Question/Comment: I felt so encouraged by talk of Rust Belt life improving and of the death of U.S. manufacturing being greatly exaggerated! I am a textile designer and I wonder if you feel there is a chance of any such rejuvenation of the American textile industry, or is it too late and gone forever to China, Korea, India and Pakistan?
Paul Solman: I suppose that 1) as “unskilled” labor costs become a smaller and smaller portion of the cost of making textiles, and 2) if the dollar continues to decline, and 3) if transportation costs continue to rise (thus making a shorter supply chain ever more important), then the American textile industry becomes more competitive.
But when I was in residence at Franklin & Marshall College two years ago, I met a local (Lancaster, Pa.) sock manufacturer who produced abroad who told me labor was only a third or so of the cost of making socks, and yet the labor cost differences were decisive. The numbers he gave: labor that cost $10 an hour in the U.S. would cost $1.50 in China (after adjusting for quality differences) and less than 50 cents in Ghana and Pakistan. That’s a lot of margin for other factors to make up.