What's Happening?
A survey conducted by the Reshoring Initiative and Regions Recruiting highlights the importance of a skilled workforce in boosting reshoring efforts among U.S. manufacturers. The survey, which involved 500 U.S. manufacturers, found that a sufficient workforce would lead to more manufacturing being brought back to the U.S. than any other factor. The survey revealed that OEMs would reshore 30% of their products currently offshored if a larger skilled workforce were available. Other factors such as tariffs, currency value changes, and tax cuts also influence reshoring decisions, but workforce availability remains the primary driver.
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Why It's Important?
The findings underscore the critical role of workforce development in reshoring efforts, which can reduce geopolitical risks and make supply chains more resilient. By localizing production, U.S. manufacturers can strengthen the economy and create well-paying jobs. The survey indicates that without a surge in reshoring, millions of manufacturing jobs could remain unfilled by 2030, leading to significant economic losses. The emphasis on workforce development highlights the need for national industrial policies that level the cost playing field and provide the necessary quantity and quality of workers.
What's Next?
To increase reshoring rates, U.S. manufacturers are encouraged to adopt total cost of ownership (TCO) systems for comparing domestic and offshore sourcing. This shift could lead to significant reshoring without government subsidies or supply chain shocks. Manufacturers are also reevaluating sourcing strategies to mitigate risks associated with geopolitical tensions, particularly concerning China and Taiwan. The survey suggests that OEMs should focus on proximity to engineering and faster delivery times to enhance customer satisfaction and reduce risks.
