Reshoring Initiative Data Report Reveals Reshoring Increase
The Reshoring Initiative reports an increase in reshoring in 2020, partially spurred on by the need to adjust supply chains due to the COVID-19 pandemic.
The Reshoring Initiative reports reshoring is up in 2020, with job announcements for 2020 projected to reach 110,000 and bring the total since 2010 to over 1 million.
In 2020, reshoring is exceeding foreign direct investment (FDI) in job creation. Reshoring will continue to be key to manufacturing growth and to U.S. economic recovery in 2021 and beyond. From 2010 through 2019, reshoring and FDI have created over 900,000 manufacturing jobs. Allowing for a conservative two-year lag, this corresponds to 600,000 hires. This figure accounts for 44% of the 1.41 million increase in U.S. manufacturing jobs since the manufacturing employment low in 2010, and 5% of total manufacturing employment of 12.9 million as measured at the end of 2019.
The 2019 combined reshoring and FDI announcements totaled more than 117,000 manufacturing jobs, the third highest pre-revision annual rate on record. Additionally, the 1,100 companies reporting new reshoring and FDI in 2019 was the second-highest annual total in history. The numbers demonstrate that reshoring and FDI are major contributors to the country’s manufacturing sector revitalization.
Top Takeaways from the Report
Due to the pandemic, 2020 has U.S. reshoring outpacing FDI for the first time since 2014. COVID uncertainty is causing companies to emphasize operations in their home countries. The national demand to shorten and close supply chain gaps for essential products is most likely to benefit the PPE, medical, tech and defense industries. Already, 60% of cases after March 2020 mention the pandemic as a factor in reshoring decisions.
The Reshoring Initiative projects that, by year’s end, it will be working with 50 or more companies to reshore about 100 products – a demand 20 times higher than in 2019.
Going forward, the Reshoring Initiative believes President Biden will prioritize reshoring, but apply different methods than President Trump.