Existing regulation and downstream pressures are not likely to reverse that trend for any part of the manufacturing sector, said IBISWorld analyst Jack Curran.
“We’re not seeing jobs move back in. The hope right now is to keep the jobs that are here from leaving,” he said.
A threat to national security?
As the value of the dollar goes up, so does the cost of products made in the U.S., Curran said. Those increases are factored into the purchasing patterns of large corporations, such as health care providers.
Texas Health Resources, an Arlington-based hospital chain, is a longtime buyer of of Prestige Ameritech products, purchasing more than 300,000 masks a year, each for “less than the price of a gumball,” according to Bowen.
But Texas Health’s chief financial officer, Mark Riordan, notes that the system must rely on a number of vendors to support the supply chain, including from companies that make them abroad. “The most important thing for us is to maintain the integrity of our supply chain,” Riordan said.
“It’s got to have the quality, the price and the availability.”
The difference in cost between a local and foreign-made surgical mask can amount to pennies on the dollar. “But when you’re talking about millions of units, it does add up,”said Robinson, who led BARDA from 2004 to 2016.
The potential downside is that access to imported supplies can be compromised during emergencies, when other nations work to secure the safety of their own citizens first. Too often that is when domestic companies get a major boost, Robinson explained.
That being said, local companies could also be compromised in a major event, added Timothy Bowers, a spokesman for the Association for Professionals in Infection Control and Epidemiology.
“If you’re relying on one stream of intake, then clearly that’s a huge risk if anything were to happen.”
Near bankruptcy after the boom
But small businesses may cease to exist as an option without a consistent revenue stream, worried Bowen, who most recently lost bids to supply his masks to the military and veteran’s hospitals.
Precept Medical Products, the North Carolina-based company that won the bid, did not respond to a request for comment. But the masks they create are made in Mexico, according to the Defense Logistics Agency.
The agency defended the decision. It boiled down to which company had the best product to meet the military’s needs and help them to be “good stewards of the taxpayers’ dollars.”
“This contract saves the military health care community more than $30,000 per year for surgical masks and more than $75,000 per year for procedural masks,” the statement said.
The agency said three companies, headquartered in the United States, put in bids.
Bowen admits his prices are higher, the trade-off he makes for staying local. But he says he’s not interested in being “backup guy” again.