As the global economic downturn grinds on, more companies are
acknowledging that Labour costs aren’t always the most important
factor when deciding where to build their next factory.  This
column argues that, in times of recession, some companies find
that bringing their business home can give them a competitive
edge.  While politicians argue strategies to create jobs in the
faltering global economy, the debate around offshoring has
intensified.  Once considered a clear competitive advantage in
the fast-changing global market, manufacturers rushed to replace
domestic labor forces with lower-cost workers in emerging
markets.  By 2002–03, about a quarter to half of the
manufacturing companies in Western Europe were involved in
offshore production (Dachs et al 2006). And by 2008, more than
50% of US companies had a corporate offshoring strategy (Minter
2009).  Recently, though, many of the perceived offshoring
advantages have been called into question. First, the sourcing
costs from emerging economies have been