Dr. Chris Kuehl says reshoring hit $1 trillion last year. Chinese factory workers now earn $45,000 annually, up from $5,000 a decade ago. As wages rise globally, the just-in-time supply model that built globalization breaks down.
We saw $1 trillion worth of reshoring last year. We'll probably see a similar amount this year. And the seeds of globalization's decline were planted in the very beginning because globalization, the whole just-in-time thing, worked as long as you had societies that were able to maintain very low production costs. But as you get more successful, as China has become, those costs go up. At one point you could hire a skilled machinist in China. This is like 10, 15 years ago, and they would be paying them around $5,000 a year. That same machinist is now $45,000 a year, still cheaper than here, but a lot more expensive than it used to be. You used to have lots and lots of suppliers. So if you were counting on just-in-time, something happened to Supplier A, you shifted to Supplier B.
