There’s no doubt that the “creative destruction” associated with a free-market economy can produce hardships for those whose businesses fall by the wayside, and it’s often difficult to identify immediate tangible benefits associated with that destruction.
That’s why a Bloomberg Businessweek article about the new Nike Flyknit is worth highlighting.
The computer-controlled weaving technology, which knits the entire upper part of the shoe in a single piece that’s then attached to the sole, promises to cut labor costs and production time while also increasing profit margins and opportunities for personalization. It may even bring some shoe manufacturing jobs back to the U.S. In traditional shoemaking, machines cut scores of pieces that workers must then assemble. By reducing or removing that step, the most labor-intensive part of the process is eliminated—along with the main reason for making shoes in Asia’s cheaper labor markets. “This is a complete game-changer,” says Charlie Denson, president of the Nike brand. The process cuts costs so much “that eventually we could make these shoes anywhere in the world.”