For instance, Generac Power Systems moved to China in 2001, wiping out 400 jobs in Wisconsin. They did this because Chinese companies were offering to make the company's product for $100 less per unit than the cost of making it in America.
However, Generac is now moving back to America, creating about 80 jobs, as are many companies. (Kids: guess reasons why they may be moving back to America)
Reasons for this include (1) Chinese labor and transportation costs have increased while U.S. equivalents have not; (2) manufacturing is being done more and more by computers, therefore decreasing labor costs; (3) gas prices have gone up in China but lowered in the U.S., due to new U.S. drilling techniques, which have lowered gas prices in the U.S.; (4) many U.S. consumers complain about the quality of goods made in China -- almost everything needs to be reinspected in America if it comes from China because of quality concerns: (5) the rise in online shopping has increased the need for U.S.-based supply plants.
In sum: prices of things from China are going up, quality is dropping, and deliveries are delayed. So companies are returning back to America. Kids: which is of these reasons do you think is the most important and why?
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