One by one, we are losing our greatest industries in the United States, and all the high-paying jobs that go with them. The latest is the pharmaceutical industry, of which many of those companies are putting their production facilities, and some of their research centers in China as well. Some large Big Pharma corporations are going to India instead, but either way they are leaving the USA. Yes, they are also consolidating and laying off here as well. But, lately so many of them have been off shoring those jobs.
It’s really amazing considering the United States government has propped up the big pharmaceutical industry for so long, and our taxpayers dollars pay for huge numbers of drugs for senior citizens to take – to help them through various diseases, and ailments. Many seniors are taking over 5 different drugs, and it’s costing a huge amount of money. But rather than that money being used to provide jobs here in the United States, the pharmaceutical companies are finding less regulation and cheaper labor in China F95zone
From a CFO’s standpoint, or shareholder equity standpoint, yes, this makes perfectly good sense, however, we here in the United States should be careful because without the same regulations in these production facilities there, those facilities that make the drugs – well, let’s just say there “will be problems” with quality control. There have been a number of very big cases outside the Boston area and in New Jersey, and a couple in Philadelphia area where some major large notable companies did not have the quality control necessary to make sure the drugs were safe – well, at least according to the FDA, a number of facilities have been fined.
In China there is basically little quality control outside of the company’s themselves, and the United States FDA only has one office in China and I believe they haven’t visited the big pharmaceutical manufacturing operations there to check on these obvious suspicions. Nevertheless, these drugs come back for human consumption here in the United States. I believe that to be unacceptable [opinion]..
Should we blame all this on free trade? No, perhaps not, but we should understand how trade works. Remember the glass industry which was doing quite well in the southern states, well after NAFTA it all went to Monterey Mexico, later when labor increased in price there, it all went to China. It’s amazing all those glass products can be shipped from China to here without breaking, but that’s how it works.
Eventually the same thing will happen in China as it did in Monterrey Mexico, and those Big Pharma jobs will leave China for other places such as Egypt, Africa, Indonesia, or India where labor is cheaper, that is as the Chinese Employees demand higher labor wages, and their currency rises to match the true inflation and expansion of their economy.
In fact, not long ago, I read a very interesting research paper on this which prompted me to write this article. The abstract of the paper and its conclusion was that China will lose its competitiveness in the pharmaceutical manufacturing industry by around 2015 to India. This makes perfectly good sense to me, but in the meantime we must watch the quality control of those products, and we have a severe problem with the loss of jobs here in the US, and they are not coming back in this industry.