For nearly two decades, manufacturers have pursued global sourcing strategies focused primarily on reducing costs. Today, the priorities have shifted, writes Material Handling & Logistics (Nov. 4, 2026). Supply chain resilience, risk management, and operational agility are becoming just as important as direct labor savings.
This shift is gaining momentum. U.S. manufacturers and foreign investors announced 247,000 manufacturing jobs through reshoring and foreign direct investment in 2025, continuing a trend that has added more than 2.3 million jobs since 2010. Even more significant, projections indicate reshoring activity could grow by 25% in 2026.
The OM message is clear: manufacturing location decisions, the topic of Chapter 8, are increasingly being driven by total value rather than unit cost alone.
Several forces are fueling this movement. Ongoing geopolitical uncertainty, transportation disruptions, tariff exposure, and the need for faster customer response times have exposed vulnerabilities in extended global supply chains. Companies are recognizing that proximity to suppliers, customers, and production assets can improve service levels while reducing operational risk.
Technology is also changing the economics of domestic manufacturing. Investments in automation, robotics, and AI are helping companies address labor shortages, improve productivity, and narrow cost gaps that once favored offshore production.
The challenge, however, remains workforce availability and policy stability. Skilled labor shortages continue to constrain growth.
For manufacturers willing to embrace advanced automation, workforce development, and strategic supply chain redesign, reshoring represents more than a location decision. It is an opportunity to build more resilient operations, enhance responsiveness, and create a competitive advantage in an increasingly uncertain global marketplace.
As the reshoring accelerates, operations leaders should evaluate not only where products are made, but how supply chain decisions support long-term business resilience and growth.
- How should operations leaders balance cost efficiency with supply chain resilience when deciding whether to reshore production? What metrics beyond labor cost should be included in manufacturing location decisions.
- Can automation and AI fully offset the labor challenges associated with reshoring manufacturing to the U.S.? Why or why not?