A Blueprint To Accelerate Reshoring
This year marks the 250th anniversary of the signing of the Declaration of Independence. In honor of the semiquincentennial, I would like to share my congressional testimony to the House Committee on Small Business, “Made in the USA: How Main Street is Revitalizing Domestic Manufacturing,” presented on Nov. 20, 2025. I reported on the state of U.S. manufacturing and offered a blueprint to accelerate reshoring.
Message to Congress
My message to Congress was straightforward: Reshoring is already working; it disproportionately benefits small businesses; and with the right policy focus, it can transform the U.S. economy by 2040.
Reshoring Has Moved Beyond Theory
When we founded the Reshoring Initiative in 2010, reshoring was more of a theory than a reality. In that year, companies announced about 11,000 reshoring and foreign direct investment (FDI) manufacturing jobs.
Today, the annual rate has increased to roughly 240,000 jobs per year – a compound annual growth rate of about 25%. Even with some expected softening in 2025, the updated 2025 "Reshoring Initiative Report Preview" shows approximately 245,000 announced jobs, a modest decline from 2024’s strong results. This slight dip still reinforces the strength of the underlying trend (see Figure 1). Final results will be available soon.
In recent decades, we have seen the start of industrial policy interventions shift toward cultivating a more proactive, technology-driven U.S. manufacturing industry, coupled with the emergence of skilled workforce initiatives. This transformation is bolstering a manufacturing comeback that is reshoring U.S. supply chains.
With a more coordinated industrial policy, the reshoring rate could double, increasing U.S. manufacturing output by 50% by 2040 and eliminating the $1.2 trillion goods trade deficit.
U.S. Small Businesses
A company can only reshore what it has been importing. Big companies and OEMs make the decisions to reshore. Small businesses do much of the reshoring work, producing the components, tools, and automation systems needed by their larger customers. To accelerate small businesses’ reshoring, we need to convince their customers to reshore assembly and component sourcing.
The Small Business Multiplier Effect
A powerful example is GE Appliances, a Haier company, headquartered in Louisville, Kentucky. By bringing production back from China and Mexico, GE Appliances has invested an additional $6.5 billion in expanding U.S. manufacturing. The result is a network of roughly 6,500 U.S. suppliers, mostly small companies, across all 50 states. Each year, GE Appliances purchases about $4.6 billion in materials, components, and services from these domestic suppliers.
This is exactly how reshoring should work: One large-company decision creates thousands of small-business opportunities nationwide.
Root Causes of Offshoring
Our survey conducted with Plante Moran and the 2025 Reshoring Survey show that manufacturing cost/price is the overwhelming cause of offshoring and the barrier to reshoring. The U.S. cost averages 10% to 20% higher than most other developed countries and 50% higher than China.
That difference drives big companies to source components and finished products offshore. President Joe Biden’s incentives and President Donald Trump’s tariffs are, essentially, efforts to level the cost playing field. The cost differential is primarily due to the U.S. dollar being overvalued by about 20% versus other developed countries and 100% versus emerging market countries, according to the International Monetary Fund. Figure 2 compares Chinese FOB prices to U.S. prices across 190 cases. China’s prices average about 60% of U.S. prices.
Skilled Workforce: The Cornerstone of Reshoring Success
The 2025 Reshoring Survey’s findings reveal that a highly skilled workforce is the top enabler for companies considering reshoring. Conversely, a lack of skilled labor is a persistent deterrent. When we asked companies which policy actions would most influence their reshoring decisions, skilled workforce ranked far above lower taxes, fewer regulations, or even tariffs. Manufacturers understand that reshoring at scale requires more people – and better-trained people – than we currently have.
What U.S. State and Local Governments Should Do
The Department of Labor (DOL) should promote “a good career for all” rather than “college for all.” DOL charts show that graduates of apprenticeship programs earn average incomes comparable to those of degree holders and quantify the advantages of starting work at age 18 without college debt.
The Department of Education should issue fewer college loans for low-demand majors, increase loans for engineers, and provide “apprentice loans” that employers pay off if the worker stays on after the apprenticeship. State and local governments should reintroduce high school career and technical training (CTE) and strengthen community college manufacturing programs.
Industrial Policy Recommendations
The United States must increase the quality and quantity of its skilled workforce and engineers and level the cost playing field. Our first recommendation is to reduce the U.S. dollar by about 20% through the “market access charge” provision in the bipartisan Competitive Dollar for Jobs and Prosperity Act, introduced in the 116th Congress by Sens. Tammy Baldwin, D-Wis., and Josh Hawley, R-Mo. This would overcome the root cause of offshoring.
Our second recommendation is to impose a value-added tax (VAT), with some of the proceeds used to protect lower-income groups. Our third recommendation is tariffs. If chosen, we recommend simplifying and stabilizing the tariffs with one rate for everything, from everywhere, forever – except a higher rate on China.
We prefer the currency strategy over tariffs, as currency affects the import and export of goods and services. Tariffs only benefit goods imports and probably hurt all other categories.
We suggest that the president and all members of Congress call on their corporate constituents to use the Reshoring Initiative’s Total Cost of Ownership estimator tool when sourcing and siting. With 100% compliance, the industry would create 1 million jobs at no cost to the government. In addition, we recommend that the government not raise corporate taxes and reduce the country’s health care costs, which drive up manufacturing costs.
What Small Businesses Can Do
Small businesses should recruit, train, and upskill their workforce and automate where possible. They should use TCO when selling against imports or convincing customers to reshore. Only 30% do so. They should promote the advantages of reshoring.
Why Reshoring Matters Nationally
Beyond jobs, reshoring addresses nearly every major national priority. It reduces income inequality, shrinks the goods trade deficit (currently about $1.2 trillion annually), strengthens defense preparedness, and improves long-term economic competitiveness.
Are You Thinking About Reshoring?
The milestone of America’s 250th anniversary invites historical reflection but also presents a powerful moment to reset a skilled American workforce and define the future of U.S. manufacturing.
Access the full list of Reshoring resources offered by the Reshoring Initiative. For help, contact me at 847-867-1144 or email me at harry.moser@reshorenow.org.
Have you reshored a metal component or product? Apply for the National Metalworking Reshoring Award. The 2026 winner will be honored at IMTS 2026 – The International Manufacturing Technology Show.
