More than four years ago, CoreNet Global accurately predicted in its forward looking report, Corporate Real Estate 2020, that a manufacturing rebound was beginning in the U.S.
This week, no less a powerhouse than, CBS’ 60 Minutes reported on that rebound, and used a CoreNet Global member, Joe Max Higgins of the Mississippi Golden Triangle’s GTRLINK, to tell the story.
“U.S. manufacturing is showing signs of coming back, due to cheap energy, proximity to customers and rising cost of labor in China. Nearly a million manufacturing jobs have been created since the great recession,” CBS’ Bill Whitaker said in the report.
The report focused on how Higgins has been effective in creating jobs in the state by working with major manufacturers including Steel Dynamics, truck maker Paccar and Airbus Helicopters.
It’s all part of a larger story that CoreNet Global saw coming.
In a survey conducted in conjunction with the Corporate Real Estate 2020 (CRE 2020) research in 2012, 51 percent of corporate real estate asset managers had either agreed or strongly agreed that there would be a rebound in domestic manufacturing from offshore locations.
This recovery would be driven both by companies bringing manufacturing plants and jobs back to the U.S. or choosing not to off-shore in the first place, according to the report.
“On-shoring in the U.S. will continue to gain steam due to changing global cost and supply chain dynamics,” said Dennis Donovan, principal with WDG Consulting, a national expert on site location decision-making and participant in the CRE 2020 research at the time. “The U.S. and its manufacturing base is more competitive than at anytime in a generation.”
“The labor cost arbitrage will likely diminish as a primary strategic driver as urbanization and industrialization trends in developing nations run their course,” Chris Horblit, President of Fidelity Real Estate Company, and a member of the CRE 2020 research team, said in the research report. “This, combined with ongoing security and quality concerns, as well as rising costs to transport goods and people, may well spark a marked turn to (on-shoring) by 2020.”
And it’s also one more reason why participating in CoreNet Global’s research teams and surveys are important; continue to look to CoreNet Global for prescient CRE analysis.