2015 A.T. Kearney U.S. Reshoring Index reveals false start

January 20, 2016 - 06:00pm

U.S. manufacturing reshoring trends appear to have been short-lived, according to a Dec. 21 news release from A.T. Kearney, a global management consulting firm headquartered in Chicago.

"The reshoring phenomenon appears to have been more a one-off aberration than an inexorable trend," the firm reported, citing new data from its second annual A.T. Kearney U.S. Reshoring Index. "Data from 2015 confirms that offshoring is gathering steam, while the reshoring train has yet to leave the station."

Reshoring Initiative offers rebuttal to A.T. Kearney reshoring analysis.

The new A.T. Kearney U.S. Reshoring Index indicates a precipitous drop to –115, which the firm attributed to "lackluster domestic manufacturing growth and the resilience of the offshore manufacturing sector."

To calculate the index, A.T. Kearney collects data on the import of manufactured goods from 14 offshore trading partners in Asia: China, Taiwan, Malaysia, India, Vietnam, Thailand, Indonesia, Singapore, the Philippines, Bangladesh, Pakistan, Hong Kong, Sri Lanka and Cambodia. Next, the firm gathers data on the U.S. domestic gross output of manufactured goods. A.T. Kearney uses the data to calculate a manufacturing-import ratio.

The final index number is the year-over-year change in the manufacturing-import ratio, expressed in basis points. A positive number indicates net reshoring, while a negative value indicates net offshoring, the firm explained.