This comes from an article posted by Josh Bays of Site Selection Group

Exploring trends related to increasing costs of labor for manufacturing operations, Josh Bays, of Site Selection Group, recently published an article examining how such growing expense could encourage new manufacturers to locate in smaller communities. 

Taking common project specifications for manufacturing operations, the Site Selection Group conducted a 10-year operating analysis that estimated the average costs (includes: wages, salaries, benefits, real estate, utilities, training, and taxes) associated with population sizes using tiers. The tiers represented these population sizes:

• Tier 1: 1,000,000+
• Tier 2: 500,000 – 999,999
• Tier 3: 250,000 – 499,999
• Tier 4: 100,000 – 249,999

The results of this analysis indicated that investment in smaller communities versus metro areas could save manufacturers up to 10% in operating costs over a 10-year period. 

In addition to the benefit of lower operating costs, Bays suggests that smaller communities will continue to become more attractive to manufacturers if they are capable of offering aggressive economic incentive packages. Bays identifies manufacturers that entered smaller communities, looking at investments that occurred in New York and Minnesota to illustrate how these types of companies are gravitating more and more to less populated areas. 

Bays ultimately concludes that smaller communities will have the best opportunities to attract manufacturing companies if beyond lower operating costs and incentives, they can distinguish themselves by providing an attractive labor market, highlighting the importance of workforce development 

To read Bays full article, please refer to the link just below:

Cost Advantages of Manufacturing in Smaller Communities