Supply Chain Pain Part 2

Moving manufacturing to the U.S.

Supply Chain Pain Part 2

Companies are slowly coming to the realization that being dependent on suppliers in other countries is bad for their bottom line as well as bad for the country. As I discussed last time, corporations created supply chain dependencies by moving production offshore to achieve lower labor costs.

One dramatic example of the consequences of these decisions in the semiconductor shortage. According to one article, Taiwan Semiconductor Manufacturing Company (TSMC) “accounts for 90% of the world’s super-advanced chips”1. Pandemic related shortages of chips have led to a shortage of finished products in the global auto industry. If it were more disrupted it could affect everything we use, including cell phones and new 5G networks.

Now corporations are responding to this issue by relocating some manufacturing facilities to the United States. For example, Intel is building a new manufacturing site in Ohio which will create 3,000 Intel jobs and many more in supporting infrastructure. The catch? “Ohio offered Intel Corp. incentives worth roughly $2 billion” according to this article:

I’m sure it’s a good investment, but shouldn’t we be able to move manufacturing back to the United States without having to pay these kinds of fees? Many smaller businesses will never get this kind of incentive, yet their presence in our country is key to a good supply chain.

As a small American business, we hope the trend towards U.S. manufacturing continues. It’s the best thing for our country. And maybe someday we can do it just because it’s the right thing to do.



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