Ashley Furniture Co. earned big headlines in 2012 when it announced plans to invest $80 million in a North Carolina manufacturing and distribution facility, eventually creating as many as 1,100 jobs. The announcement by Wisconsin-based, privately owned Ashley was welcome news in a region that in the previous 20 years saw scores of factories close and thousands of furniture-making jobs disappear.

Ashley Furniture’s North Carolina facility eventually will produce a variety of interior furnishings, primarily upholstered goods including sofas, loveseats and sectionals. The company stressed that the manufacturing and distribution jobs created will not displace workers elsewhere, affirming that the project represents true job growth.

Does Ashley’s North Carolina investment signal that U.S. furniture manufacturing once again is competitive with Asia, especially China? The answer is yes, of course – with qualifications.

Upholstered goods make sense for domestic manufacture for several reasons. Consumers then have a seemingly infinite array of fabric choices for customizing a purchase, a difficult feat when manufacturing takes place 6,000 miles away. Upholstered chairs, sofas and loveseats come ready to put in service. They don’t knock down or stack for easy shipping, and each item gobbles up oodles of container space, elevating per piece shipping costs to uncompetitive levels.

It’s notable that Lane Venture’s fully upholstered outdoor furniture, such as that of Lee Industries, is made in the United States. Furthermore, these are high-end products not intended for extremely price-sensitive consumers. Made in the USA makes sense for these products.

Could the U.S. casual furniture industry, which has seen so much of its production shift to China and other Asian nations over the past 25 years, one day see manufacturing jobs return to North America? The answer is – it depends.

Interviews with casual furniture executives and observers who focus on U.S-China manufacturing competitiveness indicate that rising production costs in China, primarily for labor, have eroded some of that nation’s overall advantage. Since 2000, average yearly wages in China have been rising at a compounded growth rate topping 14 percent. If the U.S. minimum wage doesn’t change, the average wage in China will surpass that in the United States in 2017.

As a result, some manufacturing jobs that might have gone to China or Indonesia in the last two decades are being created in the United States, but not all are being created by American firms.

China’s Keer Group announced in December that it would build a $218 million cotton yarn plant in Lancaster County, South Carolina. The company cited proximity to the port of Charleston, the area’s strong work force and proximity to cotton as influences on its decision. It was Asian competition, if you recall, that was largely responsible for the decimation of the South’s textile industry beginning in the 1990s.

Keer Group’s investment represents a new trend in U.S.-China business relationships: direct investment in the American economy, including purchase of existing businesses. Shuanghui International Holdings, a majority shareholder in China’s biggest meat processor, last September bought Virginia-based Smithfield Foods in a $7.1 billion deal.

After years of decline, manufacturing in the U.S. is experiencing a bit of a rebound. A 2013 report by Boston Consulting Group expects to see from 2.5 million to 5 million new factory and related service jobs created in the United States by 2020. The consulting firm’s analysis determined that the United States is becoming one of the lowest-cost nations for manufacturing in the developed world.

Boston Consulting’s analysts predict that most jobs will come about in areas such as transportation equipment, chemicals, machinery and electronics, including computers.

Jobs in the furniture industry? No mention. Perhaps that sector of the manufacturing economy is simply too small to figure into the analysts’ forecast. Or perhaps the absence of durable goods in general is an acknowledgement that a significant return of furniture jobs to North America is not likely.

However, the casual furniture industry may see certain jobs return to the United States or Canada. While cost of labor is a leading determinant in deciding where operations take place, it’s not the only factor. Proximity to retail markets, material costs and shipping expenses also must be considered.

Robin Lewis, a 40-year veteran in retail and related consumer products industries, and CEO of The Robin Report, a retail strategy newsletter, and co-author of “The New Rules of Retail” (Palgrave Macmillan), has long studied the shift of U.S. jobs to China. His main area of expertise is in apparel, but he sees many parallels with the furniture industry.

Ultimately, Lewis says, labor-intensive product categories aren’t coming back. Consumers “run the economy,” he says, “and the U.S. consumer isn’t going to accept higher prices.”

Some casual furniture industry jobs already have returned to North America from China. One example involves NorthCape International, a leading maker of resin wicker, deep-seating furniture. The company’s aluminum furniture frames continue to be made in China, where skilled artisans hand-weave extruded resin fiber, often spending hours to create a single chair. Larger pieces, such as sofas, take much longer to produce.

The company once manufactured its cushions in China, but most of that cut-and-sew work is now performed at company facilities in California and Illinois.

“We ship completed cushions to dealers, and we can ship covers/skins to our other warehouses to complete the stuffing process,” says NorthCape International president Tom Murray. “This reduces freight costs and improves turnaround time. Freight is very high on low-weight, bulky items like finished cushions.”

Murray, who majored in economics in college, explains that the company’s labor-intensive manufacturing processes likely will remain abroad.

However, the expense of labor in making cushions is a much smaller percentage of the overall cost than the labor involved in hand weaving. Foam costs less in the U.S. than it does in China, Murray says, so moving cushion production out of China and closer to where the products are sold makes sound business sense.

Bringing jobs back to the United States, jobs once performed here before being moved offshore, is called re-shoring. The cushion-making jobs added by NorthCape are part of the re-shoring trend, says author Michele Nash-Hoff, a California manufacturer’s representative who frequently writes about the state of U.S. manufacturing. She notes that about 15 percent of all manufacturing positions created over the last three years, or 80,000 jobs, resulted from re-shoring.

Most casual furniture manufacturing is unlikely to move back to the United States anytime soon, executives say. Nor is much production likely to shift to other lower-cost nations, such as Vietnam. China simply offers too many advantages.

Take the case of cast-aluminum furniture, a labor-intensive product. Many casual companies produce cast-aluminum furniture in China in wholly-owned plants or with Chinese partners.

“We weld. We grind. We paint. We do castings. It’s a dirty industry,” says Agio president Bob Gaylord. Labor costs are a major determinant of where those processes take place, he says, but they are not the only determining factors.

“We have hundreds of support industries we rely on,” Gaylord says. “To think that you could abandon a place like China” for another nation with cheaper labor, he says, “would be very difficult.”

“China is still the best country to stay with for manufacturing,” says Margaret Chang, president of Treasure Garden. “It may not be the cheapest, as it was 10 or 15 years ago, but it still has competitiveness.”

Treasure Garden founder and CEO Oliver Ma once explored the idea of locating a new factory outside of China. Ultimately, he opted to build a facility in the northern China city of Qingdao, more than 900 kilometers (560 miles) from Treasure Garden’s existing facilities in Ningbo.

The Qingdao factory opened in 2008. Labor costs lower than in the highly industrialized area to the south, a more stable labor market, and a package of government incentives were determining factors.

“Looking back, it was the right decision,” Ma says.

Treasure Garden has opted to create manufacturing facilities outside of China. The company has opened a plant in Brazil to make wooden outdoor umbrellas. It will produce solely for the South American market and not export to the United States, Chang says. The company also has established manufacturing facilities for shade products in Switzerland and Germany.

Telescope Casual Furniture president Henry Vanderminden IV says that consumer tastes and market demand greatly influence where casual furniture manufacturing jobs are located. Sling-aluminum furniture is not as labor intensive as cast-aluminum furniture, he says, which allowed New York-based Telescope to maintain U.S. production as many competitors moved to offshore facilities.

Similarly, China has not offered competition in the plastic lumber category, which Telescope Casual calls MGP, for marine-grade polymer. The petroleum-based materials (virgin or from recycled consumer sources) are not inexpensive; production is highly automated; and the weight and size of finished goods make transoceanic shipping prohibitively expensive. Vanderminden expects manufacturing, and jobs, for MGP-type products to remain in North America.

Returning more of the casual furniture industry’s manufacturing to the United States has many benefits, especially as they relate to an industry with a notoriously short selling season. With production closer to retailers and markets, companies could be more responsive to special orders. Consumers might opt for more custom frame finishes and still receive goods in a timely manner. Special orders typically generate higher margins, and the time and expense required to ship goods across the Pacific would be erased.

Domestic furniture manufacturers, such as Telescope Casual, OW Lee and Tropitone, enjoy those advantages now.

Companies with business models dependent on offshore manufacturing probably won’t make drastic moves without good reason. China’s manufacturing advantages are too numerous, offering enormous adaptability to changing world market conditions and that nation’s own evolving economy and society.

China’s rising wages are designed to stimulate a growing middle class and fuel demand for the very products made by Chinese workers. Agio’s Gaylord, NorthCape’s Murray and other furniture executives have witnessed first-hand the dramatic transformation of China’s economy.

Lewis, who frequently writes about U.S.-China manufacturing shifts, says that China’s makeover, while staggering, shouldn’t be surprising.

“It took us two centuries to go from rural to industrial to a consumer-driven economy,” he says. “China is going through that in maybe 30 years at most. They know they want to get to that point. China, for most of the history of mankind, was the world’s largest economy. They have capitalism in their DNA.”

Just as makers of smartphones see huge potential in the world’s most populous nation, perhaps U.S. casual furniture companies will one day look to China for an important percentage of sales.

But even if Chinese consumers never warm up to the Outdoor Room, China’s workers likely will be making much of the world’s outdoor furniture for the foreseeable future.

“We’re running our business as if it will be around for 20-plus years,” says NorthCape’s Murray. “And I’m willing to bet we’ll still be making stuff in China.”