According to a study by the Economic Policy Institute, New Jersey has lost 78,800 manufacturing jobs since 2001, when China entered the World Trade Organization.
In total, the EPI reports 2.8 million manufacturing jobs — mainly in the computer and electronics industries — have left the United States in the last 10 years.
“We’ve certainly seen an impact,” said Robert Loderstedt, New Jersey Manufacturing Extension Program president. “It tends to be the things that are straightforward and relatively repetitive in large qualities.”
Loderstedt said the report was accurate in stating trade issues, such as currency manipulation, intellectual property theft, heavy industrial subsidies and Chinese state-owned enterprises, contribute to the growing job losses and trade deficits. But he said hope is on the horizon for New Jersey’s manufacturers as China becomes more developed, and companies can bolster their top lines through several processes now.
“The number-one thing is getting some manufacturers out of the mode of just wringing their hands … and start thinking of their business from the standpoint of taking out waste from their manufacturing process and their front-end process,” Loderstedt said. “There are a number of manufacturers that we’ve worked with that have been able to remain competitive, or more competitive than the Chinese, in part because of the uniqueness of the product they make and because they continued to drive to being a low cost provider.”
Loderstedt also said NJMEP will be rolling out a national exporting program in early 2012 to help New Jersey manufacturers prepare to export their goods. While exporting has many challenges and is front-end investment heavy, Loderstedt said if a company prepares well, exports can be an alternative to mergers and acquisitions for adding revenue.
“We can’t affect taxes in the state of New Jersey, we can’t affect regulation, but what we can do is work with various state agencies to use the principles of lean to speed up the amount of time it takes to get a permit from when it’s applied for, and when it’s received,” he said.
“If you continue to look at the kinds of things that are occurring in China, it’s just a function of time before they will move away from being a country that is exporting at the level they are to a country that is manufacturing for their own population,” he added. “A lot of things are happening in that regard — inflation is starting to heat up in China, which puts them at a competitive advantage. You’ve got increased education, you’ve got access to information, you’ve got a growing middle class — all of those things, as they start to move closer to a developing nation, will shrink the significant difference in labor savings you see in China versus in the U.S.”
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