Corporate Executive Survey Commentary: Labor Costs No Longer Paramount
The cost of labor can sometimes be replaced by increased automation, but employees with a higher skill level are still needed.
Q1 2014
Highway accessibility, logistics, and transportation costs are also a critical factor. As fuel costs rise, companies are thinking ahead to where their customer base will be located (either consumer or other companies) and how best to position a manufacturing or distribution facility so it will continue to be located central to customers and not outside a logical delivery route.
The movement of the labor costs factor from first to third in the rankings is a reflection of a tight labor market. The immediate concern is finding a skilled work force; the cost of labor can sometimes be replaced by increased automation. As robotics becomes less expensive, we are finding companies looking for additional ways to automate, thus reducing the number of overall employees, but still needing employees with a higher skill level.
We were surprised by the drop in the ranking of energy costs from 6th in 2012 to 10th in 2013. Many manufacturing companies will increasingly demand lower energy costs to compete and reshore production from overseas. We continue to hear that maintaining low-cost energy is paramount for our client’s ongoing success.
The available buildings factor did move from a ranking of 8th in 2012 to 6th in the 2013 survey. This is due to a dwindling supply of quality existing facilities. As the real estate market tightens, this factor could rise in the rankings for 2014.
Project Announcements
Kimberly-Clark Expands Aiken County, South Carolina, Distribution Operations
05/04/2025
Aerowerks Plans Gaffney, South Carolina, Manufacturing Operations
05/04/2025
Sweden-Based Troax Group Plans Portland, Tennessee, Manufacturing Operations
05/04/2025
Kimberly-Clark Corporation Plans Warren, Ohio, Manufacturing Operations
05/04/2025
Denmark-Based Novonesis Expands Salem, Virginia, Production Operations
05/04/2025
Polyvlies USA Expands Winston-Salem, North Carolina, Manufacturing Operations
05/04/2025
Most Read
-
Run a Job Task Analysis
Q4 2024
-
39th Annual Corporate & 21st Annual Consultants Surveys: What Business Leaders and Consultants Are Saying About Site Selection
Q1 2025
-
The Location Economics of Advanced Nuclear
Q1 2025
-
Why Workforce Readiness Can’t Wait
Q1 2025
-
Power, Policy, and Site Selection in 2025
Q1 2025
-
Is It Time to Start Planning for Quantum Data Centers?
Q1 2025
-
Top States for Doing Business in 2024: A Continued Legacy of Excellence
Q3 2024