Manufacturing is squeezed by cost pressures that don't affect most other business sectors. In this global economy, big cost increases in any local or regional commodity, like chemicals, can make it difficult to manufacture profitably from a U.S. base because global manufacturing competition makes it nearly impossible to pass those cost increases on to customers. For large companies this problem can be solved to its shareholders' satisfaction by moving production offshore or at least sourcing from offshore suppliers. For smaller companies this may not be so easy. For U.S. manufacturing as a sector of the economy, the implications could be serious: lost jobs, lost domestic production capacity, lost competitiveness.
Source: AMR Research, http://amrresearch.com
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