Do we (or someone better informed) understand the impact of re-shoring ?
In my mind, the reason (or the original intent) for off-shoring was to reduce costs to be able to sell more X (because cheaper is easier to sell) and selling more X means more profit and better market capitalisation (if the company selling X was public)
If re-shoring is adopted, my assumption/understanding is that X will retail at a higher price. Oversimplification maybe, but higher retail price means lower sales means lower profit (means lower stock price if the company selling X was public)
The solution to that would be higher/more automation i.e. less (or minimal) manufacturing related jobs I think ?
And now the situation would be that while there was capital-return-to-shore happening but went into automation and the jobs recovery was not what someone would have expected (both in terms of scale and skill)
But because the jobs were virtually re-shored the off shore labour market now suffers ?
In my mind, the reason (or the original intent) for off-shoring was to reduce costs to be able to sell more X (because cheaper is easier to sell) and selling more X means more profit and better market capitalisation (if the company selling X was public)
If re-shoring is adopted, my assumption/understanding is that X will retail at a higher price. Oversimplification maybe, but higher retail price means lower sales means lower profit (means lower stock price if the company selling X was public)
The solution to that would be higher/more automation i.e. less (or minimal) manufacturing related jobs I think ?
And now the situation would be that while there was capital-return-to-shore happening but went into automation and the jobs recovery was not what someone would have expected (both in terms of scale and skill)
But because the jobs were virtually re-shored the off shore labour market now suffers ?
Thoughts... ?