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 A new ranking of the competitiveness of the world's top 25
exporting countries says the United States is once again a "rising
star" of global manufacturing thanks to falling domestic natural gas
prices, rising worker productivity and a lack of upward wage
pressure.
The report, released on Friday by the Boston Consulting Group (BCG,)
found that while China remains the world's No. 1 country in terms of
manufacturing competitiveness, its position is "under pressure" as a
result of rising labor and transportation costs and lagging
productivity growth.
The United States, meanwhile, which has lost nearly 7.5 million
industrial jobs since employment in the sector peaked in 1979 as
manufacturers shipped production to low-cost countries, is now No. 2
in terms of overall competitiveness, BCG said.
The biggest factor driving the U.S. rebound, according to BCG: cheap
natural gas prices, which have tumbled 50 percent over the last
decade as a result of the shale gas revolution.
Also contributing to the country's attractiveness, according to BCG,
is "stable wage growth" — a euphemism for the fact that, in
inflation-adjusted terms, industrial wages here are lower today than
they were in the 1960s even though worker productivity has doubled
over the same period of time.
"Overall costs in the U.S.," the report's authors write, "are 10 to
25 percent lower than those of the world's 10 leading
goods-exporting nations other than China" and on par with Eastern
Europe.
Another standout in the rankings is Mexico, which BCG categorizes as
a "rising star" with lower average manufacturing costs than China.
But the country failed to make BCG's list of Top 10 manufacturers
because of other factors, including rampant crime and corruption.
BCG arrived at the rankings using a proprietary index that focuses
on four major factors: wages, productivity growth, energy costs and
exchange rates.
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In addition to China, four other countries with reputations as
low-cost production centers — Brazil, the Czech Republic, Poland and
Russia — are classified as being "under pressure" in terms of their
manufacturing costs. Here is BCG's ranking of the world's Top 10
countries in terms of manufacturing competitiveness:
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China
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United States
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South Korea
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United Kingdom
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Japan
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Netherlands
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Germany
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Italy
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Belgium
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France
(Reporting by James B. Kelleher in Detroit;
editing by Nick Zieminski)
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