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ICYMI: WSJ: U.S. Companies on Pace to Bring Home Record Number of Overseas Jobs

August 22, 2022

"U.S. companies are bringing workforces and supply chains home at a historic pace."

Wall Street Journal's Dion Rabouin reports that, "American companies are on pace to reshore, or return to the U.S., nearly 350,000 jobs this year, according to a report expected Friday from the Reshoring Initiative. That would be the highest number on record since the group began tracking the data in 2010."

For instance, "over the past month, dozens of companies have said they had plans to build new factories or start new manufacturing projects in the U.S. Idaho-based Micron Technology Inc. announced a $40 billion expansion of its current headquarters and investments in memory manufacturing. Ascend Elements said it would build a $1 billion lithium-ion battery materials facility in Kentucky. South Korean conglomerate SK Group said it would invest $22 billion in a new packaging facility, electric vehicle charging systems, and hydrogen production in Kentucky and Tennessee."

While there are many factors at play, Rabouin also credits the Biden-Harris Administration with "luring companies back. The Chips and Science Act and the Inflation Reduction Act, both passed this month, provide tax breaks and other incentives for building and investing in manufacturing centers for goods such as semiconductors, electric vehicles and pharmaceuticals."

Read more below:

Wall Street Journal: U.S. Companies on Pace to Bring Home Record Number of Overseas Jobs
[Dion Rabouin, 8/20/22]

After Covid-19 pandemic upended supply chains, American companies are shifting jobs and processes to the U.S.
U.S. companies are bringing workforces and supply chains home at a historic pace.

American companies are on pace to reshore, or return to the U.S., nearly 350,000 jobs this year, according to a report expected Friday from the Reshoring Initiative. That would be the highest number on record since the group began tracking the data in 2010. The Reshoring Initiative lobbies for bringing manufacturing jobs back to the U.S.

Over the past month, dozens of companies have said they had plans to build new factories or start new manufacturing projects in the U.S. Idaho-based Micron Technology Inc. announced a $40 billion expansion of its current headquarters and investments in memory manufacturing. Ascend Elements said it would build a $1 billion lithium-ion battery materials facility in Kentucky. South Korean conglomerate SK Group said it would invest $22 billion in a new packaging facility, electric vehicle charging systems, and hydrogen production in Kentucky and Tennessee.

"We think it'll be a long-term trend," said Jill Carey Hall, U.S. equity strategist at Bank of America Corp. "Before Covid there was…a little uptick but obviously Covid was one big trend and you've seen a continued big jump up this year."

To be sure, globalization has been a tailwind for investors and large companies for much of the past 30 years, particularly U.S. firms. Increased trade across borders boosted profits and productivity and allowed countries to focus on the goods and services they were best equipped to produce. Globalization has also provided multinational companies with new customers and new pools of low-cost labor.

But the Covid-19 pandemic, which snarled supply chains worldwide, pushed many executives to think about bringing their business closer to home. Russia's invasion of Ukraine, which upended commodities markets, is another motivator. So is the possibility of a conflict between China and Taiwan, which produces the chips used in smartphones, personal computers and cars.

The U.S. government is also luring companies back. The Chips and Science Act and the Inflation Reduction Act, both passed this month, provide tax breaks and other incentives for building and investing in manufacturing centers for goods such as semiconductors, electric vehicles and pharmaceuticals.

Investors' increased focus on carbon emissions also has bolstered the need for closer-to-home supply chains. Carbon pricing mechanisms and taxes recently implemented in the European Union and elsewhere will further reduce the appeal of extensive cross-border supply chains, Barclays economists wrote in a recent note to clients […]

Joseph R. Biden, ICYMI: WSJ: U.S. Companies on Pace to Bring Home Record Number of Overseas Jobs Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/357401

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