Massachusetts Manufacturers Continue to Reshore Operations

The reshoring trend continues as Massachusetts manufacturers bring their operations back home. Companies, such as Energid Technologies Corp., are making the leap back to US soil to avoid external costs from unpredictable tariffs, foreign bureaucracy, and additional shipping charges. It seems the emerging economies of countries such as China and India have finally made outsourcing the less profitable option.

Energid is in good company among more than 350 US businesses that have chosen to reshore their operations. The influx has brought nearly 40,000 manufacturing jobs back to the United States over the course of the last five years. 3,000 of those jobs have returned to the Northeast, with 600 to Massachusetts, according to the Reshoring Initiative. While these new positions still represent a very small portion of the available manufacturing jobs in the US, expert economists say they are a very positive sign of the industry’s post-recession rebound.

Competitive production, automation and the complexity of today’s products have created a need for increased collaboration between designers, engineers, and production lines. Massachusetts remains a prime location for most manufacturing industries due to access to highly trained engineers and innovators from places like MIT. Despite this, there is still an observable labor shortage in the manufacturing industry as skilled workers are retiring with fewer young people coming in to take their place.

Manufacturing resources like MassMEP are exploring initiatives to increase the number of motivated and highly trained workers coming into the manufacturing industry. MassMEP is currently teaming up with UMass Lowell to deliver the Advanced Computer Numerical Control Training Program in Massachusetts, which would value and merit to the industry while encouraging young individuals to get their certification and consider a career in manufacturing.

Other resources are helping businesses overcome the initial expenses of re-locating their operations back to the US. MassDevelopment, a quasi-public industrial development agency, has helped several companies reshore operations with loans of up to, and in some cases exceeding, $1.5 million.

The Realities of Reshoring US Manufacturing

Offshoring—or outsourcing—is the practice of moving factories and jobs overseas. In the last 20 years, American companies have started sending manufacturing operations to countries with cheaper labor, fewer regulations, and more forgiving tax schedules. The phenomenon is familiar to anyone talking to tech-support in India, but it has also occurred in the manufacturing industry. Before 2000, US manufacturing grew almost as fast as the nation’s Gross Domestic Product (GDP) at ninety-four cents on the dollar, but since the turn of the millennium that number dropped to only 45%, until this year.  Currently, US manufacturing has grown faster than the GDP.

The reason for this is called reshoring—returning factories to US soil. Many companies are finding good reasons to move their operations back to America, and the result is higher domestic manufacturing rates, and in some markets, more general growth. Companies have returned to the US to: reduce the complexity of their management and supply chains, avoid the costs and delays of shipping, ensure quality control, and to take advantage of some lower energy costs.

Some corporations are not moving their existing operations, but instead opening new facilities. This geographic diversification insulates businesses against economic hardships like labor disputes, natural disasters, political upheaval, and more.

made in usa

Unfortunately, reshoring is not a marvel of American job-creation. Companies are choosing to move back stateside because it is the most economically feasible option. They are utilizing automation and optimization consultants to make their operations as lean as possible. The cost of healthcare and other benefits, coupled with government labor regulation, makes reshoring labor-intensive industries less likely to return. Those who do reshore have reported problems finding qualified employees, as too many applicants cannot pass drug screenings, do not have a grasp of basic math skills, or are unreliable.

Bill Conerly, an economics expert writing for Forbes, sums it up perfectly when he writes, “The fastest-growing parts of manufacturing will be those that use the least labor. Productivity in factories continues to improve, so the best jobs picture we can hope for is flat. The peak year for US manufacturing employment was 1979, and we’re not going back there.”

FLEXcon Gains Space-Age Flexibility in Spencer Business Market

FLEXcon, a family-owned business in Spencer, Massachusetts, has recently landed national attention with their new space-age business partnership. NASA’s Glenn Research Center has agreed to license the production of a special insulator to FLEXcon, a local business in Massachusetts. “We are delighted to secure a licensing agreement for Glenn’s technology,” said Glenn Research Center Director Jim Free, in a press release.

The special insulator is a significant improvement over other products. The material is a polyimide aerogel film that insulates against both heat and cold. The film, which is 500 times stronger than traditional silica aerogels, is currently patent-pending. FLEXcon’s license will allow the Massachusetts business to manufacture and market the film, as well as develop new applications for it.

FLEXcon won’t need to install any new equipment, as their existing  manufacturing equipment can be re-calibrated to create the new technology.

“We know how to take their invention and make it commercially feasible, … We’re excited about this. We’re proud of it. … This is a good win for FLEXcon.”

—Bill Sullivan, Vice President of Performance Products, FLEXcon

While the product was developed for use in space suits, it can also be used in a variety of every-day applications. The efficient, lightweight insulator can be used in household applications like refrigerators, dishwashers, and to insulate pipes. It can also be used in clothing.  Sullivan explained that, “You don’t want to put on a big parka when you’re climbing up Mt. Everest. You want to put on something that’s light but will give you good thermal energy.”

The polyimide aerogel also has applications in the medical industry as it can be used to insulate the containers used for organ transport and blood storage.

The ability to manufacture and distribute a brand-new bleeding-edge product can be a significant boon for the town of Spencer. The product will be a new sales item, which will increase corporate revenues for the local business. is There is potential for further deals with NASA. According to Free, “By licensing the polyimide aerogel technology to FLEXcon, Glenn will gain a commercialization partner.” This makes the implications of the business partnership exciting, because there may be future collaboration between the two companies.  Sullivan shared, “I think more good things are going to come through the relationship NASA has with FLEXcon.”

Massachusetts Contract Manufacturer Helps Urban Garden Get Off the Ground

At the heart of every great business, from two-man start-ups in the garage to Fortune 500 giants, is one common factor: a great idea. But for many start-ups, that great idea may be all they have. While small businesses provide the opportunity and flexibility for innovation, many of these organizations lack the resources to move beyond the prototype stages. Too many brilliant ideas have been waylaid by simple logistical errors that could be avoided through partnership with an established contract manufacturer—especially one that is well versed in the needs of small businesses.

It was at this crucial juncture, moving from prototype and proposal to market-ready production, that the environmentally-focused Massachusetts start-up Freight Farms stepped up to the plate and hit a home run. By partnering with an established manufacturer like Columbia Tech they were granted access to world class facilities and years of experience—something most small businesses only gain over years of trial and error.

Freight FarmsThe Freight Farms model is simple: a repurposed 40-ft freight container is converted into a self-contained, modular environment for growing fresh vegetables in any locale, regardless of climate or available resources. On paper this idea might even look easy, but the challenge the project developers faced was daunting. How would they build containers at a rate that satisfied demand and remained profitable? How would the ‘farm-in-a-box’ be transported to its final destination?

While the project founders knew these concerns existed, they were focused on the big picture of creating a sustainable food source that could eventually reduce or eliminate world hunger. An ambitious task, but with these intimidating goals in mind, they turned to Columbia Tech’s expert teams, who helped them standardize production at maximum efficiency. Utilizing a contract manufacturer helped Freight Farms sidestep the delays that accompany building a new production facility, allowing them to move rapidly from concept, to prototype, to market.  By selecting a partner that had a strong background in container-based manufacturing, the Freight Farms team could keep their focus on the product and rely on the experience of Columbia Tech to guide them through the sometimes arduous process of turning their great idea into reality.