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Will manufacturing jobs return to the U.S.?

For decades, it's been assumed that the U.S., Britain, Japan and other industrialized countries were also-rans in the global manufacturing race, losing business, and millions of outsourced jobs, to lower wage rivals in Asia, Eastern Europe and Latin America.

But a new study by the Boston Consulting Group suggests there have been "dramatic shifts" in recent years in the economics of manufacturing. Changes in wages, productivity, supply-chain issues, energy costs, currency values and other aspects of manufacturing have significantly undermined emerging economies' competitive advantage.

Perhaps the biggest sign of this change: As China has modernized, its estimated advantage in manufacturing costs over the U.S. has declined to a less than five percent. Last year, the U.S. Bureau of Labor Statistics noted that utility costs in China had risen 15 percent between 2010 and 2011. The cost of land used for industrial purposes in the People's Republic also has skyrocketed, especially compared to similar real estate in the U.S.

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In Brazil, another emerging economic powerhouse, manufacturing "is now estimated to be more expensive than much of Western Europe," Boston Consulting noted, adding that the competitive gap between Poland, the Czech Republic and Russia and developed economies is also closing.

Many major industries are shifting their manufacturing to reflect these changing dynamics. The U.K. has become one of the lowest-cost auto manufacturing regions in Western Europe, with a number of multinational automakers expanding their production in Britain. Earlier this year, for example, Jaguar Land Rover, a division of India-based Tata Motors (TTM), announced a U.S. $74.7 million modernization investment at its facility in Halewood in northwestern England. The British automotive industry is projecting it will produce over 2 million cars annually by 2017, which would top the industry's all-time record of 1.9 million vehicles set in 1972.

Even some of the largest Asian electronics manufacturers, like Taiwan-based Foxconn, a major contractor for Apple (AAPL), has been looking to shift production to North America.

"Many companies are beginning to see the world in a new light," Harold Sirkin, a senior partner with Boston Consulting and the report's co-author, said in a statement.

"They are finding that many old perceptions of low-cost and high-cost countries are out of date, and they are starting to realign their global sourcing and production networks accordingly."

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