Made in California

International enterprises boost the state's economy

Alongside traffic and coffee, news radio is a staple of my morning commute. As I flip through the stations, I’ll sometimes hear a pundit lament that “Nothing is made in America anymore.”

In reality, there are nearly 13 million manufacturing workers in the United States, including thousands in California. Some of these folks are employed by U.S.-based firms. Many others work for companies headquartered abroad.

These international companies employ more than 769,000 Californians. That includes 199,900 employees in manufacturing jobs—or nearly 26 percent of all California jobs created by international companies.

According to the latest government data, the number of California jobs created by international companies jumped by 29 percent during the past five years. More than 1,980 different international companies employ California workers.

International firms pay better. Americans who work for global companies earn 26 percent more compensation than the average worker in the same geographic area, according to a new analysis from the National Bureau of Economic Research.

International companies benefit all workers, not just the ones they employ directly. When an international firm sets up a manufacturing plant and creates 1,000 new jobs in America, workers at domestic firms in that geographic area experience a collective $16 million boost in wages. So, for every local job created by an international firm, the wage pool for employees in the area increases to the tune of $16,000 annually.

International companies also benefit U.S. small businesses. Over the past one and a half decades, international companies increased the amount of business they do with U.S. suppliers by nearly 30 percent—jumping from $1.5 trillion to $2.4 trillion, after adjusting for inflation.

Sourcing locally is important for reasons beyond just economics—it allows U.S. small businesses to demonstrate a commitment to social equity and environmental sustainability.

As we celebrate local manufacturers statewide, let’s recognize how international companies catalyze local economic growth—giving a whole new meaning to “made in California.”

Nancy McLernon is the president and CEO of the Organization for International Investment. We welcome your contribution. To have your topical essay of 350 words considered for publication, write
[email protected].

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