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Deals & Dealmakers

Is manufacturing making a comeback in the United States?

The US manufacturing base could be making a comeback, according to fresh analysis from Cushman & Wakefield.

It its annual ranking of the 30 largest countries according to manufacturing output and operational risk (as defined by UNCTAD (United Nations Conference on Trade and Development). America jumped an impressive five places from 2014 to land at number four.

The productivity increase is being credited to a low-risk environment and stronger energy platform both in terms of security and cost.

Mark Wanic, Cushman & Wakefield’s head of occupier services in the Americas, said: “There is a genuine sense that manufacturing is now making a comeback in the US as global demand appears to have turned a corner. The cost differential to cheaper markets, which contributed to a number of manufacturers moving ‘off-shore’, has now narrowed –with the US regaining a competitive edge.

“A more competitive energy platform, both in terms of cost and security, is adding to the US as a manufacturing location. In addition, supply-chain management is also collectively adding to the more positive outlook evident from our latest index ranking.”

As customer expectations continue trending towards immediate and highly customized products, manufacturers face an ever-pressing need to amplify their adeptness while mitigating risks within manufacturing and supply chain operations.

Those best positioned to weather individual market conditions, risks and costs as part of any relocation or expansion strategy, while remaining nimble enough to meet the niche demand of global consumers, are at a distinct competitive advantage.

At 4th place, the US was the highest ranking country from the Americas is survey, with the least risk globally.

Canada is close behind in 6th place, with Mexico ranking 14th.
Mexico continues to absorb a significant proportion of U.S. export-oriented middle and high-end manufacturing, and is also benefitting from stronger demand for low-end manufacturing.

The top three ranking countries are all located within the APAC region — with Malaysia retaining the number one position; the dominance of the “APAC powerhouse” is underscored by the region securing seven places in the top 10.
The largest manufacturing country in the world, China, ranked number three globally.

Growth in manufacturing output made Singapore one of the top 30 for the first time, and this is nearly all driven by high-end science or tech-based manufacturing.
Turkey scored highest in the EMEA region at number eight.

The Russian Federation, at number 16, is the least expensive location in the index, with competitively low costs for registering property and electricity costs for heavy industrial usage.

Poland, United Kingdom and Netherlands ranked 12th, 15th and 17th, respectively.

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