Biden’s State of the Union Makes a Case for Reshoring

As consumers face rising prices and manufacturers navigate supply chain disruptions and workforce shortages, US President Joe Biden made a strong case to bring manufacturing back to American shores during his administration’s first State of the Union address Tuesday night.

“Look, our economy roared back faster than most predicted, but the pandemic meant that businesses had a hard time hiring enough workers to keep up production in their factories,” Biden stated during the speech. “The pandemic also disrupted global supply chains. When factories close, it takes longer to make goods and get them from the warehouse to the store, and prices go up.”

As the effects of public health crisis begin to subside, President Biden suggested that one way for the country to combat inflation is to increase investments in domestic manufacturing assets, citing Intel’s plans for a semiconductor “mega site” in Ohio as an example.

“Make more cars and semiconductors in America. More infrastructure and innovation in America. More goods moving faster and cheaper in America. More jobs where you can earn a good living in America. And instead of relying on foreign supply chains, let’s make it in America,” President Biden said.

Rosemary Coates, founder and executive director of the Reshoring Institute, a non-profit and non-partisan organization that helps companies to bring manufacturing back to the US, told Powder & Bulk Solids that she welcomed the president’s message on Tuesday.

“We were delighted to hear President Biden address global supply chain issues as well as the urgent need to re-establish manufacturing in America in his State of the Union address,” said Coates. “The pandemic exposed the major risks in supply chains and the urgent need for manufacturing semiconductors, pharmaceuticals, and other products that are critical to the health and well-being of all Americans. With the federal government’s focus and potential funding, we can rebuild our manufacturing base in America.”

83% of North American manufacturing executives surveyed by Thomas last year said they are likely or extremely likely to reshore, with the momentum driven changes in domestic sourcing and COVID-19 related supply chain issues.

“The pandemic was a true wake-up call for global supply chains. We need to rethink where and how we are manufacturing. At the Reshoring Institute, we are seeing a major uptick in companies interested in bringing manufacturing back, increasing their domestic sourcing of raw materials and parts, and reevaluating their global manufacturing strategies,” Coates explained to Powder & Bulk Solids. “These trends are happening across many industrial and consumer products sectors. “ 

With growing geopolitical tensions and the continued uncertainty of the pandemic, it is likely that reshoring will remain an important topic over this year and beyond.