The majority of companies have slowed or stopped their offshore manufacturing investments

Efforts, particularly in the United States, to reduce dependence on foreign trade have intensified over the past decade. The concept of shipping manufacturing jobs overseas in search of cheaper labor accelerated in the early 2000s, transforming what was once an employing workforce more than 14.5 million people in 2000 to a low of 11.5 million in 2010. From 2011 to 2023, data from the U.S. Bureau of Labor Statistics shows that the country recovered just over a million jobs, reaching 12.9 million by 2023.

This is likely due in part to efforts started under then-President Donald Trump to encourage domestic manufacturing, and which continued under the Biden administration. The CHIPS and Science Act, the Infrastructure Investment and Jobs Act, the Inflation Reduction Act, and the Build America, Buy America Act, as well as the introduction of tariffs on the period 2018 to 2020 on goods imported from China to the United States, have stimulated the desire to diversify supply chains and bring manufacturing closer to the United States, or even export them

Now, as President-elect Donald Trump threatens to impose widespread tariffs on imported goods, interest in the nearshoring/reshoreing trend is accelerating again. A new survey from Bain & Company confirms anecdotal evidence of what’s happening in the market.

According to the firm, 81% of the 166 CEOs and COOs surveyed plan to move supply chains closer to the market, an increase of 18 percentage points since 2022. Split-shoring (46%) and nearshoring (18%) have also aroused keen interest. Conversely, only 36% of managers plan to continue their investments in offshoring. But only 2% of companies reported having completed their reshoring plans, indicating the trend will continue.

“We believe the current acceleration of reshoring in key markets around the world is a critical trend that requires CEO attention,” said Hernan Saenz, Bain & Company partner and global leader of the Enhancement practice. of the company’s performance. “The multiple disruptions businesses have faced since the pandemic mean the question for business leaders is no longer whether to reinvent supply chains, but how to do so so that their operations become more competitive in terms of costs, more resilient, sustainable and agile to respond to changing circumstances. markets and customer needs.

Bain’s analysis finds that “apparent concerns about the decoupling of economic blocs are contributing to a more than 25% increase in the proportion of companies seeking to reduce their dependence on China,” he says. adding that “the proportion of companies reporting that they have decided to relocate their operations” from China increased to 69% in 2024, compared to 55% in 2022.”

The Inflation Reduction Act, passed in 2022 and incentivizing U.S. companies to relocate to or near manufacturing through subsidies and tax credits, is cited by Bain as one of the main reasons for which companies in markets such as semiconductors, clean energy technologies and electric vehicle supply chains, have been moving their supply chains closer and closer to the United States. The CHIPS Act has played a particularly important role in semiconductor investments in the United States, according to the report.

“The powerful forces behind the reshoring, near-shoring and split-shoring models that our findings show will persist and confront business leaders with the challenge and opportunity to transform their supply chains for reshaped global markets,” said Adam Borchert, Bain & Company partner in the firm’s Performance Improvement practice and global head of its supply chain practice. “We help our clients adapt to these changes and build supply chains that meet market needs, are resilient and scalable, while building management capabilities to adapt to future changes in an uncertain world and constant turbulence. »

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