Manufacturers Reshoring
Reshoring Initiative (RI) reports the pace for onshoring is picking up following the pandemic of the past two years. RI estimates that 260,000 new manufacturing jobs will come back to the U.S. in 2022 in various sectors, from microchip makers to diaper makers and steel production. He said the math makes sense for many manufacturers to initially reshore at least 20% to 30% of production.
Given the ongoing supply chain challenges of the past two years, RI said more manufacturers now see the need to look at reshoring if they intend to have adequate, just-in-time inventory.
RI found that the private and federal push for the domestic supply of essential goods led to 230,000 U.S. manufacturing jobs in 2021, which brings the total number of reshored jobs announced since 2010 to 1.3 million. The study states that reshoring efforts grew by 100% in 2021, and in 2020, a record number of companies (1,800) reported efforts to bring jobs back to the U.S.
Historically, the most active reshoring has been those companies that left and probably should not have done so, including machinery, transportation equipment and appliances. Recently added to that list are essential products on which the U.S. relies, such as electric batteries, semiconductors, medical equipment, and pharmaceuticals.
In the past year, the construction of new U.S. manufacturing facilities jumped 116% with efforts by Intel to bring two chip factories to the Phoenix area. Steel is also coming back with U.S. Steel investing $3 billion in Osceola to create 900 jobs in northeast Arkansas. Gov. Asa Hutchinson said Arkansas would soon surpass Pennsylvania as the top steel-producing state in the nation.