Hat brand Kangol returns jobs to U.S. but is struggling "When the famous hat brand worn by celebrities like Samuel L. Jackson, Brad Pitt and Gwen Stefani moved into a Pennsylvania factory last year from China, executives with the Bollman Hat Co. billed it as an effort to create U.S. manufacturing jobs. But as labor costs went up, profits went down. Way down. The 149-year-old company behind Kangol says it's losing money on every kangaroo-logo cap knitted at its factory in Adamstown, 60 miles west of Philadelphia. * * * Employment is down 85 per cent since 1990 - the biggest decline of any manufacturing sector - as cost-cutting apparel companies shifted production to Asia in search of cheaper labor. Bollman spends about $11 an hour per worker in Pennsylvania vs. $2.60 in China." More below. Is $11 per hour really the "good manufacturing jobs" the American workers is looking for? I don't think so. The reason these jobs left, is we are unwilling to waste money on a knit cap, so we shop hard if we want to buy one, and buy the cheapest product of reasonable quality. As more and more manufacturers compete in this environment, US labor prices cannot compete, not even at $11 per hour.
The Fight for $15 crowd does not understand this, nor do those like Hillary Clinton, Bernie Sanders, or President Trump who support increased tariffs, and additional costs on imported items. Perhaps we should do what we do best, and manufacture more high quality products, and let the Chinese, the Vietnamese, the Turks, and others make low value hats, shirts, shoes, and the rest. Soon many of these things will return to US manufacturing as automation continues to improve, but until that happens, let these other countries manufacture, and assemble these low value products. "'Obviously, if you have a plant in the United States, it's much easier to respond to trends, produce small runs and get product to market really quickly,' said Nate Herman, the trade group's senior vice president of supply chain. Last year, for the first time in decades, the number of manufacturing jobs created by U.S. companies that moved operations back to the nation and by foreign companies investing in America exceeded the number of jobs lost by companies moving overseas, according to the Reshoring Initiative, a nonprofit set up to bring factory jobs back to the United States." While it is easier to respond to trends, and get product to market quickly if you manufacture in the US, if you lose money on each item, it is a bit daft to believe you can make up the loss in volume. This falls under the "if wishes were horses beggars would ride," exception to reality, I suppose. Reshoring Initiative be damned, the jobs will return to the US when, and only when automation allows the products to be manufactured, and assembled here at or below the costs of the foreign supplier. As Bollman Hat Co. has found, if you can't sell at at profit, you are taking a loss. And the US consumer will not buy over priced hats for the sole reason that they were made in the US. For companies these issues can be difficult. For government they are not. Government should always do what is in the best interest of the consumer, period. That is the best interest of the nation as a whole. It can do this by simply making tariffs, or other import restrictions unConstitutional. We should do this.
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