Manufacturing jobs are slowly returning to the U.S., presenting an opportunity for small businesses, witnesses told the House Small Business Subcommittee on Economic Growth, Tax and Capital Access.
While the trend known as reshoring or onshoring started several years ago, it will continue as labor costs in China and fuel prices keep rising, said Shirley Mills, an analyst at The Boston Company Asset Management.
Cheap labor in China was a chief reason for the shift in manufacturing of clothing, consumer goods and other items away from the U.S. the past two decades. Labor was cheap enough to more than offset the price of fuel needed to ship goods to the U.S. But as labor and fuel get more expensive, more companies will have the incentive to make goods domestically, Mills told the subcommittee.
Besides manufacturers, transportation companies like truckers and raw materials producers will benefit, she said.
Reshoring brought 1,200 manufacturing jobs to South Carolina last year, Bobby Hitt, the state's secretary of commerce, told the subcommittee. Among them were an electronics company, a bicycle maker and a window furnishings manufacturer.
Small Business Lending
Citigroup made $9.1 billion in new loans to small businesses last year, surpassing its goal of $9 billion, the bank said in a statement. Citi also lent $26.6 billion from 2011-2013, surpassed the $24 billion in new loans it pledged as part of a Small Business Administration program to increase small business lending.
Citi, known more for being a banker to large and international companies, has said it's trying to increase its business with smaller companies. It runs behind other major banks in small business lending. JPMorgan Chase & Co. said it had $19 billion in new small business loans last year. Wells Fargo & Co. reported $18.9 billion, and Bank of America reported $11 billion.