacity, with industrial warehouse vacancies sitting at around 1% (as of September 2021). Demand has gotten so high that some tenants are opting to lease space before it is actually required. It’s projected that another 400 million square feet will be needed by the end of 2025 to meet demand at current growth rates. So, turning workplaces into warehouses might happen sooner rather than later.
7. Major Skills Gaps Remain
A shortage of laborers, including truckers, is driving up wages and, ultimately, consumer prices. It’s also impacting recruitment. In fact, one in five people were likely to switch jobs in the next 12 months, and it’s projected that there will be more than two million manufacturing roles left vacant by 2030. As such, firms will need to do much more to upskill and retain their workforce.
8. Technology Investments
61% of supply chain leaders said technology is a source of competitive advantage. Meanwhile, 34% of supply chain leaders noted that adapting to innovative technology will be the most critical strategic change in the future. The top supply chain technology trends of 2022 included digital twins, autonomous things, sustainability tools, and analytics everywhere.
The Reshoring Initiative reported that third quarter 2022 reshoring and foreign direct investments (FDI) reached record levels, registering 15% higher than the second quarter with a strong fourth quarter looking to result in a total of more than 350,000 jobs reshored for all of 2022.
Reshoring says that 2022 projection of jobs would mark a nearly 40% improvement over 2021’s total of 255,000. Since 2010, the total jobs announced would top 1.6 million.
New investments in U.S. manufacturing by domestic and foreign companies briefly slowed their historic pace in the second quarter as inflation soared, but following the passage of the Inflation Reduction Act and Chips and Science Act, investment once again resumed.
For the third year in a row, reshoring outpaced foreign direct investment (FDI), which the initiative believes reflects the peaking of globalization and U.S. incentives to bring manufacturing back. “It also indicates that U.S. headquartered companies are understanding the benefits to localized production that many foreign companies have understood for decades,” the Reshoring Initiative states.
A poll release from Xometry/Zogby reports that 55% of American CEOs whose companies depend on manufacturing to produce and deliver their goods have plans to reshore their operations, and 95% of them said they would do so this year.
The vast reshoring effort is also fueling a new modernization wave, with CEOs investing in robotics, automation, and digital workflow tools as they ramp domestic production.
The survey reveals executives believe supply chain concerns will persist well into the foreseeable future. 89% don’t expect supply chain disruptions to abate any time soon, and 64% agree that there is enough manufacturing capacity in America to address the world’s supply chain concerns.
“Major legislation like the CHIPS and Science Act, the Inflation Reduction Act and the Infrastructure law helped buoy reshoring in 2022, and we expect that trend to accelerate in 2023 as companies further build supply chain resilience,” said Randy Altschuler, CEO of Xometry. “CEOs recognize that tapping into America’s vast manufacturing infrastructure can help solve most of the world’s supply chain problems. As they bring production back to the States, CEOs are also modernizing shops across the country, deploying digital workflow technologies, investing in new processes, and embracing automation.”
Automation, robotics and digital workflow tools are among the modernization efforts
“The resilience of American manufacturing and enterprise in general is astounding,” said Jeremy Zogby, Managing Partner of Zogby Strategies. “CEOs are optimistic and embracing innovation, which are the most-important factors that will drive resilience and manufacturing in 2023.”
Supply Chain Brain has another great article on the benefits of nearshoring. While we at Unionwear prioritize reshoring manufacturing back to the USA, sometimes nearshoring, or friendshoring, is a good option as well.
This is because bringing manufacturing closer to home is a more attractive alternative to the offshoring business operation model. Although offshoring provides numerous benefits, numerous supply chain crises have put both suppliers and retailers at a disadvantage.
Thus, most businesses are considering nearshoring to optimize operations and supply chains. This reshoring and/or nearshoring ensures faster speed to market and quicker transit from manufacturers to customers. On top of that, suppliers and retailers also enjoy the ease of operating in a more convenient time zone.
“Everybody that had extended, long supply chains got clobbered during the pandemic, and one of the solutions is moving your location closer to your market,” former Redwood Mexico president, Troy Ryley, said recently. “The advantage of shorter lead times increases cash-to-cash cycles and provides an edge that many shipping customers cannot match.”
However, while both nearshoring and reshoring are sometimes used interchangeably today, they are not the same.
Nearshoring includes partnering with suppliers, manufacturers and other necessary entities within a supply chain that is located in countries near the company. For instance, a U.S. company might practice nearshoring by working with a supplier in Mexico instead of China.
Reshoring, on the other hand, is the act of bringing manufacturing and production services back to the country or region in which the company operates. For example, a company centered in North Carolina might practice reshoring by working with manufacturers in Georgia.
As global supply chains continue to face several cross-border trade challenges — particularly when importing items from Asia — many companies are adopting nearshoring, investing millions of dollars to situate plants near their target markets. For instance, many manufacturers with a main customer base residing in the United States and Canada are now establishing factories in Mexico.
According to Manufacturing.net, a new Xometry poll, produced in concert with Forbes and Zogby, “reveals nearly two-thirds (64%) of the CEOs say they are currently reshoring or nearshoring their operations or planning to.”
This momentum from manufacturing leadership dovetails with consumer commitments to support made-in-the-USA products.
In late 2020, The Reshoring Institute – a non-profit dedicated to bringing manufacturing back to the United States – revealed the results of its latest “Made in USA” survey and sentiment appears to have shifted a bit. In this most recent report, 69% surveyed said they prefer made-in-the-USA products and three-quarters are willing to pay 10 or 20% more for them.
The American labor shortage has created challenges for companies looking to bring back production to U.S. shores.
Furthermore, as the Reshoring Initiative points out in its most recent newsletter, the march out of China is a long one. They cite Bloomberg Intelligence experts who claim it would take eight years to get just 10% of Apple’s production out of China.
That said, the Reshoring Initiative characterizes the following impactful variables that could influence more companies to bring production the United States:
The CHIPS Act, kicking off a new era of industrial policy.
High natural gas prices in Europe.
A strong manufacturing economy, setting the state for “a manufacturing resurgence in the United States,” according to McKinsey.
Add to that the challenges facing one specific locale that’s been recipient to a large volume of manufacturing goods once produced in America: China.
The country’s “Zero COVID policy” continues to wreak havoc on production rates in key regions, as well as increasing costs for manufacturing amid a backdrop of rising debt and a housing crisis. Additionally, “Economic and political instability will lead foreign companies to decide that China is no longer such an attractive market and will shift elsewhere, including to the U.S., Canada and Mexico.”
There seems to be a concurrent rise in American consumers’ willingness to support the objectives with their wallets.
According to The Hustle, Taiwanese chip maker Taiwan Semiconductor Manufacturing Company is upping its US investment in Arizona from one $12B plant to $40B across two plants.
“This is an incredibly significant moment,” said Apple CEO Tim Cook yesterday as he joined President Biden in announcing a critical win for US manufacturing.
In short, the world has put all of its eggs in one basket. TSMC is responsible for 92% of global advanced semiconductor production, and its chips are critical components in iPhones, military equipment, cars — you name it. If China were to ever invade Taiwan, we’d see global disruption unlike anything we’ve seen before.
The Trump administration first pushed TSMC to break ground on a $12B fab in Arizona. This year, the Biden administration doubled down on these efforts with the $53B incentive-filled CHIPS and Science Act, and now this.
We may soon be able to look at the back of an Apple product and read, “Designed in California. Made in the USA. At least Partially.”
This is happening for many reasons. Supply chain issues surrounding the pandemic is one.
Russia’s invasion of Ukraine and Chinese President Xi Jinping telling the Communist Party Congress that he is prepared to invade Taiwan is another. Meanwhile, U.S. multinational corporations realize how vulnerable they are because of China’s willingness to weaponize and politicize supply chains.
The author thinks it’s time for the United States to begin accelerating reshoring, rebuild American industries and put reindustrialization into overdrive.
Shortages of critical components have led many politicians and corporations to take a hard look at America’s vulnerabilities. They have to face the fact that the U.S. is now at the mercy of rogue nations like China. The Coalition for a Prosperous America’sDomestic Market Share Index (DMSI) also shows that domestic producers’ share of their home market fell to a record low of 63.8 % in Q2 of 2022. If the U.S. is to be less vulnerable to shortages, trade disruptions, natural disasters, war and blackmail, we must develop a strategy to accelerate reshoring production and jobs.
Furthermore, globalization and the decades-long multinational corporation rush towards finding the lowest price anywhere may be weakening.Larry Fink, of Black Rock Financial, said in his 2022 letter to shareholders that “supply chain disruption caused by the pandemic and Russian invasions of Ukraine has put an end to globalization we have experienced over the last three decades.”
Here’s another issue we are seeing. Besides losing our technology and inventions to our competitors, we have lost the skilled workers, the know-how, the suppliers and the capital investment that come with investing into production at scale. Reshoring the industrial commons is going to take an investment in basic industries that are ubiquitous to manufacturing processes.
One trend we can foresee at Unionwear is, when companies reshore to the US, they will find we have a major skills gap. We aren’t the only ones either.
According to this article from Casting Source, unpredictable global disturbances spotlighted the need to reshore essential product ecosystems. But this won’t be easy, as firms need to overcome the manufacturing workforce skills-gap. Indeed, forty-five percent of manufacturing executives surveyed have already turned down business opportunities due to lack of workers.
How? U.S. manufacturers need to engage a wider, more diverse labor pool by increasing diversity, equity, and inclusion (DEI); add flexibility models to attract and retain talent; overcome misperceptions of manufacturing careers; re-skill and up-skill existing workers; and adopt public-private partnerships to provide training that aligns with the needs of business and industry. They also need to embrace lifelong learning for employees to keep them engaged.
You can only reshore to the US if there are enough people to do the work. Not only that, but people need to stay on the job once they get there. There is a lot more detail at the article. Have a look here.
American Machinist has an article which we at Unionwear agree with for reshoring to stick, manufacturers need to modernize.
For decades, U.S. manufacturers reaped considerable production-cost savings by moving their operations offshore, primarily due to the low cost of foreign labor. And although the reshoring trend began around 2010, the past few years have seen a sharp increase in reshoring manufacturing, due in part to rising labor costs worldwide. Obviously, the Covid-19 pandemic had a lot to do with accelerating the trend as well.
Another notable factor motivating U.S. manufacturers to reshore is a wholesale shift in perspective, from price-per-part cost modeling to a total-cost-of-ownership mindset. This includes direct costs, such as record-high shipping rates, managing offshore vendors, and overstocking to buffer against future supply shocks. Then there are indirect costs, including loss of control of intellectual property, risks to reputation, and changing ESG standards.
Two of the top trending factors currently influencing manufacturers’ decisions to reshore are noteworthy: social and ethical concerns due to human rights abuses in China, and Walmart’s $350-billion commitment to sourcing U.S.-made products.
Other factors trending up include manufacturers inventory shortfalls due to supply-chain disruptions, rising freight costs, and the ability to mitigate high U.S. labor costs with automation.
Whatever the motivation, reshoring has outpaced foreign direct investment (FDI) in job creation for three consecutive years, creating a wealth of new employment opportunities in domestic manufacturing.
However, the future of U.S. manufacturing remains to be seen. Businesses will undoubtedly experience some growing pains as they transition away from long-held practices.
For reshoring to truly stick, manufacturers must offer improved products and impeccable customer service that will surpass foreign manufacturers.
Their efforts should involve tactics including but not limited to:
• Maintaining quick responsiveness to RFQs;
• Communicating proactively about ways to lower customer costs or decrease lead times;
• Providing failsafe security and IP protection;
• Consistently delivering orders on time.
Manufacturing added 32,000 jobs in October, according to data released by the Bureau of Labor Statistics on Friday. America’s factories are booming, gaining an average 37,000 jobs per month in 2022.
Alliance for American Manufacturing President Scott Paul said:
“Factory jobs continue to be a reliable engine of job growth, particularly for workers who aren’t seeking a four-year degree. The investments made over the past year in infrastructure, clean energy, EVs, and semiconductors should continue to pay job dividends next year and beyond. But there are threats to this growth: an overzealous Fed, global headwinds, and unwelcome pressure to lower tariffs and Made in America requirements.
“Congress and the administration should stay focused and continue to build on the policy support that has laid a foundation for factory job growth. Today’s jobs numbers show what can happen when we begin to put an industrial policy in place.”
The Biden-Harris Administration is announcing a new set of public and private sector commitments aligned with President Biden’s Federal Buy Clean Initiative, which leverages the Federal Government’s power as the largest purchaser in the world to advance low-carbon construction materials across its procurement and funded infrastructure projects.
Partnerships between state, Tribal, regional, local and industry leaders are critical to ensure that Buy Clean investments in clean manufacturing and climate-resilient infrastructure benefit all Americans across the country.
President Biden’s Action Plan to Accelerate Infrastructure recognizes that over 90% of bipartisan Infrastructure Law funding is delivered by non-federal agencies, underscoring the need for strong partnerships across public and private sectors. Building on recent Administration announcements through the Federal Buy Clean Initiative, the actions to create more, good paying manufacturing jobs while tackling the climate crisis.
Last month, the Administration announced a major set of Buy Clean initiatives, including a policy to prioritize the Federal Government’s purchase of steel, concrete, asphalt, and flat glass that have lower embodied emissions across their lifecycle—including manufacturing, transportation, installation, maintenance, and disposal. These construction materials account for nearly half of all GHG emissions from U.S. manufacturing.
Strong partners in the manufacturing sector are innovating and investing in scaling up production of lower-carbon materials. At the same time, design, architecture and engineering firms are integrating cleaner materials into project designs, and major corporate purchasers are sending clear demand signals.
An article at Mondaq.com goes into some detail about the many opportunities presented by the recently passed Inflation Reduction Act (IRA).
Among other things, the Act saw the introduction of a number of new and expanded tax credits aimed at onshoring American manufacturing, representing opportunities for manufacturing within critical industries, in particular those industries that are key players in the Biden administration’s goal to address climate change. The incentives range from tax credits directly to manufacturers of certain equipment to incentives for taxpayers to purchase equipment from American manufacturers.
Many of the tax credits will go into effect on January 1, 2023. Treasury and the White House have stated that they will work with industry to ensure that the regulations have a broad consensus and can benefit both large and small manufacturers. Credits are available on an annual basis for eligible components sold beginning in 2023, going through 2032 (with a phaseout beginning in 2030).
One example: a new production tax credit was introduced with the IRA. Eligible components include components within wind, solar, and battery projects, such as PV cells, PV wafers, solar modules, blades, nacelles, inverters, and battery cells and modules, among many others.
The IRA also expanded a tax credit that provides incentives for solar manufacturers, among other clean energy producers, for purchasing and commissioning property to build a manufacturing facility before January 1, 2025.
For taxpayers that don’t have the tax appetite to claim the credits on their returns directly, the IRA enacted two new provisions that may help taxpayers take advantage of these credits. Manufacturers can receive a direct cash payment from Treasury for the first five years for which the manufacturer would otherwise have been eligible for the credit.
FastCompany has an article explaining why the supply chain is still kind of a mess, and when experts believe it will finally return to normal.
Here are six trends experts are seeing regarding the supply chain.
1. GOVERNMENT INTERVENTION REMAINS A POSSIBILITY
While governments have tried to clear a path as much as possible for shipping companies, they’ve resisted a direct hands-on approach through this crisis. That might change, however.
“One of the ways governments are starting to respond to the challenges these dynamics present is to look more closely at supply chains and supply chain resilience as a national security imperative,” the report reads. “If this continues–as it seems likely to do–government intervention with trade and sourcing is likely to become a more pronounced challenge for supply chain managers. The war in Ukraine has amplified and accelerated trends already set in motion.”
2. LAST YEAR’S SHORTAGES COULD TRANSFORM INTO NEXT YEAR’S OVERSUPPLY
Early this summer, Walmart, Target, and others had huge discounts on clothing and home goods because a lot of the materials they had ordered up to a year ago finally hit stores, overwhelming them with inventory. For a brief moment, supply outstripped demand. As we head toward a recession, consumer demand is likely to be reduced in the months to come. And that could make things even more challenging for the shipping/supply industry on a different level.
Put another way: Lower demand could result in oversupply.
3. THE LABOR MARKET ISN’T EXPECTED TO IMPROVE
The labor issues that have plagued so many companies for the past year are just as prevalent, if not more so, in the shipping industry. As in many industries, workers are seeking pay increases to keep up with inflation.
4. THERE MAY SOON BE A SURPLUS OF SHIPS
Next year is expected to see a rush of new vessels. Some 28% of the current installed fleet capacity is on order and just under half of that is expected to be delivered over the course of next year. That could make container rates lower, which could work out well for consumers, as shipping costs could drop.
5. CLIMATE CHANGE COULD POSE ADDITIONAL PROBLEMS
Ecoclimate issues could present just as notable a roadblock for shippers. Low levels in Germany’s waters are impacting economic activity. And in the U.S., the Mississippi River is seeing falling water levels, which has resulted in a log-jam of over 100 vessels. There are heat waves in China and hurricanes are becoming stronger than ever. All of these present an opportunity to disrupt supply chains around the world.
6. THINGS ARE GETTING BETTER
Signs are now pointing to a better year in general for supply chains in 2023. The Logistics Managers’ Index for September read “September’s future predictions hint at normalization and a return to business as usual over the next year.”
“How long will it take for this gradual improvement to get to a point where the market is fully back to normal?” the report reads. “There are multiple different ways to look at this, [but all indicate] a full reversal to normality should come in March 2023.”
Unionwear is pleased to announce that, once again, we received an A+ supplier rating from SAGE, a platform that Unionwear’s clients use to search for products.
Unionwear has received this designation many times in the past. What makes this year’s announcement special to us, however, is that we were able to achieve the rating during the pandemic and unprecedented supply chain upheavals. Since our clients are the ones who are giving us the ratings, we know that Unionwear delivers top-quality products and excellent customer service even during unprecedented disruption.
Furthermore, Unionwear is one of only a handful of union-made in USA manufacturer of hats, bags, portfolios, and other promotional products. Not only are we a union made in America manufacturer, but our business model allows us to create highly customized solutions so clients can get exactly what they want. That’s why Unionwear can claim we make “a trillion hats,” because we can create exactly what you want in a timely and cost-competitive way. Even in late-2022, clients are still struggling to get orders into their customers’ hands, and once they realize their orders are stuck, they turn to Unionwear. Thanks to our team’s hard work and customer success, we are even looking to grow our business, even as others struggle to keep up with rising costs across the board.
Everyone at Unionwear worked together to achieve this A+ status and we look forward to working with a wide variety of promotional product professionals. Email us at orders@unionwear.com to get the exact items you want on time at a fair price.
If you want to keep ahead of everything supply chain, one great resource is Supply Chain Brain. In this article, they offer four ways companies can mitigate supply chain headaches due to US-China tensions.
The gravity of the situation is compelling U.S. companies to shield their supply chains from the ensuing volatility and uncertainty. While many prepare for the impact of China’s isolation from U.S. markets, others fear significant damage to their businesses if they oust themselves from the Chinese market or supply chains.
To ensure that U.S. companies aren’t impacted by trade tensions in the near future, they must act now. Business leaders need to expand their horizons beyond China. Following are a few crucial actions they can take to help mitigate the risks emerging from the current trade conflict.
Monitor U.S.-China developments closely. Global trade conflicts almost always come along with sanctions, tariff rises, and regulatory burdens imposed by governments on both sides. Since 2018, the U.S. and China have been involved in a war of tariffs and retaliatory tariffs. The brunt of this multifaceted tension is manifesting itself through supply chain inefficiencies, disruptions in transportation routes, and hikes in tariffs and duties. To stay updated on the trends, monitor press releases and publications on various government portals like the U.S. Department of Homeland Security, U.S.-China Business Council, U.S. International Trade Commission, and U.S. Customs and Border Protection.
Diversify your supply chain, including reshoring and nearshoring manufacturing. The U.S. tariffs on Chinese imports led to rising supply chain costs, decreasing profits for the U.S. industries, and ever-increasing uncertainty. In response to this, the number of U.S. companies sourcing from other countries shot up. It’s time for all companies to start exploring new manufacturing opportunities. U.S. companies are nearshoring or relocating their supply chains closer to home in markets such as Mexico. U.S. imports from Mexico have increased around 25% in the last five years, and we see that trend continuing this year as well.
Collaborate with suppliers. U.S. companies must understand the crucial need for collaborating with their suppliers for risk mitigation. U.S. companies must start focusing on increasing transparency in their supply chains. Businesses must be able to map all the nodes in their supply chain. Deeper collaboration with existing suppliers and the use of external supply chain intelligence tools can generate real-time insights on suppliers’ suppliers, as well as other risks that are hidden in the deep tiers of supply chains.
Seek support from the government. In a recent bid to fight aggressive Chinese trade advances, the U.S. government put forth a strategic approach that focuses on investing in domestic industry, technology and infrastructure, and aligning with partners and allies to combat China’s actions globally. There are some great government initiatives such as the National Export Initiative and Trade Americas, and bodies like the Office of the United States Trade Representative, aimed at assisting U.S. exporters with their business expansion.
Now is the time to start looking at these as viable strategies to mitigate the volatility coming from China. Read more about it here.
Unionwear is a big believer in reshoring manufacturing from foreign countries — especially China — back to the USA. Obviously, it is good for the US to create more jobs. But it’s also good for business. Supply chain disruptions have crippled businesses for over two years and there is no sign of slowing, especially given the sorry state of US-China relations, and companies should get started bringing manufacturing back to the US before they find themselves in a predicament they can’t easily get out of. Freightwaves has a lengthy article on this very topic, highlighting a combination of covid, Taiwan, and Chairman Xi’s approach to business.
The most immediate impact to supply chains in Chinese president Xi Jinping’s third term will feature his signature zero-COVID policy. China’s draconian surveillance and control regime of tests, quarantines and lockdowns seemed to work well enough for a year. Xi’s policy held down infection rates and kept the economy pointed up and to the right.
When the Omicron variant’s greater infectiousness overwhelmed mask and vaccine protections, China kept forcefully applying lockdowns, massively disrupting both its own economy and trans-Pacific trade in general. The consensus of the international financial community is that China’s zero-COVID policy under Omicron has been a disaster casting a pall over the global economy.
But whether or not Xi rolls back his zero-COVID policy or not, the future of the trans-Pacific is troubled. For instance, former President Donald Trump’s tariffs set off panicked behavior by U.S. importers that roiled the trans-Pacific. Companies accelerated the timelines on their purchase orders, “pulling forward” shipments that were originally scheduled to arrive after new tariffs took effect in order to avoid paying the duties. A logjam of volume increased rates, reduced schedule reliability, congested ports and filled warehouses, especially in Southern California.
And that’s just the beginning of our troubles. In fact, we believe tensions between our two countries will likely continue into the near future, leaving open the question of whether American firms can still trust China as a reliable partner. In the near-term, we believe the answer is no.
CNN reports that President Joe Biden’s Energy Secretary is awarding $2.8 billion in grants from the bipartisan infrastructure law passed last year. Twenty manufacturing and processing companies for projects across 12 states will receive grants, which include components affecting both the electric grid and electric vehicles.
Biden also announced the formation of the American Battery Materials Initiative, which the White House has called “a new effort to mobilize the entire government and securing a reliable and sustainable supply of critical minerals used for power, electricity and electric vehicles.”
The funding will be spent in Alabama, Georgia, Kentucky, Louisiana, Missouri, Nevada, New York, North Carolina, North Dakota, Ohio, Tennessee and Washington. It is expected to create 8,000 jobs, officials on a call with reporters ahead of the announcement said. The projects are expected to “develop enough lithium to supply over 2 million electric vehicles annually and establish significant domestic production of graphite and nickel,” according to the fact sheet.
Wednesday’s investment marks “the first of several rounds of investment in the battery supply chain,” a senior administration official on the call said.
The private sector, which was represented at Wednesday afternoon’s event, is expected to match the federal government’s investment.
“The recipients of federal grants to invest and build out the domestic supply chain are required to at least match the federal funding with private sector capital. They’ve more than done that in this case. So, the $2.8 billion is being leveraged for a total of a $9 billion investment today,” the official said.
Executives with Schneider Electric and Deere & Co. report that they will expand factories to three states. Deere will even reshore some production to the United States from China.
Schneider will put to work a total of $46 million at plants making circuit breakers and other electrical output products in Lexington, Kentucky, and Lincoln, Nebraska. Schneider employs about 128,000 people around the world and makes a wide range of electrical, automation and energy management products. They are doing this because they are shortening their supply chains via a series of North American investments totaling more than $100 million and adding capacity in Texas and Mexico.
Deere’s Louisiana plans call for the maker of agricultural and construction equipment to invest nearly $30 million to grow its operation in Louisiana, near New Orleans. That facility today designs sugar harvesting and earthmoving equipment and makes a range of products but will grow in the next two years to also produce medium-chassis cotton harvesters now being built in China.
The article first discusses how automation has played a central role in Unionwear’s growth, especially following the pandemic. Mitch recently invested roughly $1 million in tech upgrades to help meet demand.
Furthermore, Mitch discusses how the supply chain issues have not harmed Unionwear’s business, since they are reliant on domestic materials.
Additionally, he discusses how his made in America products are actually much more cost-effective, especially when you take into account the entire actual cost of manufacturing domestically. He is even considering manufacturing shirts in the near future as well.
Reshoring manufacturing is accelerating, largely driven by supply chain disruptions due to the pandemic. Companies are learning that they can’t get their products from overseas, especially China and Russia. While this is no doubt good for creating American jobs, there might be an unintended benefit to this as well: sustainability.
“Due to the proximity of the supply chain network, reshoring is expected to positively impact the scope 3 carbon emissions from supplier transportation and distribution,” said Makarand Karanjikar, senior vice president of supply chain deployment at Schneider Electric.
Karanjikar said the pandemic was “key in identifying vulnerabilities in supply chains and how prone they are to disruption.” Schneider Electric is aiming to have at least two sources for all of its critical parts and raw materials by the end of 2023.
“We have eliminated our dependence on any single country or region to avoid any geopolitical risks, and we are also driving some specific regionalization programs to shorten our supply chain and to manufacture close to our customers,” Karanjikar said.
Shifting operations from abroad back to the U.S. can lower greenhouse gas emissions in two ways: from avoiding emissions associated with shipping goods long distances overseas and from reducing emissions associated with production. That’s because the shorter you make the transportation cycle, the more you reduce your carbon footprint.
National Defense Magazine wrote an opinion article on why we must Americanize the US Defense Industry supply chain, and we at Unionwear agree.
The opinion piece cites that high-ranking U.S. officials and corporate executives have been saying, for years, that U.S. national security is at risk due to our military’s reliance on foreign nations for raw materials, parts and products. It is time for leaders to walk their talk and wrestle back the manufacturing and defense industrial base.
U.S. corporations have outsourced more than 5 million jobs and 91,000 manufacturing plants since 1998, according to the Economic Policy Institute. The closing of factories in the nation for the past 24 years has forced the U.S. military to increasingly rely on imports to keep forces armed and ready.
This opinion is strongly bi-partisan and should not be controversial.
President Donald Trump in 2018 identified hundreds of instances where the U.S. military was dependent on foreign countries, especially China, for critical materials. For example, an analysis from the U.S. Geological Survey at the time said the United States produced no rare earth minerals in 2017, while China accounted for 81 percent of global mining production. Rare earth minerals are used in magnets, radars and other electronics critical to defense systems.
The next administration raised the same concerns. A February report developed on the order of President Joe Biden warned of the consequences of low manufacturing investment in the United States. The study pointed out that the U.S. share of the world market in goods has continuously declined, and manufacturing output as a percentage of GDP has similarly declined, from more than 25 percent in 1947 to 11 percent at the end of 2020. The report went on to outline 64 recommendations as initial steps in a longer-term effort to build a strong and responsive supply chain in the coming years.
Despite the warnings, the situation continues to get worse. The COVID-19 pandemic highlighted the need for a continued push for onshoring and revitalizing North American manufacturing. When the outbreak began, supply lines necessary to sustain production within the defense industry were frozen, drawing attention to the vulnerability of the defense industrial base to being cut off. According to the consulting firm McKinsey and Company, only 22 percent of automotive, aerospace and defense players had regionalized production to boost their supply chain resilience by May 2020, even though they indicated previously they had prioritized the approach.
What got us here? It all boils down to companies chasing short-term profits to satisfy shareholders at the expense of loyalty to the United States, coupled with a fierce competitive landscape. Once a major manufacturer outsources, others in the industry have no choice but to follow suit to realize the same decreased costs.
It is time that the nation’s leaders heed the alarm bells, adopt the suggestions to Americanize the supply chain with haste and not let political roadblocks slow us down. We cannot afford to be hijacked by shortages, shipping delays, security threats, natural disasters or pandemics. With today’s modern technology, we can control costs and level up our workforce to jobs that will spur even greater innovation.
According to a news release, USDA Secretary Tom Vilsack announced $500 million in grants available to increase American-made fertilizer production to spur competition and combat price hikes on U.S. farmers caused by the war in Ukraine.
Grants will be used to support independent, innovative and sustainable American fertilizer production to supply American farmers. Funds also will expand the manufacturing and processing of fertilizer and nutrient alternatives in the U.S. and its territories.
The program will support fertilizer production that is:
Independent, and outside the orbit of dominant fertilizer suppliers. Because the program’s goal is to increase competition, market share restrictions apply.
Made in America. Products must be produced by companies operating in the U.S. or its territories, to create good-paying jobs at home, and reduce the reliance on potentially unstable, inconsistent foreign supplies.
Innovative. Techniques will improve fertilizer production methods and efficient-use technologies to jumpstart the next generation of fertilizers and nutrient alternatives.
Sustainable. Ideally, products will reduce the greenhouse gas impact of transportation, production and use through renewable energy sources, feedstocks and formulations, incentivizing greater precision in fertilizer use.
Farmer-focused. Like other Commodity Credit Corporation investments, a driving factor is providing support and opportunities for U.S. agricultural commodity producers.
Eligible entities are for‐profit businesses and corporations, nonprofit entities, Tribes and Tribal organizations, producer‐owned cooperatives and corporations, certified benefit corporations, and state or local governments. Private entities must be independently owned and operated to apply.
The maximum award is $100 million. The minimum award is $1 million. The grant term is five years.
According to a survey conducted by Xometry, CEOs whose companies depend on manufacturing to produce and deliver their goods are demonstrating supply chain resilience by investing in talent and technology while reshoring and nearshoring their manufacturing capabilities.
The quarterly survey, which tracks CEO and decision-maker sentiment at more than 150 leading companies nationally, reveals that 90% of CEOs expect supply chain concerns to stretch well into 2023.
But it reveals resilience in the face of continued disruption.
The majority of CEOs – 80% – are planning capital investments
Nearly 70% of CEOs said they are investing in employees
66% are investing in automation and workflow operations
63% are embracing emerging technologies like Artificial Intelligence (AI)
Nearly two-thirds (64%) of the CEOs say they are currently reshoring or nearshoring their operations, or planning to
25% planning to expand their offshoring capabilities and 11% are planning no changes
“In our 40 years of probing CEOs, business decision-makers and influencers, this survey of manufacturing executives certainly stands out,” said Jeremy Zogby, Managing Partner of Zogby Strategies. “The data confirms that executives, while having faced a myriad of disruptions, remain resilient and innovative, looking ahead with confidence and doubling down on talent and tech to strengthen their operations to minimize any future potential concerns.”
Skyrocketing gas prices in Europe is forcing European manufacturers of steel, fertilizer and other feedstocks of economic activity to shift operations to the US. These firms are attracted by more stable energy prices and muscular government support, including a raft of incentives for manufacturing and green energy. Also, new spending by Washington on infrastructure, microchips and green-energy projects has heightened the U.S.’s business appeal.
“It’s a no-brainer to go and do that in the United States,” said Ahmed El-Hoshy, chief executive of Amsterdam-based chemical firm OCI NV, which this month announced an expansion of an ammonia plant in Texas.
Despite inflation and other Covid-related supply chain problems, the US has emerged relatively strong from the pandemic, especially as China continues to enforce Covid lockdowns and Europe is destabilized by war.
Good news: The Biden-Harris Administration is serious about bringing manufacturing back to the US.
The Administration announced new actions under its Federal Buy Clean Initiative in Toledo, Ohio, to spur the development of low-carbon construction materials made in America while supporting good-paying jobs. Transportation Secretary Pete Buttigieg, U.S. General Services Administration Administrator Robin Carnahan, and Deputy National Climate Advisor Ali Zaidi announced the Federal Government will prioritize the purchase of key low carbon construction materials, covering 98% of materials purchased by the Federal Government, while visiting a Cleveland-Cliffs Direct Reduction steel plant in Toledo.
The Federal Buy Clean Initiative is a part of President Biden’s economic plan—including the Bipartisan Infrastructure Law, Inflation Reduction Act, and CHIPS and Science Act—to usher in a manufacturing boom in America. The Initiative ensures that federal financing and purchasing power are creating good-paying jobs, protecting public health, enhancing American competitiveness, and strengthening national security.
The Administration will:
Prioritize the Federal Government’s purchase of steel, concrete, asphalt and flat glass that have lower levels of emissions.
Expand lower-carbon construction materials used in federally-funded projects.
Convening states to partner on Buy Clean:
Increase data transparency through supplier reporting to help American manufacturers track and reduce emissions.
Launch pilot programs to advance federal procurement of clean construction materials.
This is great news for the Made in America movement, and we look forward to learning more about how the US government will continue to build on these successes.
Fast Company shares some ideas on how the US can make EVs without China, but it won’t be easy.
China currently controls 60% of the world’s lithium mining, 77% of battery cell capacity, and 60% of battery component manufacturing. Many American EV makers, including Tesla, rely heavily on battery materials from China.
In the short term, the US needs to rely on strategic partners overseas. The recently passed Inflation Reduction Act allows imports of critical minerals from countries with free trade agreements to qualify for incentives, but not imports of battery components. This means suppliers like Korea’s LG Chem, SK Innovation, and Samsung SDI, which supply 26% of the world’s EV batteries, are shut out. In the spirit of friendshoring — that is, reshoring manufacturing to allies and key partners, the Biden administration could issue a temporary waiver that makes it easier for Korean battery makers to move more of their supply chain to the U.S.
In the mid- to long-term, a concerted trade and diplomacy effort will be necessary for the U.S. to secure critical mineral supplies. The Democratic Republic of the Congo, where 70% of the world’s cobalt is mined, and Chinese companies control 80% of those supplies. To counter this, the Biden administration’s “friendshoring” vision has a chance only if it can diversify the lithium and cobalt supply chains.
More than 15 years ago, NY Times columnist Thomas Friedman wrote “The World is Flat.” The premise of the book was that, as the world becomes more interconnected, we will be increasingly in competition with other talented people and companies around the world.
Last week, another NY Times Columnist (and Nobel-prize winning economist) Paul Krugman wrote that world is currently becoming less flat.
Krugman cites a recent Bloomberg review of C.E.O. business presentations which found a huge surge in buzzwords like onshoring, reshoring and nearshoring, all indicators of plans to produce in the United States (or possibly nearby countries) rather than in Asia. As such, we may be seeing early indications of a partial retreat from globalization. This is happening for a couple of reasons.
First, companies talking about reshoring production often make the point that modern techniques in some cases allow them to produce with relatively few workers, making cost savings from outsourcing becoming outweighed by the logistical advantage of producing close to home.
Second, producers are learning that the world is a dangerous place, especially when you rely on countries with authoritarian regimes like China. Indeed, the arbitrariness of Xi Jinping’s Covid lockdowns have made businesses newly nervous about relying on Chinese suppliers.
A third reason is politics. Some of the recent policies the US introduced will be at least mildly protectionist. Notably, the new tax credit for purchases of electric vehicles will apply only to vehicles assembled in North America.
According to CleanTechnica, solar power manufacturer First Solar announced a $1.2 billion expansion plan, including up to $1 billion to add a fourth factory to the company’s roster in a state to be named later. About $185 million will also go to upgrade the capacity of First Solar’s operations in Ohio. Altogether, the company expects to have more than 10 gigawatts in capacity online by 2025.
The story of how we got here is not straightforward.
The US once had a lock on the global solar manufacturing scene. Bell Labs introduced the first practical solar panels in the 1950s, and US manufacturers began churning them out for the space program and other niche applications domestically and elsewhere around the globe.
By the 1980s, though, US manufacturers began losing out to Japan, and it was all over when China entered the picture. By the 1990s, the US Department of Energy was casting about for a way to revive the domestic solar industry. Labor costs were one of the leading obstacles, partly due to the use of silicon as the material of choice for solar panels. The hunt was on for new materials that would be a better fit for high volume, high throughput, automated manufacturing systems.
Additionally, few can satisfy the made-in-America purity test. Some operate under the umbrella of corporations headquartered overseas, and some assemble solar panels from parts made overseas. This purity test may seem somewhat out of step in a globalized economy, but if domestic energy security is the goal, then a soup-to-nuts domestic manufacturing base is a priority.
Thanks to some hard work by government partners and First Solar, this announcement finally came to fruition.
Democratic US Representative Marcy Kaptur of Ohio’s 9th Congressional District said this in a statement: “Northern Ohio has already revolutionized the field of solar technology. Now, through this remarkable partnership between the U.S. Department of Energy, the University of Toledo, and First Solar – our region will become a hub of next-generation energy innovation that is built right here at home by Ohio’s workers.”
According to PV Magazine, Canadian battery developer Zinc8 Energy Solutions announced its plans to begin battery production in the United States incentivized by manufacturing production credits within the Inflation Reduction Act.
Zinc8 Energy Solutions has developed a proprietary flow battery technology that can reportedly deliver power from 20 kW to 50 MW that can store and discharge energy durations from 4 to 100 hours.
Unlike lithium-ion technology, which requires new stacks to scale, Zinc8 says it has decoupled the linkage between energy and power. This means that scaling Zinc8’s technology can be accomplished by simply increasing the size of the fuel tank and quantity of recharged zinc fuel.
According to the manufacturer, the technology promises zero capacity fade over an extensive lifetime, and the batteries are non-flammable, non-toxic and sustainable with stable supply chains for mass production.
The company chose Ulster County in Upstate New York after US Senator Chuck Schumer personally called the CEO of Zinc8 to urge the company to expand their operations in Ulster County.
“Zinc8 is the jolt of electricity the Hudson Valley needs, and is proof positive that when you invest in fighting climate change you are investing in creating good-paying jobs, new economic growth, and a brighter future for our communities, As the EPA officially begins cleanup of this once-contaminated asbestos dumping ground,” Senator Schumer said. “I can think of no better way to usher in a renaissance for Ulster County than by making this the foundation for supercharging the fight against climate change with an investment in clean tech manufacturing.”
Until fairly recently, the majority of Americans didn’t think twice about the supply chain. If we wanted something, we would put it on a shopping list, go to the store, and somehow that thing would just… be there.
The phrase “supply chain” is now synonymous with a roulette wheel — sometimes the products you want are there, other times, products are out of stock.
But that’s not the entire story. The other supply chain problem is the talent supply chain of skilled labor.
While many industries are confronting a labor crunch, transportation’s talent supply chain is facing a triple threat of labor shortages that begin with recruitment and retention challenges, compounded by an imminent retirement wave, and coupled with a coming technology transition.
Just as $1 trillion of federal spending to rebuild the nation’s infrastructure is set, there is a shortage of construction workers to repair crumbling roads, ports, and rails. According to an analysis by the Associated Builders and Contractors, there were 396,000 open construction jobs in March 2022 — a full 60,000 more than the year before.
Furthermore, the coming electrification of the transportation system will ultimately require a new workforce, as well as training a new generation of workers to maintain electric vehicles and robotic systems.
Moreover, to successfully integrate the nation’s power infrastructure with the transportation system will need a specialized workforce to build, operate, and maintain an electricity generation and distribution system will also be required to meet unprecedented power demands.
The opportunity is for younger workers who have a knack for mechanics — jobs, and wages, across the transportation sector will probably surge.
Marketplace has an article quoting the Reshoring Initiative, who noted that American companies are on pace to reshore nearly 350,000 jobs this year, the highest number in recent history.
As we have said in this blog for some time, global manufacturing and logistics have seen lots of hiccups recently, helping to motivate the movement back to the U.S.
Additionally, the pandemic repeatedly shut down factories in China, while fires and flooding have done the same in Japan and Thailand. There was that ship that got stuck in the Suez Canal. Add in skyrocketing shipping costs.
The U.S. will not become a leader in manufacturing apparel or toys. But it is gaining jobs in high-tech manufacturing for things like semiconductors and electric vehicle batteries.
David Simchi-Levi, a data scientist at the Massachusetts Institute of Technology, said tensions between the U.S. and China and legislation like the CHIPS and Science Act and the Inflation Reduction Act will incentivize manufacturing in this country.
CNBC reports that the US supply chain is now facing two separate hurdles: one in Europe, the other in China.
First, a heatwave in China has shut down key manufacturing facilities there. Second, negotiations between the trade union verdi and the Central Association of German Seaport Operators (ZDS) remain inconclusive.
“If no compromise will be made, we can expect further strikes which will, even more, worsen the already stressed situation in the Northern Ports,” explained Andreas Braun, Europe, Middle East, and Africa ocean product director of Crane Worldwide Logistics. “Congestion, vessel schedule, and intermodal operations are already a mess and further strikes will just contribute to it. We will not see a change back to a normal situation before Q1 2023.”
Meanwhile, high temperatures in China are forcing some manufacturers to shut down production for six days because of government planned power cuts. Power limit notices for manufacturers in Changzhou, Nanjing, Nantong, and other regions in Jiangsu province have Worldwide Logistics alerting import clients in an email that, “The sudden orderly power consumption notice has made the supply chain more challenging under (the) current situation of (the) COVID -19 epidemic.”
Yahoo! News reports that the global supply chain is going to take at least another eight years to be reconfigured.
As we have said quiteextensively, the supply chain is in chaos. And there doesn’t seem to be an end in sight. Expert Mark Millar said this opens an opportunity to reevaluate sourcing and production. One such solution is to consider a more regional approach going forward, something others have called friendshoring, others still are considering nearshoring. He also expects global supply chain reconfiguration to last through 2025 to 2030. Geopolitical instability, including the Russian invasion of Ukraine, haven’t helped to say the least. And, since future conflicts are possible, that will mean even more disruption.
How should companies fix the problem?
In the short-run, collaboration between supply chain partners is the practical way to get through the crisis. This includes finding alternative sources or transportation routes that may be more expensive but can deliver goods to their final destination.
On a medium-term basis, the disruption has created an opportunity for reevaluation after 30 years of globalization. For instance, companies might want to take a more local and regional approach in the future that would build more resilience into their supply chains and reduce emissions. Some businesses are already reconfiguring their supply chains, moving sourcing and production closer to the final destination market.
What is friendshoring? Basically, it means that the US and its strategic partners should create trade routes with partners who broadly share our values, instead of assuming 100% of manufacturing can, or should, take place in the US.
In a report on America’s supply chains earlier this year, the Biden administration warned: “The United States cannot make, mine, or manufacture everything ourselves. We must cooperate with our allies and partners to foster and promote collective supply chain resilience.”
Treasury Secretary Janet Yellen echoed this idea in a speech to the Atlantic Council. “Favoring the friendshoring of supply chains to … trusted countries, so we can continue to securely extend market access, will lower the risks to our economy as well as to our trusted trade partners.”
This is not without risks. Friendshoring is part of a “deglobalization” process, which could see further supply shocks and higher prices in the short term and lower growth in the long run.
The United States isn’t always seen as an exporter, especially when it comes to manufacturing garments. But, in fact, the US really does export quite a bit. Apparel Resources reports that the USA exported $2.87 billion worth of garments from January to May in 2022.
Canada was the top destination that sourced $816.29 million worth of garments, noting an 18.1% yearly surge.
Mexico comes second with import value reaching $712.84 million, growing at the rate of 38.4%. It’s worth noting that both Canada and Mexico are trade partners to USA under USMCA agreement and enjoy preferential trade advantages.
Meanwhile, Nicaragua and Guatemala sourced $156.11 million and $93.97 million worth of garments respectively, while the UK’s import value reached US $ 89.17 million.
CNBC reports that Renault’s CEO believes there will be no sudden let up in the supply chain shortages that have dogged the autos industry, even as the carmaker dubbed its “emergency” period over.
“We don’t anticipate a sudden, complete improvement of the situation. But, in the meantime, we have learned to manage this complexity,” de Meo told CNBC’s Charlotte Reed.
“We think the situation [is] getting better; May and June were not so bad. But, of course, we are missing full transparency on supply chains because the world is becoming more complicated in general,” he said.
He added that the sourcing of raw materials would continue to be an issue for automakers but added that the company had grown more resilient.
We have seen this kind of resilience across manufacturing. Unionwear, too had to be flexible and nimble during the supply chain crisis. However, it is worth noting that these issues are mitigated by those companies which manufacture domestically.
No single cause accounts for the microchip shortage. COVID-19 has had an outsized effect on the problem, as factories and ports closed while millions of people worldwide established home offices. But other contributors include labor shortfalls, lack of raw materials, trade tensions, and the growth of 5G electronics, which require more chips than previous generations of devices.
How are they responding?
Most immediately, companies are taking whatever microchips they can get and then building more adaptive manufacturing processes to deal with the obstacles that arise from this indiscriminate approach.
Companies are also looking into ways in which rewriting software might patch some of the shortage; perhaps code can be rewritten in such a way that a single chip can do more work than it formerly did.
In other words, they are getting creative, which is what Unionwear had to do at the outset of the pandemic as well.
The latest Bloomberg analysis shows US executives have been saying onshoring, reshoring or nearshoring at a greater rate this year than during the first six months of the pandemic, according to earnings call and conference presentations Bloomberg reviewed. There are concrete signs that many of them are going beyond just talk and acting on these plans.
New manufacturing soared 116% over the past year, dwarfing the 10% gain on all building projects combined, according to Dodge Construction Network. Massive chip factories are going up in Phoenix; Intel is building two just outside the city. And aluminum and steel plants that are being erected across the south, including in Bay Minette, Alabama; Osceola, Arkansas; and in Brandenburg, Kentucky.
Near Buffalo, New York, new semiconductor and steel output is fueling orders for air compressors that will be cranked out at an Ingersoll Rand plant that had been shuttered for years.
Scores of smaller companies are making similar moves, according to Richard Branch, the chief economist at Dodge. Granted, some new construction is to expand capacity.
But they all point to the same thing — a major re-assessment of supply chains in the wake of port bottlenecks, parts shortages and skyrocketing shipping costs that have wreaked havoc on corporate budgets in the US and across the globe.
This report from the Staffing Stream says frontline supply chain workers are quitting at a record rate. As the workforce shortage worsens, businesses are left scratching their heads as to what to do about it.
Some brands, such as Walmart and Costco, are raising wages to combat the crisis. But a Q1 survey of more than 20,000 supply chain workers shows that pay is not a top reason for turnover. It’s not even in the top five. If brands don’t start to better understand their hourly workforce, the Great Resignation may be here to stay. Here’s what you need to know to rise above it.
How to solve the problem
The number one reason hourly workers are quitting: career growth. Hourly employees are looking for long-term, rewarding careers. Yet many organizations have not embraced this idea. As a result, workers leave for companies that will offer opportunities to advance.
Furthermore, according to research, employees feel like they have little to no opportunity to provide feedback. In fact, that is the second-greatest reason for turnover. For 40% of frontline workers, management never asks for any feedback at all. But the issue doesn’t end there. Seventy percent of frontline workers who share feedback with leadership feel that their voices aren’t being heard.
It’s no wonder why management doesn’t understand why employees still quit after a pay raise. They simply aren’t listening.
In sum, get feedback from your team and give them a sense of purpose. It’s never been more critical to continuously gather real-time feedback from employees. More importantly, managers and leaders need to take action on that feedback. Then you can focus on greater pay.
MSN reports that supply chains are set to wait as unionized dockworkers and the shipping operators at the US West Coast ports negotiate a new labor contract after the previous contract expired this past Friday.
“While there will be no contract extension, cargo will keep moving, and normal operations will continue at the ports until an agreement can be reached between the Pacific Maritime Association (PMA) and the International Longshore & Warehouse Union (ILWU),” the two sides said in a joint statement ahead of the 8:00 PM ET expiration of the current contract. “Both sides understand the strategic importance of the ports to the local, regional and US economies, and are mindful of the need to finalize a new coast-wide contract as soon as possible to ensure continuing confidence in the West Coast.”
Negotiations can exceed deadlines without seriously disrupting operations. The alternative would be costly: Data commissioned in 2014 by the National Association of Manufactures (NAM) and the National Retail Federation (NRF) estimated that port operations stopping for five days would cost the U.S. economy $1.9 billion. With the current supply chain in chaos and inflation, that sum that would certainly be higher in 2022.
The current talks, which began on May 10 in San Francisco, are unfolding at a moment when the U.S. labor movement has shown leverage amid election victories at dozens of Starbucks (SBUX) locations and “the most pro-union president leading the most pro-union administration in American history.”
As the US moves to crack down on goods that may be linked to forced labor in China’s northwestern Xinjiang region, it is demanding fashion brands importing to the US show who made their clothes and the materials in them.
A new law that came into force on Tuesday requires companies to prove any imports to the country that could be linked to the region are free of forced labor, adding an unprecedented regulatory layer to calls for greater supply chain oversight in the industry.
The law, according to Axios, is called The Uyghur Forced Labor Prevention Act. If strictly implemented, could reroute certain global supply chains away from China.
“Everyone is waiting to see how this shakes out in reality,” said Jessica Rifkin, a lawyer who leads the customs, trade and litigation practice group at Benjamin L. England & Associates.
“This has the potential to really cause widespread effects, especially if the law is enforced to a T, completely as written.”
Unsold inventory is already piling up at cotton mills in Xinjiang, according to reporting from the South China Morning Post, as foreign companies have sought to bring their supply chains into compliance with the new U.S. law.
The Biden administration has said it plans to fully enforce the law. High-risk sectors like apparel are likely to face enhanced checks from US Customs and Border Protection, even if shipping from other countries, global risk consultancy Maplecroft said in a briefing note last month.
Until now, “it’s been a free for all; there’s been no meaningful regulation,” said Scott Nova, executive director of the Worker Rights Consortium, a steering committee member of the Coalition to End Forced Labour in the Uyghur Region. “The industry likes to put out the idea that this is impossible, that the true source is some kind of unfathomable mystery. But it’s not. It just requires significant effort.”
Yahoo! News reports that the US Congress is seeking to more than double the net worth of the national strategic mineral stockpile to lessen the defense industrial base’s reliance on adversaries such as China for supplies needed to build everything from bullets to nuclear weapons to night vision goggles.
The Senate’s annual defense authorization bill would authorize $1 billion in funding for the National Defense Stockpile in fiscal 2023 to “acquire strategic and critical minerals currently in shortfall,” per a summary of the legislation.
The fund is currently valued at $888 million, down from $42 billion in today’s dollars at its peak during the beginning of the Cold War in 1952. Lawmakers fear the National Defense Stockpile will become insolvent by FY25, absent congressional action, and are prioritizing shoring up the fund in this year’s defense appropriations and authorization cycle.
The $1 billion the Senate seeks to allocate would cover this while backfilling multiple funding requests the National Defense Stockpile has made in previous fiscal years and providing greater financial security in the years ahead.
The Washington Post reports that Lego plans to invest more than $1 billion over the next decade to build a factory near Richmond, Virginia.
The 1.7 million-square-foot factory, which is expected to open in 2025, will feature a carbon-neutral design and will employ more than 1,760 people.
The Danish toy manufacturer, a family-owned company founded in 1932 in Denmark, closed its first U.S. factory in northern Connecticut in 2006 and moved the production to Mexico.
The company would be eligible for a performance grant of $56 million if it reaches the promised levels of investment and employment, and the state will support site improvements worth up to $19 million, Youngkin’s office said.
“We are looking forward to making LEGO bricks in the US, one of our largest markets,” chief executive Niels B. Christiansen said in the news release. “The location in Virginia allows us to build a solar park which supports our sustainability ambitions and provides easy links to country-wide transportation networks. We are also looking forward to creating fantastic employment opportunities for the people of Virginia.”
The Reshoring Initiative issued a new report saying, “Rising Risks from Offshoring Drive Reshoring to a New Record High.”
According to the report, 2021 was a stellar year for U.S. reshoring and FDI, with 260,000 jobs announced by more than 1800 companies. Manufacturers looked to fill supply chain gaps of essential products, especially semiconductors, EV batteries, pharmaceuticals, PPE and renewable energy, which propelled the most-recent surge.
The article goes on to quote our very own President Mitch Cahn, citing Unionwear’s YouTube video about the costs of offshoring and benefits of reshoring manufacturing. Quoting the article:
If he [Cahn] can reshore labor-intensive apparel, readers should be able to reshore their products – and Unionwear is a great place to buy Made-in-America caps and bags for employees, customers and giveaways at conferences and trade shows.
The article has a lot more great information. Have a look.
According to a press release from the White House, President Biden took executive action to spur domestic clean energy manufacturing. This includes authorizing the Defense Production Act to lower energy costs, strengthen our power grid, and create good-paying jobs.
Last year marked the largest deployment of solar, wind, and batteries in United States history, and our nation is now a magnet for investment in clean energy manufacturing.
The US is also now on track to triple domestic solar manufacturing capacity by 2024. The expansions to domestic solar manufacturing capacity will grow the current base capacity of 7.5 gigawatts by an additional 15 gigawatts. This would total 22.5 gigawatts by the end of 2024 – enough to enable more than 3.3 million homes to switch to clean solar energy each year.
He is also taking executive action to:
Authorize use of the Defense Production Act (DPA) to accelerate domestic production of clean energy technologies, including solar panel parts;
Put the full power of federal procurement to work spurring additional domestic solar manufacturing capacity by directing the development of master supply agreements, including “super preference” status; and
Create a 24-month bridge as domestic manufacturing rapidly scales up to ensure the reliable supply of components that U.S. solar deployers need to construct clean energy projects and an electric grid for the 21st century, while reinforcing the integrity of our trade laws and processes.
As China’s COVID-containment lockdowns stall goods en route to price-conscious U.S. consumers, New Jersey manufacturer Mitch Cahn is finding traces of gold in the snapped links of the global supply chain.
Eleven miles from Manhattan, business is surging at Cahn’s textile company, which boasts a 100% local supply chain.
“We manufacture everything from scratch right here in north Newark. We have been in business for 30 years, we now have about 155 workers, and we are hoping to hire another 25 immediately,” said Cahn, founder and president of Unionwear.
Voice of America (VOA) is the largest U.S. international broadcaster, providing news and information in more than 40 languages to an estimated weekly audience of more than 311 million people. VOA produces content for digital, television, and radio platforms. It is easily accessed via your mobile phone and on social media. It is also distributed by satellite, cable, FM and MW, and is carried on a network of more than 3,500 affiliate stations.
The SCM Talent Group recently wrote an article about the chip shortage and quoted our very own Mitch Cahn about the supply chain.
In essence, the article discusses how the chip shortage, due to supply chain disruptions, will probably impact our Christmas gifts for 2022, and will have rippling effects throughout the world.
Unfortunately, it also looks like these supply chain disruptions will resonate beyond 2022.
In fact, Unionwear’s Founder Mitch Cahn doesn’t believe the global supply chain will be stabilized until at least 2023. “People have always said that making things in America is cost prohibitive, but that’s just not the case. There are A LOT of hidden costs beyond just unit price.” Cahn goes on to cite costs like tariffs, product development costs, inventory level requirements, transportation and more as obstacles to affordable global supply chains, and argues for more reshoring of manufacturing. Only time will tell if this happens on a large scale.
Design News says that the way out of the current supply chain crisis is with reshoring manufacturing.
Global supply chain chaos continues to threaten nearly every American company in some capacity as consumers lose patience with product delays and low inventory.
As the U.S. grapples with the ongoing chaos, manufacturers and nonprofit organizations alike are pushing for reshoring to bring production back to the states and meet the needs of their customers.
Rosemary Coates, a leading voice in national reshoring conversation, has this to say:
The pandemic has had a significant impact on global supply chains. With factories closing and opening and then closing again, first in China and then in the rest of the world, shortages and inconsistent deliveries were felt across the globe. Production stopped at some factories due to a lack of parts. Airlines stopped carrying cargo and passengers from Asia. Container ships reduced their sailing schedules and ports of call. Huge swings in demand for products caused havoc for manufacturers. As consumers, we suffered shortages of everyday products such as toilet paper, disinfecting wipes, and toys for the holidays.
Reshoring of US manufacturing is poised to surge 38% year over year, according to the Reshoring Initiative. “If 2H2021 progresses at the same rate as 1H2021, reshoring and foreign direct investment (FDI) job announcements for 2021 are projected to be over 220,000 — 38% above an excellent 2020 and, by far, the highest yearly number recorded to date,” according to the organization’s website.
“We’ve seen an uptick in domestic companies wanting to reshore manufacturing over the last couple of years and anticipate a 10 to 15% increase in production in the next 12 months due to reshoring,” said Tammy Barras, President of Westec Plastics of Livermore, CA. “One company we’re working with currently has products running overseas, but they’ve recently decided to build molds and run production domestically. They have seen production delays and increased costs due to inflation and supply shortages overseas. Several customers have requested only domestic tooling to avoid the uncertainty of the current economic climate.”
“I’ve been in the plastics business for 28 years and the tide is changing,” said Jon Hubers, Sales and Operations Manager for Crescent Plastics in Evansville, IN. “The phone is ringing with customers wanting to source USA parts because of the headaches with long lead times and increased shipping costs from China. We have two major OEMs reshoring parts and have found their costs to be lower. These positive changes make me very optimistic about future business.”
Unionwear’s Youtube video, which helps educate ad specialty distributors on which industries buy USA made promo products, just hit 100,000 views! This is further proof that the supply chain crisis, general global chaos, and more Chinese lockdowns are shaking up the swag business and sparking real interest in made in America promotional products
Yahoo News reports that New York Sen. Kirsten Gillibrand introduced the pro-labor federal ‘‘Fashioning Accountability and Building Real Institutional Change (FABRIC) Act.’’
The bill tackles reshoring tax incentives, the piece-rate pay system, joint liability and more in one fell swoop.
Among the features in store, the bill would create a $40 million domestic garment manufacturing support program with incentives like a 30 percent tax credit for reshoring garment manufacturing as well as a handsome grant program included in the package.
The bill would extend protections under the Fair Labor Standards Act of 1938 to prohibit employers from paying employees in the garment industry by piece rate (guaranteeing minimum wage as the floor to build upon incentives) — a loophole Gov. Gavin Newsom closed in California by signing the Garment Worker Protection Act, or SB 62, into law last year after a crusade by the GWC.
In its current draft, manufacturers and contractors in the garment industry would also be required to register with the Department of Labor. Registration fees to the Labor Department will help stoke the revitalization of the domestic manufacturing landscape. Meanwhile, manufacturer information gathered will aid recordkeeping and transparency measures.
“The bill is quite simple. It just mandates a fair work environment and fair worker treatment, and it authorizes some resources to do this,” said Gillibrand. “The combination of that investment plus the fact that it’s asking for broader, better treatment of workers [is] a combination that has appeal, and so we’re going to ask for a vote between now and end of the year.”
It’s always a little surprising to see us in the news. ROI NJ recently named Unionwear president Mitch Cahn a top-100 manufacturing influencer in New Jersey.
To quote the posting:
Cahn started Unionwear in 1992 with six sewers and a contract to make baseball hats for Ralph Lauren. Now, the company is one of the largest private employers of Newark residents, is the leading manufacturer of union “Made in the USA” hats, bags and binders for the promotional, fashion and uniform markets. During the COVID-19 pandemic, Unionwear stepped forward and shifted production to manufacturing face masks for the frontline health care workers.
We proudly employ over 150 unionized manufacturers right here in Newark and are excited about the future. Thank you again ROI NJ for the distinction.
ASI Central reports that contract talks involving unionized West Coast port workers could lead to slowdowns or stoppages that ultimately delay inventory replenishment, exacerbating stock gaps.
Importers in the promotional products industry are concerned that antagonistic negotiations could cause slowdowns or work stoppages at the ports, which have already been plagued by backups in the rampant importing rush that’s occurred in the economic bounce-back from COVID-19.
Negotiations began this week between the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA). ILWU represents 22,000 dockworkers that labor at 29 West Coast ports, including the ports of Los Angeles and Long Beach, through which about 40% of cargo containers imported to the U.S. flow.
Teresa Fang, vice president of supply chain at alphabroder — the second-largest supplier in promo — told ASI Media that, should slowdowns or stoppages occur, importers will scramble to reroute shipments to other ports, such as those on the East Coast. That comes with potential challenges and complications.
“East Coast port congestion will then be something to watch for as everyone makes moves to mitigate the risks on the West Coast,” said Fang.
Why? According to Rosemary Coates, who was on the forefront of helping companies leave the US for Chinese manufacturing, put it bluntly. “You’ve taught the Chinese manufacturer how to manufacture your goods. You’ve sent them the blueprints. You’ve told them what the processes are. You’ve told them who all of your suppliers are across China. They’re not going to go to sleep at night, wake up in the morning and forget how to make your goods. They’re going to come to work in the morning and keep making your goods and put a different label on it.”
Now that companies are looking to reshore their manufacturing, they find themselves competing against their own items with different labels on them — for a lot less money.
So, it seems that the big push to manufacture overseas was not a great long-term strategy.
In any event, if you are looking to reshore your manufacturing, you might want to be mindful of this unintentional side-effect of cutting costs at any cost.
Scott Paul, president of the Alliance for American Manufacturing, recently interviewed Unionwear president Mitch Cahn on how having a unionized manufacturing facility in Newark, NJ gave him a strategic advantage for 30 years. Below is a quick summary of the podcast.
Getting started
Mitch got his start in 1992 when he started manufacturing hats to fashion brands as well as hemp-made hats – both of which were basically non-existent at the time. Once manufacturing largely went offshore by the mid-1990s, Unionwear started selling products mainly to unions. Then in 2000, the Al Gore for President campaign ordered hundreds of thousands of hats which revolutionized the company. The headcount peaked at 175 before the pandemic and now has around 160 people, making hats, bags and other items for the federal government as well as private companies selling made in America products.
Newark’s manufacturing history
Mitch went on to say that he is a proud fifth-generation Newark-area resident whose family-owned large businesses in the late-19th century in the area. Upon doing research, he learned that there were hundreds of manufacturers in Newark, and he led the charge in highlighting the role that manufacturing continues to play in the city. Given Newark’s location near one of the largest ports in the US and direct access to New York City, Unionwear probably could not operate as it does today if it moved to a lower-cost, more rural area of the country.
Surviving the Great Resignation
One of the biggest advantages Unionwear has been that they haven’t had to bid-up wages to retain staff during the current talent crunch. They were already paying good wages and benefits, so they did not need to raise prices to compensate. And, they have worked closely with the union literally from the very beginning. Thanks to their close partnership, the union has provided referrals to other unions, contract opportunities, and much more. In certain circumstances, it is actually cheaper to buy union-made American goods compared to China, especially when it comes to custom, small-batch orders.
Now, Unionwear is investing heavily in business process automation to reduce the need for more labor during this labor shortage, which will make Unionwear a much more competitive and efficient manufacturer if, and when, the supply chains return to normal. This automation will likely not result in job losses. In fact, as the automation takes hold, Unionwear will likely repurpose current staff into different positions. For example, instead of spending years training someone to get to the top of their sewing ability, Unionwear will be investing in machines to automate those processes and, again, move those employees into more interesting positions in the company.
Even with the labor shortage, Unionwear is well-positioned to bring in top talent. As a union shop, Unionwear offers 20 days of paid time off (PTO), good health benefits, and of course highly competitive wages. Unionwear also has very low turnover – that’s because the longer someone stays, the more benefits they will receive, including an increase in wages over time.
Pivoting during the pandemic
When the pandemic hit, nearly all of Unionwear’s work stopped, and ended up nearly going out of business. After speaking with the head of the union, the team quickly pivoted to making PPE – face shields and washable gowns – for front-line healthcare workers who were coming to work wrapped in trash bags. Since we had most of the raw materials available and were located right in the shadow of New York City, Unionwear was making and distributing PPE to frontline healthcare workers fairly quickly. One important lesson: our team can make just about any item, quickly. It gave our team a lot of confidence to take risks which will help operate more efficiently.
Advice for future manufacturers
When asked if he has any advice on starting a business, Mitch said they should read “The Lean Startup” first. Then, he recommends they plan to lose money at first and find a subcontractor to manufacture at first, then simultaneously build their manufacturing, peeling some manufacturing away to their own facility bit-by-bit, so you can grow without the pain of paying payroll. He would also recommend connecting with their local Manufacturing Extension Program (MEP.) It helps to not figure things out on their own.
Finally, it is exciting for Mitch to see how people frequently wear Unionwear’s hats. In fact, nearly every Democratic and Republican presidential convention is filled with people wearing Unionwear hats. It is very gratifying to know we are making a real impact while providing good-paying jobs here in New Jersey.
Note: an earlier version of this post incorrectly said the president of the Alliance for American Manufacturing’s name was Scott Hall. The correct name is Scott Paul, and the post has been changed to reflect this. We regret the error.
Thomas explains that large companies, including General Motors, Lockheed, Micron, Intel, and more are reversing the offshoring trend and bringing manufacturing jobs back to the USA.
Although the supply chain crisis has driven home the need to reshore manufacturing, other factors are also involved. Many companies have realized that keeping processes closer to home can be much more reliable and secure.
General Motors, for example, will be investing $7 billion to build four electric vehicle (EV) manufacturing facilities in Michigan. The decision to build a new battery factory, convert an existing factory to focus on electric pick-ups, and upgrade two vehicle assembly plants, will create 4,000 jobs in Michigan, where GM was founded.
GM views this as a key tenet of their overall strategy, given that they have the largest EV portfolio of any automaker. The investment includes forging stronger links with reliable suppliers to ensure a more resilient and North American-focused supply chain.
Not only that, but there are also foreign-direct investments (FDI) coming in as well. Toyota is investing $1.29 billion into a battery factory in North Carolina, which should create 1,750 new jobs, and initially produce enough lithium-ion batteries for 800,000 EVs and hybrid vehicles a year, with plans to expand to up to 1.2 million.
Since the earliest days of COVID, China has practiced a zero-tolerance policy to prevent COVID from spreading.
After the initial onslaught of cases around Wuhan and pockets throughout China, the government declared victory and boasted about its superior method of containment compared to Western democracies.
This approach made sense in the earliest days, when we didn’t understand the risks of the virus and there was a general lack of understanding of how it virus spread.
Now, two years later and billions of doses of vaccines in arms have allowed Western countries to open back up. Indeed, additional draconian lockdowns seem impractical and an overreach.
China still hasn’t changed its approach, however. They recently locked down two of its three largest cities: Shanghai, a global financial center, and Guangzhou, a massive manufacturing and distribution city. Shanghai’s port is the largest in the world, and Guangzhou is the fourth-largest. Combined, the two cities alone handle nearly three times the amount of cargo that the entire U.S. imports each year.
Chinese lockdowns, furthermore, are not like Western lockdowns. Not leaving the house means not leaving the house. There are reports that if you become sick, you suffer without medical care, no matter how dire your condition is.
Basically, Chinese people are held prisoners in their own homes. If you leave, you are subject to arrest and egregious penalties.
Shanghai’s lockdowns began on April 2, and Guangzhou’s began on April 11. According to a report in Reuters, at least 373 million people – who contribute 40% of China’s GDP – have been affected.
This has obviously crippled China’s supply chain, not to mention the rest of the world. Container volumes out of Chinese ports began to drop on April 6th and as of April 15th, have declined by more than 31%. This will have a ripple effect which will impact not just China, but also the rest of the world, possibly forever.
Mitch joins other New Jersey awardees, including Governor Phil Murphy, Sen. Cory Booker, the CEOs of Campbell Foods and NJ Transit, just to name a few.
“If it’s got to be Made in America, there’s a good chance it was made in Newark. That’s where Cahn‘s company Unionwear is based. The manufacturer makes uniforms, hats and other promotional clothing, serving as the go-to source for political candidates who cannot be caught wearing or hawking anything marked Made in Some Other Country. Like many, Unionwear saw higher-than-average turnover during the past year, dropping its employee count down to 155. But, Cahn said the company is aiming to get to 180 employees by May. While local partners work to build manufacturing capacity here in New Jersey, a measure making its way through Congress could lend support to the industry at large. Following the breakdown of supply chains over the past year, Cahn – who also serves on the New Jersey Manufacturing Extension Program’s board of directors – explained the proposal could help to move certain manufacturers out of the shadows. “It is easy to find products,” he told NJBIZ this month. “It is next to impossible to find capabilities. When there is a national emergency and the federal government needs supplies immediately, there is currently no way to locate who has the capability and capacity to fill gaps in critical infrastructure.”
Congratulations again to Mitch and all the awardees!
DW reports that companies have indeed been reshoring and are starting to view our previous offshoring initiatives with a bit of confusion.
Thanks to the coronavirus and other unexpected challenges, especially the resulting (and ongoing) supply chain crisis, have sparked lots of unexpected issues, including inflation. As a result, more and more firms are cutting their costs and reshoring production to the US. As early as 2019, when the trade spat between China and the US was in full swing, American firms sought to decrease their dependence on the Asian market.
According to industry organization Reshoring Initiative, some 1,800 US firms are intending to reshore parts, or their entire, businesses this year. Some 220,000 new jobs are to be created in the US this way. Over a decade ago, only 6,000 new jobs were created in the country as a result of reshoring activities.
For instance, in March of this year, Intel announced it would pump some $20 billion into two new semiconductor plants in Arizona. General Motors is reshoring its battery production to Michigan where a new hub for lithium-based products will soon emerge. As steel prices have skyrocketed, producer US Steel has decided not to build its new $3 billion factory abroad, but rather in Alabama or Arkansas. Reshoring activities are also being considered by Lockheed, General Electric and ThermoFisher Scientific.
Still, more needs to be done. Reshoring expert Harry Moser thinks the US administration needs to step up to make this transition viable. “Our manufacturing costs are about 15% higher than Germany’s and 40% higher than China’s,” said Moser who headed a medium-sized engineering company for 22 years.
A study from Kearney, a global management consulting firm, shows that large portions of offshored manufacturing may soon be returning thanks to companies combining their nearshoring production to Mexico, Central America, and even Canada, with manufacturing and assembly in the United States.
According to Kearney’s ninth annual reshoring index, a unique barometer for tracking the extent to which America is reshoring manufacturing back from low-cost countries, US imports of manufacturing goods from the tracked countries totaled 14.49 percent of US domestic gross manufacturing output, up from 12.95 percent in 2020.
Instead of simply reshoring every manufacturing facility to the USA, Kearney takes a look at “nearshoring” manufacturing, where certain aspects of manufacturing are set up closer to the US.
Redefined, reshoring is likely to catch on faster in some industries than it does in others. “We are seeing a significantly increased focus from apparel and footwear companies on finding reshoring and nearshoring opportunities as a way to both mitigate supply chain disruptions and increase sustainability,” said Brian Ehrig, partner, apparel sector lead, and consumer practice sustainability lead.
Pet Business reports that, somewhat unsurprisingly, customers are prioritizing pet food that is made in the USA. While this has been popular for some time, they report that since 2020, the call from consumers for these products across industries has skyrocketed.
The inspiration for domestic manufacturing isn’t entirely based on a desire to make a better product. Some view made in USA as a strategic advantage, according to Elena Kalogeropoulos, chief executive officer at Chasing Our Tails.
“I would like to see people talk about, not only things that are Made in the USA, but a great differentiator—if your manufacturer can share with you—is finding out what states we are celebrating,” Kalogeropoulos explains. “It might be a handshake between the Carolinas and Florida or Texas and Colorado. What would be a great thing is if we could celebrate our states. It could give brick and mortars a little bit of a push if they find out who in their store is from their area.”
That company views American manufacturing as an opportunity to remain transparent, allowing consumers to trace the source of their products.
One big reason for the increase in demand for Made in USA has been the supply chain challenges since the COVID-19 pandemic. While conditions at ports around the U.S. have improved over 2021, the backlog has created enormous delays and caused costs to skyrocket.
In January 2022, Tom Brady — arguably the greatest quarterback of all time who retired for about six minutes — announced his Made in America BRADY collection. As the line suggests, everything made under this banner is manufactured in the USA. This latest lineup includes a mix of sweatshirts, shorts, T-shirts and more in four colorways and seven styles.
Brady said the following on his Instagram account about the new clothing line:
We’re very proud to release our Made In America collection…which you guessed it…is all made in the USA. Did I make it all myself with the sewing machine in the laundry room? Maybe…who’s to say?
All items from the new collection are available exclusively on the company’s website.
Supply Chain Brain provides an in-depth look at what it will take for manufacturing to return to the USA. Turns out, reshoring manufacturing to made in America will not be easy. At all.
Dan Varroney, founder of Potomac Core Consulting and author of Reimagining Industry Growth: Partnership Strategies in an Era of Uncertainty, says “It’s a question minus a strategy.” Varroney urges adoption of a long-term strategic view, involving industry trade associations as “neutral ground,” by which companies can identify “pre-competitive” challenges and determine the best path forward for their supply chains.
More specifically, Varroney argues that businesses should join with their trade associations to identify parts of the country that might provide fertile ground for manufacturing operations, then work to develop and promote local education systems so as to generate a supply of trained and skilled workers needed to staff the factories.
KTVQ in Montana reports that the US Department of Agriculture (USDA) will make available a $250 million grant program to support independent, innovative and sustainable American fertilizer production to supply American farmers.
Additionally, to address growing competition concerns in the agricultural supply chain, USDA will launch a public inquiry seeking information regarding seeds and agricultural inputs, fertilizer, and retail markets.
The price of fertilizer has more than doubled since the same time in 2021.
The United States is a major importer of, and is deeply dependent on, foreign fertilizer. In fact, the US is the second or third top importer for each of the three major components of fertilizer. The top producers of the major components of fertilizer include China, Russia, Canada and Morocco, with Belarus also providing a significant share of potash.
The new program will support fertilizer production that is:
– Independent – outside the dominant fertilizer suppliers, increasing competition in a concentrated market.
– Made in America – produced in the United States by domestic companies, creating good-paying jobs at home and reducing the reliance on potentially unstable or inconsistent foreign supplies.
– Innovative – improve upon fertilizer production methods to jump-start the next generation of fertilizers.
– Sustainable – reduces the greenhouse gas impact of transportation, production, and use through renewable energy sources, feedstocks, formulations, and incentivizing greater precision in fertilizer use.
– Farmer-focused – like other Commodity Credit Corporation investments, a driving factor will be providing support and opportunities for U.S. agriculture commodity producers.
As the supply chain continues to be in chaos, individuals and organizations — especially in the promotional products industry whose shipments are not arriving on time, if at all — are looking to buy made in USA products. In addition to not being stuck at a port in Los Angeles, made in America is likely more sustainable environmentally, and of course it creates jobs right in your community. Also, contrary to popular belief, buying made in USA is not necessarily more expensive.
Even though it can be difficult to find items that are exclusively made in USA, it’s not impossible. Here are a few ways for you to get started.
1. Search Amazon. By doing a simple search for products made in America or, similarly, made in USA, you can begin looking for items manufactured domestically. The search might not be 100% accurate though, so be sure to research items before buying.
3. Search for lists. There are countless resources on the web on buying made in America. One quick Google search came up with this result.
4. Read the labels. When shopping, be sure to read the labels on items that say made in USA. Look for made in USA whenever possible. If all else fails, ask.
Buying domestically is good for your community, the environment, and frequently for your wallet as well. Let us know if you have any sources that you prefer.
ABC reports that younger workers are giving labor unions reason for hope.
The percentage of workers ages 25-34 who are union members rose from 8.8% to 9.4% between 2019 and 2021, or around 68,000 workers, according to the federal Bureau of Labor Statistics.
In fact, workers in their 20s —— and even in their teens —— are leading unionization efforts in a wide variety of companies, including Starbucks, REI, cannabis dispensaries, and even Alphabet, the parent company of Google. In fact, the Alphabet Workers Union, formed in 2021 and representing 800 Google employees, is run by five people who are under 35.
One main reason for this is that young people have seen a lot of economic hardships. They lived through the great recession of 2009 and the pandemic, and economic insecurity is a very real fear.
On this episode, Mitch explains how lean methodologies has aided Unionwear, describing how they have been so successful, despite producing in one of the most expensive locations in the world.
Without lean principles, it would be difficult for Unionwear to stay competitive with over 150 unionized employees in the shadow of New York City. However, he’s managed to do it.
According to Forbes, America’s supply chains are facing many challenges. One bright spot in the report, however, is fiber optic manufacturing.
The Departments of Commerce (DOC) and Homeland Security (DHS just released the report “Assessment of the Critical Supply Chains Supporting the U.S. Information and Communications Technology Industry,” part of a larger Biden Administration effort on critical supply chains.
The report describes many sobering challenges for the US in the production and manufacture of information communications technologies (ICT). High end ICT products are less likely to be made in USA, a key problem for strategic technologies like semiconductors for which domestic manufacture has declined from 37 percent of the world’s total to just 12 percent in the last 30 years. Moreover, the US share of global electronics manufacturing has decreased from 30 percent to 5 percent in the last 25 years, creating critical cyber-risk.
However, US-made fiber optic production remains a bright spot, mainly because US manufacturing of broadband is subsidized and assisted by the government. There remain risks, mainly from China, who could flood the market with their fiber optic equipment, causing prices to drop quickly.
Still, this means the US government can, and should, step up helping domestic companies boost their manufacturing in every sector, not just fiber optics.
The Alliance for American Manufacturing reports that President Biden is working to shore up the domestic supply chain. To that end, the Biden Administration announced a $35 million investment in a California-based rare earth facility, with the aim of creating a fully domestic supply chain for the magnets that power vehicle motors, wind turbines and more.
Just about everyone knows that the US is facing serious supply chain disruptions. But that doesn’t just mean items stocked at the store. It also involves rare earth materials which we use to manufacture a wide range of items. Indeed, the bulk of America’s supply of these critical minerals is imported. China produces around 90% of the world’s supply of rare earth elements.
That’s not all the administration is doing. The Department of Interior also announced a new interagency working group that will focus on reforming mining laws, regulations and permitting policies “to promote the sustainable and responsible production of critical minerals.”
Venture Beat reports a little disconcerting: 90% of U.S. semiconductor-grade neon comes from Ukraine which, as of this writing, is being invaded by Russia. Naturally, this is putting additional pressure on the supply chain that is already strained.
According to the article, the Semiconductor Industry Association (SIA) said “the semiconductor industry has a diverse set of key materials and gases, so we do not believe there are immediate supply disruption risks related to Russia and Ukraine.” Nevertheless, the long-term impact of the conflict remains unclear.
Demand for chips that specialize in artificial intelligence for machine learning training and inference is predicted to grow at over 50% annually across all computing categories, while the U.S. government has warned that the global chip supply chain remains weak. Among many other things, Russia’s invasion of Ukraine is likely to make it more difficult to acquire raw materials to make these chips.
To reduce risks in the future, the House of Representatives put forward its version of the U.S. Innovation and Competition Act (USICA) with $52 billion in domestic semiconductor funding. Let’s hope it’s enough.
The Biden-Harris administration recently announced new actions across agencies to support American leadership on clean manufacturing—including low-carbon production of the steel and aluminum we need for electric vehicles, wind turbines, and solar panels, and the clean concrete we need to upgrade our transportation infrastructure.
Among other items, the administration announced the following:
$8 billion for Regional Clean Hydrogen Hubs that will create jobs to expand use of clean hydrogen in the industrial sector and beyond
$1 billion for a Clean Hydrogen Electrolysis Program to reduce costs of hydrogen produced from clean electricity
$500 million for Clean Hydrogen Manufacturing and Recycling Initiatives to support equipment manufacturing and strong domestic supply chains
The Council on Environmental Quality and White House Office of Domestic Climate Policy are establishing the first-ever Buy Clean Task Force, which will harness the federal government’s massive purchasing power to support low-carbon materials made in American factories.
The General Services Administration and the Department of Transportation are also announcing new efforts to promote use of low-carbon materials in construction projects funded by the Bipartisan Infrastructure Law, and the State Department and U.S. Special Presidential Envoy for Climate are securing corporate purchasing commitments for low-carbon materials and technologies through the First Movers Coalition.
The Administration is advancing carbon-based trade policies to reward American manufacturers of clean steel and aluminum. Working with the European Union, the Administration is taking steps to align global trade with climate goals, which will keep out dirty products and result in more jobs and lower prices for Americans.
The Council on Environmental Quality is issuing new guidance on responsible deployment of Carbon Capture, Utilization, and Sequestration (CCUS) technologies that can reduce emissions from heavy industry and help us achieve a net-zero economy. This guidance will support CCUS projects that create union jobs and protect communities from cumulative pollution impacts. Actions by agencies will incorporate environmental justice considerations across CCUS activities.
We applaud the administration’s stance on bringing sustainable manufacturing back to the US. There’s a lot more. Have a look here.
But trade channels have become so clogged up it could be well into next year before the worst-hit industries see business remotely as usual, even assuming that a new turn in the pandemic doesn’t create fresh havoc.
Kellogg CEO Steve Cahillane told Reuters, “I wouldn’t think that until 2024, there’ll be any kind of return to a normal environment because it has been so dramatically dislocated.”
In a statement, the company said the uniforms are a “modern and fresh take on sportswear,” created with sustainability in mind. With the help of a company called Skyscrape, the outfitter added intelligent insulation.
According to the company, the outfits are comprised of a mid-layer jacket, pant, gloves and boot. All of the garment pieces are made in the United States and include recycled polyester fiber made with post-consumer plastic bottles.
Furthermore, Ralph Lauren said the apparel to has the ability to transition through three-seasons, and from indoor to outdoor environments.
Team USA’s opening ceremony uniforms in Beijing for the 2022 Olympics will be assembled and manufactured by Better Team USA, designed by Ralph Lauren.
NJ Governor Phil Murphy said, “I am proud that when fans of the Games across the world tune into the Opening Ceremonies of the 2022 Games, they will be seeing Team USA athletes outfitted in Ralph Lauren parkas manufactured right here in New Jersey by Better Team USA.”
However, there is a great deal of controversy regarding China’s use of forced labor in the Xinjian province. In fact, the Biden Administration will not be sending an official U.S. delegation to the 2022 Winter Olympics.
White House press secretary Jen Psaki cited “the PRC’s ongoing genocide and crimes against humanity in Xinjiang and other human rights abuses.”
Everyone knows that America’s supply chains are in crisis. Nearly every business that has relied on imports has been impacted since the pandemic snarled everything to a halt. We have been speaking about it for a while as well.
One company notably got it right, and they are benefitting from their supply chain resiliency.
Because of this, Apple is now valued at some $3 trillion, a number unheard of just a few years ago.
A chain is only as strong as its weakest link. And when it comes to the current state of supply chains, “weakness is evident everywhere,” says Per Hong, partner with Kearney.
Prior to Omicron, there had been signs that some supply chain bottlenecks were beginning to clear up. But the new variant has presented global supply chains with yet another test of resilience.
The problems with ocean shipping, including soaring freight rates and tight capacity, are likely to persist into 2023. Much depends on the Chinese government, which as of the new year had placed thousands of citizens under quarantine due to the Omicron outbreak. Further, they are discouraging travel during the lunar new year break in February, when millions of Chinese travel home to celebrate with family.
Hong believes the pandemic will trigger some permanent changes in the design and execution of global supply chains, including a greater reliance on buffer stock and a shift in sourcing patterns away from China. We would add that reshoring manufacturing to the US will become a new, more permanent feature of our supply chain.
Ohio Senator Sherrod Brown (D) notes that he and fellow Ohio Sen. Rob Portman (R) have urged passage of bipartisan legislation on reshoring jobs back from overseas, investing in manufacturing and cracking down on unfair trade practices.
The Intel project has been described as at least the biggest economic development deal for Ohio since Honda built its 4 million square foot manufacturing plant near Marysville in the early 1980s.
Yahoo! News is reporting that thousands of boxes are littering Union Pacific’s train tracks in downtown Los Angeles. These boxes, largely due to a wave of recent thefts, are creating endless delays for consumers and merchants that likely cost millions, if not more.
Thieves have been raiding cargo containers, taking packages that belong to people from all over the country from retailers like Amazon, Target, Macy’s, Skechers, and others, leading to viral images on social media.
Bayard Winthrop, American Giant’s CEO, says it’s not as hard as you might think to manufacture in America.
Since he launched the brand a decade ago, he’s been building out a local supply chain, using American factories and sourcing locally materials whenever possible.
In the midst of the pandemic, when most brands were scrambling to stay afloat, American Giant launched a new product category—high-performance outerwear—which required finding new factories and suppliers who could make them from start to finish.
While many fashion executives anxiously waited to see if their collections would arrive in time for the holidays, American Giant shipped products from factories to customers quickly. This domestic supply chain is part of the reason the brand grew revenue upwards of 30% each year of the past two years, while many fashion brands struggled. Some, like Ann Taylor, Brooks Brothers, and J.Crew, went bankrupt.
C-NET has been running a regular series on what it means to be Made in USA. In this article, they take a trip to a massive Clean Room, run by government contracting powerhouse Lockheed Martin, where Lockheed is building a new kind of satellite.
It’s called the GOES-T, a massive weather satellite for the National Oceanic and Atmospheric Administration (NOAA) and NASA. The satellite will enter geostationary orbit, about 22,000 miles above Earth’s surface. It will collect huge amounts of data about weather here on Earth and in space.
Set to launch in February 2022, the satellite will track meteorological events in precise detail, mapping lightning strikes, following fire lines and tracking extreme weather in real time. All this data beamed down from space could potentially be life-saving, helping scientists and meteorologists better predict natural disasters and protect all of us here on the ground.
GOES-T also can track solar flares, changes in the magnetosphere and radiation hazards, all of which can affect not only the planet’s weather, but also electronics and communications equipment on Earth and in the International Space Station. In fact, one of the tasks of the GOES satellites is to provide warnings to astronauts on the ISS about incoming solar activity that could affect their operations or interfere with their instruments.
Five years ago, The Purple Aardvark opened on Main Street in Chatham, NJ. From day one, their goal was simple: sell only made in America items. At first, they were focused on selling locally-made items, but later they expanded to other states as well.
According to the Chatham Patch, owners Carolyn Cherry and Sandy Casey said, “We went out and found local artisans for that first year… eventually we branched out a little more finding talent from other states as well.”
The pandemic created challenges for them, but also opportunities. “Our amazing customers continued to shop with us virtually and then we did work to get our webstore up and running as well.”
Also, their orders aren’t stuck on a cargo ship due to the ongoing supply chain crisis.
So, if you are in the area (or even if you aren’t) and are looking for locally-made gifts, check out their website
The Sourcing Journal reports that Lucky Brand recently tapped two U.S. suppliers to develop a limited-edition line of men’s jeans that will launch in Summer 2022.
The Made in USA jeans feature selvedge denim produced by Louisiana-based Vidalia Mills that is then sewn and laundered in California at Artistic Milliners-owned Star Fades International (SFI).
SFI, which launched at the end of 2020, aims to establish a new model for both Los Angeles-based denim production and U.S.-based manufacturing capabilities.
SFI provides turnkey and custom wash and finishing services to a customer roster that ranges from large international retailers to specialty premium labels, and its in-house design studio already has two capsule collections under its belt.
Tamara Reynolds, vice president of design, denim, said Lucky Brand’s last Made in America jean debuted in 2018, and it’s looking forward to continuing that part of its history.
Lucky Brand’s Made in American collection will include the men’s 410 athletic straight, 223 straight and 363 vintage straight fits. The 401 and 363 jeans will be available in sizes 28-42; sizes 29-40 will be available for the 223 style. Jeans will retail for $199.
There is a common misconception that made in USA is dead. As we have seen, especially since the beginning of Covid and our supply chain broke down, that is far from the case.
Indeed, made in America manufacturing is going to become a strategic and tactical advantage for companies who learn to embrace it.
One of the biggest obstacles to reshoring manufacturing is cost. But, when you factor in all the hidden costs of offshoring manufacturing to China and other countries and add in the marketing power of made in America, domestic manufacturing makes a lot of sense. Some items, especially those produced in small quantities, are actually more affordable when made in America.
In addition to labor unions and politicians, there are three major buyers of made in America manufacturing:
An organization that cares about fair trade, sweatshop-free, a living wage, buy local, union and American-made
Anyone who is promoting themselves as made in USA is buying US-made promotional goods themselves
Anyone who is looking for a small number of goods delivered quickly
Additionally, if you are looking to get Federal business, you need to have domestic manufacturers.
Manufacturing in America is not out-of-touch. It’s a tactical advantage in this changing landscape. It’s time we start embracing made in USA manufacturing, not as a novelty, but as a necessity.
A great Made in America story: KRTV in Great Falls, MT reports that a teenaged farmer in Montana launched a handbag that is Made in USA from locally-sourced farming materials.
“My handbag is made out of American cowhide leather which also starts on a farm,” 17-year old Kate Stephens said. “This handbag is made from the highest quality materials I could possibly find and constructed very well. I find it’s very important to have the highest quality product at a great price point.”
In addition to making handbags, she also has a successful YouTube channel which educates consumers about where their food and clothing come from.
“I first started driving combine when I was 15 years old and I had such an awesome experience that I wanted to share with everyone I met and let them know about how their food gets to their table,” said Stephens. “I realized that not many people know where their food comes from.”
An article in Offshorewind.biz says that the US Infrastructure Investment and Jobs Act, signed into law by President Joe Biden on November 15th, will spur the creation of a US offshore wind industry, said David Hardy, CEO of Ørsted Offshore North America.
The Bipartisan Infrastructure Deal represents the most significant long-term investments in American infrastructure and global competitiveness in nearly a century, according to the White House.
The law also prioritizes increasing the competitiveness of the US economy, including through implementing the Act’s Made-in-America requirements and bolstering domestic manufacturing and manufacturing supply chains.
“Congress joined a bipartisan level of support in the Senate which had passed this act twice earlier this year. Now, all federally procured PPE will have strong domestic content and production standards, which creates a stable market for responsible companies to serve, creating good jobs making safe products for frontline workers,” said Workers United International President Lynne Fox.
Among other things, the bill shores up domestic infrastructure to make more PPE in the USA. It provides at least 2 years to incentivize investment in the production of PPE and the materials and component manufacturing
Workers United leadership worked with Senator Kirsten Gillibrand (D-NY), Senate Majority Leader Charles Schumer (D-NY), Senator Gary Peters (D-MI), Senator Rob Portman (R-OH) and Congressman Bill Pascrell (D-NJ) throughout this process and is grateful for their leadership in this effort
Whether it’s sourcing raw materials or manufacturing and selling products, by some estimates, about 60% of the world’s fashion industry passes through China in some form. So when they China starts facing scheduled and extended power outages, the fashion industry will feel the pinch.
These power shortages are impacting more than half the country. Not only have raw material prices (both in China and globally) soared since the onset of the pandemic, but sourcing materials such as cotton from China’s western Xinjiang region have become increasingly fraught for global brands, as countries such as the US have banned them due to allegations of forced labour.
The blackouts are largely due to a nationwide push to diversify China’s economy away from coal. Combined with flooding in major mining regions, and to a lesser extent a trade conflict with Australia, China’s thermal coal prices have risen to record highs, over 200 percent this year. And, a government mandate prevented power companies from passing increased cost on to customers, leading to the rolling blackouts.
Compounding everything else that’s happening in the world, the fashion industry needs to learn to adapt, quickly, to keep their industry afloat for the time being.
U.S. Sens. Bill Cassidy (R-LA) and Maggie Hassan (D-NH) unveiled the bipartisan Strengthening America’s Strategic National Stockpile Act of 2021, S. 1974, which would amend the Public Health Service Act to improve the SNS. U.S. Rep. Elissa Slotkin (D-MI) on May 28 introduced the companion bill, H.R. 3635, in her chamber with 15 original cosponsors.
“COVID-19 showed the danger of our nation’s dependence on China and other foreign countries for life-saving supplies,” Sen. Cassidy said. “We need to strengthen the Strategic National Stockpile by producing these supplies at home which creates jobs and bolsters our independence.”
“We can never again let our country be dependent on foreign suppliers for the equipment we need when crises like this pandemic strike,” said Rep. Slotkin.
The measure would call for improved maintenance of the SNS to ensure stockpiled items are in good working order; provide more federal resources to states to expand or maintain their own strategic stockpiles of medical supplies; and bring transparency to stockpile allocations by requiring a report to Congress on all requests for stockpile supplies during the pandemic and the response to each request, according to a bill summary provided by the lawmakers.
As part of providing states with more resources, the bill would require the HHS Secretary to establish a pilot grant program for states to expand or maintain a strategic stockpile of commercially available drugs, devices, PPE, and other products that a state deems “essential in the event of a public health emergency,” according to the bill’s text.
Increasing or contracting emergency stock of critical medical supplies;
Geographically diversifying domestic production of such medical supplies;
Entering into cooperative agreements or partnerships regarding manufacturing lines, facilities and equipment to domestically produce such medical supplies; and
Managing — either directly or through cooperative agreements with manufacturers and distributors — domestic reserves by refreshing and replenishing the stockpile of such medical supplies, according to the text of the bill.
The bill also would establish and maintain the domestic reserves of critical medical supplies, including PPE, ancillary medical supplies and other supplies required to administer drugs, vaccines and biological products, as well as diagnostic tests, according to the bill’s text.
Business Insider found yet another, unexpected problem with the global supply chain bottlenecks: a lack of packing materials.
Low containerboard and corrugated cardboard inventory has been a mounting issue since earlier this year, according to the article, thanks to growth in e-commerce during the lockdown.
Retailers like Amazon began stockpiling cardboard in January 2021 to meet demand, leaving smaller businesses empty-handed.
By February, cardboard prices reached a record high, according to the Producer Price Index and the US Bureau of Labor Statistics.
Additionally, International Paper, one of the largest providers of containerboard and corrugated cardboard in the US, told investors in July 2021 that supply of cardboard boxes was “severely low,” and warned of continued supply chain bottlenecks leading into the rest of the year.
According to Forbes, the key to a healthy economic resurgence is not paying people sweatshop wages. In fact, good wages and strong labor laws, like California’s Senate Bill 62, the Garment Worker Protection Act, which is currently on Governor Gavin Newsom’s desk, awaiting his signature, will signal the return of Made in America.
As of right now, California garment workers paid through a piece rate system, where they’re paid pennies per garment sewn. In practice, this means factory workers are frequently paid well-below the minimum wage. SB62 will require factories to meet the minimum wage, and can use the piece rate as a productivity bonus if they wish.
Trade groups for large manufacturers say that the only way to keep labor in the USA is by saying factory workers below the poverty level. Rick Helfenbein, retired chairman of the American Apparel and Footwear Association, a trade association that includes brands like Gap, Under Armour, and Levi’s, says raising California’s garment workers wages to the state minimum would put California’s “46,000 entry level garment jobs at risk.”
In fact, cheap prices are not driving reshoring. “It’s their increased focus on speed to market, innovation, and sustainability,” according to Christian Birky, founder of Because Capital, a new firm set up to buy American manufacturing facilities and improve their social and environmental impact.
Unionwear has been paying union-wages in one of the most expensive labor markets in the US and has survived for some 30 years. If we can do it, anyone can, especially given the move toward made in USA in recent years.
Yahoo News reports that supply chain issues are impacting all sized businesses and it will certainly disrupt the holiday shopping season. We recommend you start your holiday shopping now to make sure your gifts get here in time, otherwise your Christmas tree might look empty this year.
According to Adam Compain, senior vice president at project44, a supply chain technology provider, there are three main factors driving the supply chain disruption.
“First and foremost is customer expectations have risen only in one direction — and that’s up,” explained Compain. “Second to that is a capacity constraint. There are limitations to the supply chain network in terms of the quantity of drivers that are available to ship things within the United States and abroad.” Third, the process of turning raw materials into a finished good and bringing it to a consumer’s home across the globe relies on “a whole bunch of interdependencies,” and “logistics has reached a point that the existing software data and tools to make that job a reality are really strained.”
In other words, We are in for a rough ride for the foreseeable future. Hopefully this will further drive manufacturing back to the USA.
The Reshoring Initiative recently published a report predicting that reshoring and foreign direct investment (FDI) job announcements for 2021 are projected to be 38% above an excellent 2020. This will be, by far, the highest yearly number recorded to date.
The projection of jobs chips, EV batteries, PPE, pharmaceuticals, and rare earths – the essential products that the Biden administration has focused on – represent 62,500 jobs. Without these products, there would be 157,500 jobs.
While some of the essential products would have come back without the Biden push, it is reasonable to state that the administration’s initiatives have driven some of the increase.
The report concludes that the underlying problem — domestic manufacturing costs are about 15% higher than Germany’s and 40% higher than China’s – needs to be dealt with. If we do not address this underlying problem, we cannot manufacture enough electronic products and EVs to absorb our subsidized chips and batteries.
Covid-19 has wreaked havoc on the promotional products industry and the problem won’t automatically resolve itself. The New York Times reports that factories in Vietnam, a major apparel and footwear supplier to the US, have closed or operate at reduced capacity, complicating the all-important holiday season due to the pandemic.
In recent years, Vietnam has grown to become the second-biggest supplier of apparel and footwear to the United States after China. Retailers relocated their manufacturing to the country from China due to rising costs and new tariffs on China instituted under former President Donald J. Trump. While Vietnam made it through the early part of the pandemic relatively unscathed, the Delta variant taking its toll, showing the perils that new outbreaks pose to the world’s economy.
Many American retailers are anticipating delays and shortages of goods as we approach the holiday season. Nike cut its sales forecast, citing the loss of 10 weeks of production in Vietnam since mid-July and reopenings set to start in phases in October.
Union Made In USA
