August 2022 E-News, Part II: 1H 2022 Data Report: Amidst Global Risks Reshoring Accelerates

Reshoring Initiative 1H 2022 Data Report

The Reshoring Initiative 1H 2022 Data Report shows reshoring and FDI continuing gains. The current projection of jobs announced by year-end is around 350,000, another record high, up from 260,000 in 2021. The second quarter slowed moderately but is still above the rate of any previous year. Supply chain gaps, the need for greater self-sufficiency and the threat of China decoupling are some of the factors driving the increase in reshoring. Read the full Reshoring Initiative 1H 2022 Data report: Multiple Supply Chain Risks Accelerate Reshoring for detailed analysis of data on jobs, companies, industries, factors at play and more. The release earned a half  page article in the August 20th Wall Street Journal.

Supply Chain Risks

The US National Defense Supply Chain Is in Crisis  “The military and its partners have become too dependent on foreign-made parts, materials and minerals.”

Rising Seas Are the Next Crisis for the World’s Ports They’re still reeling from the effects of the pandemic, but in the coming decades, shipping `companies will increasingly have to deal with rising seas. Global shipping will get more expensive and unpredictable.

Supply Chain Officers Are Conducting Climate Change Risk Assessment  Climate change planning includes emissions reduction. The best way to do that is to reshore.

Economic Downturn is the Top Risk For Companies Other risks include energy price inflation and key material shortages. Reshoring helps with all three risks:

• Downturn: Reshoring directly strengthens the economy and markets. Shorter supply chains allow less inventory and faster delivery and thus less whipsaw of company balance sheets.

• Energy inflation: Reshoring means much less shipping and less warehousing.

• Material shortages: Developing domestic or North American sources reduces the chance of stocking out.

Call for a Better Skilled Workforce

Gap Between Students' Aptitudes and Their Career Interests Focus of New Report Conclusion: Students have the required basic skills but lack the exposure to many industries. For example, “Students have over 3x more aptitude than interest in advanced manufacturing careers.”  Schools need to “better help students find their “why” and then draw connections to related career options

So that Happened: Free Tech School Tuition, Charging Station Manufacturing in Michigan, Changes to the IW U.S. 500 Advocates for subsidies for tech training.

Bringing Back the Guts of American Manufacturing “Sachin Shivaram, chief executive officer of Wisconsin Aluminum Foundry, and Harvard Class of 2003, reports from Wisconsin on the state of manufacturing today and policies to revive the economy of his home state.”

Drivers

Automakers Invest Billions in North American EV and Battery Manufacturing Facilities Reshoring is booming. EV batteries are an important part of the surge.

Source: CAR – Center for Automotive Research

Rubio, Hyde-Smith Introduce Bill to Kickstart American Rare Earth Manufacturing  Another key essential industry for U.S. self-sufficiency.

Tesla Lobbying Ontario Government To Set Up EV Manufacturing Facility  Tesla Inc is lobbying the Ontario government as part of an effort to set up an advanced manufacturing facility in Canada and working to identify opportunities for industrial facility permitting reforms. EV makers in the United States are looking to source materials and build cars closer to home to diversify supply chains and lower their dependence on China. That effort could accelerate due to the Inflation Reduction Act of 2022.

Other Developments

Manufacturing Achieves Pre-Pandemic Employment Levels After Months of Incremental Gains  Reshoring and FDI have contributed about 270,000 of the 1.4 million manufacturing jobs added since the low point in April 2020.

Reshoring as a Trending Choice for Manufacturers “Reshoring can help manufacturers improve agility. A trend toward reshoring has led to a 116% increase in const