Factory Closing: Why Is Anyone Shocked? This Was Coming…

The last couple of weeks has been an absolute flurry of reports and posts on the factory closings in the south, and I am a bit surprised by the coverage.

It has been linked to snow, labor shortages, to the RMB effect on trade, and a move to new low costs bases, and so on… and what makes me laugh a bit is that this is something that could not only be seen coming from a long way off, but where I think many reports are actually off is that they have failed to take into account a MAJOR cause of these closures.

These businesses were losers to begin with, they were being propped up by an inefficiency, and they would have closed in short order anyway.

(more…)

ShareThis