More than four-in-five North American manufacturers considering reshoring
Report estimates that if these manufacturers follow through on reshoring, it could drive $443 billion in US economic value
According to a new report from Thomas, a solutions provider for the supply chain industry, 83% of North American manufacturers are likely or extremely likely to reshore (up from 54% in March 2020).
If these manufacturers with plans to reshore bring on just one single-contract domestic supplier, the shift would drive as much as $443 billion in US economic value, they estimate.
The survey participants revealed a strong interest in reshoring due to obstacles with overseas suppliers, such as availability of technical support and time zone differences.
While procurement professionals surveyed identified challenges in sourcing materials locally (including barriers of price for 40% of respondents, and speed for 23%), an overwhelming majority still planned to reshore some of their operations.
The survey found that the automotive and oil and gas sectors are leading the charge toward US and Canada-based operations.
The registered users of Thomas’ platform are also reflecting the trend in reshoring, with more than $204 billion in sourcing requests over the past 12 months, compared to $69 billion in calendar year 2018.
“We are witnessing the wholesale re-examination of supply chain relationships, which will realign global manufacturing for decades to come. With North American businesses accelerating reshoring and replacing some of their overseas suppliers with domestic alternatives, U.S. manufacturers are being presented with an unprecedented opportunity,” said Tony Uphoff, Thomas president & CEO.
“The insights from this year’s State of North American Annual Report further underscore the need for increased investment in skilled labour and manufacturing technologies to ultimately improve the trade deficit and future-proof supply chains to protect against potential disruptions.”