News, Insights and Best Practices for Manufacturing in Mexico

Rise in US lean manufacturing may drive offshore manufacturing

30 Dec 2013

Category: Labor & Economics, Manufacturing in Mexico

The U.S. manufacturing sector took a hit during the recession, but the industry is making a comeback. While many companies are still struggling to regain the ground they lost due to the economic downturn, news source McClatchy DC reported adopting lean manufacturing principles is helping numerous manufacturers get back on their feet. Lean manufacturing practices can give companies a competitive advantage by allowing them to reduce manufacturing costs.

Yet these operational strategies may only get U.S. companies half-way to their profit goals. Producing products in the U.S. is more expensive than manufacturing in Mexico, and manufacturers are already having troubles finding skilled workers for their U.S. plants. Offshore manufacturing to Mexico is the logical next step for companies to remain competitive.

Lean manufacturing gaining ground in US
McClatchy reported investing in technology is helping American companies become lean, resulting in a rise in output despite employing fewer workers.

Daniel Meckstroth, chief economist for the Manufacturers Alliance for Productivity and Innovation, told McClatchy that while the manufacturing industry is recovering, it has a long way to go. 

"It's not like everything is great in manufacturing," Meckstroth said. "It's recovering. Demand is picking up. We're trying to get to recovery of the previous cyclical peak and get on a growth path. First you've got to recover from what you lost."

According to, lean manufacturing is one way for companies to optimize their efforts and productivity to become successful. Even if U.S. companies are able to implement numerous lean manufacturing principles, such as using quick identification tips, standardizing processes and investing in innovative technology, some manufacturers might find that high labor costs and expenses of producing goods in the U.S. don't outweigh the benefits. As more companies adopt lean manufacturing to recover from the economic downturn, many will turn their eyes toward Mexico for its low cost manufacturing environment.


Related posts