#143 – Inside Our Industry – Reshoring, Foreign Direct Investment Job Announcements Set New Record in 2022Posted on | Inside Our Industry
More reshoring and FDI (Foreign Direct Investment) news from the Reshoring Initiative’s 2022 Data Report was shared on industryweek.com last week. Not surprising is the fact that more than half of all announcements involve investment in chips and EV batteries.
Reshoring, Foreign Direct Investment Job Announcements Set New Record in 2022
March 27, 2023 | Anna Smith | IndustryWeek.com
“The total number of jobs announced since 2010 is now nearly 1.6 million,” according to the report.
Reshoring and foreign direct investment (FDI) job announcements for 2022 reached a new record of 364,000, a 53% increase from the previous year, according to the Reshoring Initiative’s 2022 Data Report.
The report credits the Inflation Reduction Act and the Chips and Science Act for the drastic increase in U.S. manufacturing by both foreign and domestic companies.
Securing electrical equipment as the top industry, “U.S. investments in chips and EV batteries accounted for 53% of 2022 job announcements,” according to the report. “Electric vehicle batteries were the most active product to be reshored/FDI’d in 2022.”
The top driving factors for the trend were reported as government incentives, skilled workforce and supply chain interruption risk.
Together, the South and the Midwest account for 76% of jobs, with Ohio, Georgia, Tennessee and North Carolina appearing in the top five. However, New York boasts the highest number of job announcements for 2022 at 12%, a large jump from last year’s report where the state ranked 10.
From 2010 through 2022, Asia has accounted for 72% of reshoring; Asia has also surpassed Europe for FDI over the same time period, coming in at 48%.
“We expect 2023 and 2024 to remain strong, continuing at approximately 350,000 job announcements per year,” projects the report.
On its list of factors likely to slow reshoring and FDI, the No. 1 cause is the continuation of workforce shortages, echoing the concerns of many companies anxious to find skilled labor. Other forces are named as a high inflation rate, lack of automation investments and increased industrial capabilities in other countries.
Overall, the rate of job announcements last year was up almost 6,000% from 2010. “If the current trajectory continues, the U.S. will reduce the trade deficit, add jobs and become safer, more self-reliant and resilient.”
Although there is uncertainty, the report concludes that we can be cautiously optimistic about meeting the challenges that are to come.