Reflecting the structural change of manufacturers' shifting their production sites overseas, the contribution of income generated through outward direct investment and outward portfolio investment, which is the fruit of firms' outward investment, has tended to increase in Japan's current account (Chart 12).
In the U.S., notably, industries faced with declining competitiveness did not shift their production facilities offshore but instead underwent rational processes of adjustment involving mergers and acquisitions, shifts of specialization and closures. To my mind, deindustrialization or a shift to a focus on services, better describes this process in the U.S. than to refer to it as a “hollowing-out of manufacturing”.