Front Line: Job Creation Through Reshoring
Thursday, March 25, 2021
Back in the 1980s, the term “offshoring” became a business buzzword as more and more U.S. companies moved manufacturing to foreign countries, typically to save on labor costs. In recent years, “reshoring” has been added to the lexicon as companies decide to bring manufacturing back to the U.S., for various reasons.
In 2020, reshoring created more U.S. jobs than foreign direct investment (FDI) for the first time in seven years, according to data collected by the Reshoring Initiative. In 2020, U.S. companies reshored nearly 69,000 manufacturing positions, while greenfield investment in the same industries created fewer than 42,000 jobs, according to the Initiative. Reshored jobs were up nearly 45 percent last year, with FDI jobs down 40 percent. The report is based on job announcements and annualized data from the first half of 2020.
Reshoring Initiative founder and President Harry Moser said the Covid-19 pandemic accelerated a trend that had already begun, with the pandemic a motivating factor in 60 percent of cases since March 2020. Medical equipment reshoring cases in the first six months of 2020 were double the full-year 2019 figure. Longer-term, the most active industries in reshoring have been transportation equipment, machinery, electronic products, and appliances.