There are sectors in which the US presents lack of competitivenesseither due to high costs, low productive efficiency, or because other countries have taken the lead with more efficient and sustainable strategies.
The manufacturing industry, between high costs and relocation
Traditional manufacturing is one of the sectors where the United States has notably lost competitiveness. In the postwar decades, the US was the undisputed leader in manufacturing.n global industrial. However, with the rise of globalization and the offshoring of production to countries with cheaper labor, such as China, India and Mexico, the sector has seen a large decline in its global share.
According to the Bureau of Labor Statistics (BLS)labor costs in the US far exceed those in Asia and Latin America. For example, while the average manufacturing salary in the US is around 25 dollars per hourin China this same cost is reduced to 5 dollars. The ability to produce goods at lower costs has allowed other nations to dominate the global market for products such as textiles, household appliances and technological components.
In 2023, The United States represented only the 16% of global value added in manufacturingwhile China led with a 30%according to data from the World Bank. The competitive disadvantage is not only limited to labor costs, but also to the industrial infrastructure, which in many cases is obsolete compared to the automated megafactories that operate in Asia.
Agriculture and livestock, a giant with feet of clay
Although the United States continues to be a power in food production, it faces serious competitiveness problems in the traditional agriculture and livestock. High production costs, the depletion of natural resources and unsustainable practices have undermined its global leadership.
A report of the USDA (US Department of Agriculture) revealed that The average cost of producing a kilo of corn in the US is approximately $0.18while in Brazil and Argentina, the same product can be produced less than $0.12. This cost differential makes South American countries gain ground in international markets, especially in Asia.
On the other hand, American livestock farming also faces significant challenges. The report of FAO 2022 highlights that countries such as Australia and Brazil have established themselves as leaders in beef exports thanks to lower production costs and favorable weather conditions. In contrast, the U.S. livestock industry has to deal with rising livestock feed prices and increasingly strict environmental regulations, driving up its operating costs.
Rail transport, a relegated sector
As for the rail transportthe United States is lagging behind other developed economies. While countries like Japan, China, and several European nations have invested in modern, efficient rail systems, the U.S. has prioritized automobile and freight infrastructure.
According to a study by the International Railway Transport Association, high-speed network in China reaches 40,000 kilometerswhile in the United States there is no comparable high-speed network.Passenger service on trains like Amtrak is limited, slow and expensive compared to similar options in Europe and Asia. This affects not only the competitiveness of passenger transport, but also freight transport, where efficiency could considerably reduce internal logistics costs.
The lack of investment in railway modernization limits the US at a time when the world is betting on sustainable and energy-efficient means of transportation.
Renewable energies, lagging behind Europe and China
Although the United States is one of the largest energy producers, its competitiveness in renewable energies does not achieve global leadership. Europe and China have taken the lead in this sector thanks to public policies focused on the energy transition and massive investment in clean technologies.
According to the International Energy Agency (IEA), In 2022 China represented the 35% of global installed solar energy capacitywhile the United States contributed just one 11%. In wind energy, China and the European Union also surpass the US in installed capacity and growth rate.
The US lag is due, in part, to dependence on fossil fuels and the interests of the oil sector, which have often slowed the progress of the energy transition. Although the current administration has promoted initiatives such as Inflation Reduction Law to promote clean energies, the pace remains insufficient in the face of global competition.
Although the United States remains an economic power in many areas, it is not immune to the challenges of global competitiveness. The future of the US economy also depends on its ability to adapt and modernize these industries, but the question is, will it succeed? and at the cost of what?