Job Announcements -- Idle Chatter -- January 17, 2017

One has to ask the question: what's driving all the new jobs coming back to American; all the new jobs that have been announced since November 8, 2016?

I don't think it's as much about Trump as folks think. The "velocity" of these announcements would have never happened under a Hillary presidency, of course, but something suggests that there is more going on than simply a Trump presidency. Many of these deals had been in the work long before Trump was elected, and prior to the election, it was generally accepted that Obama would have a third term (Hillary).

So, I think other things are going on.

These are the "things" I think driving the renewed interest in manufacturing / bringing jobs back to the United States.

Top tier:

1. Without question, it is now acknowledged that the US will have inexpensive, predictable, and dependable energy for decades. In addition, many US corporations have learned how to take advantage of tax credits by investing in renewable energy.

2. The US advantage in energy would have been enough for much of this to happen, but the frosting on the cake: the expansion of the Panama Canal. This moves LNG to Asia, but more importantly, it opens up the US East Coast ports if the US West Coast ports go on strike which they seem to do. Even if they don't go on strike, we now have a bit competition between East Coast and West Coast.

3. Robots: will offset the costs associated with moves back to the US. That "border-tax" driving up costs on clothes? Fantasy. Robots now able to sew clothes.

4. Brexit: this is a tough one. I'm not sure it's even a player, and if it is, even less sure it's in the "top tier." But -- London has always been the global financial capital; NYC, #2. With the threat of Brexit, one wonders if that changes. Whether it does or not, access to capital is not a bad thing.

Middle tier:

1. Intellectual property: patent protection.

2. American workers: well trained, educated; even high school graduates are often over-qualified for some of these jobs; flexible; eager to work in many cases.

3. Locality: transportation costs come way down. The recent international ruling on fuel oil used by cargo ships was a huge change, and will add significant costs of global shipping.

4. Locality: iPhones can be flown in from China; Buicks cannot. Americans are getting used to two-hour delivery times. Manufacturers being closer to their consumers is not all bad.

Bottom tier:

1. Incredible pressure from the White House if US corporations don't invest in the US. It's all about social media.

2. The Trump initiatives. Prior to November 8, 2016, none of these initiatives were even considered a possibility. It is unlikely they are making a huge difference "all of a sudden." But as the Trump initiatives are added, they will move up to the second tier, and if corporate taxes are lowered / corporate tax policy is changed significantly, this will definitely move up to first tier.

3. Heathcare: US corporations have finally adjusted to most costly health care program they have seen. Even if it doesn't change, they at least have seen the worst. It cannot get much worse. But, with Trump in office, it's very possible their healthcare costs will come down.