Onshoring

The onshoring that started with Trump and is continuing with Biden is beginning to provide the promised high paying jobs. So far it is just in the tech industry and that is mostly the result of the Jobs Act, the Inflation Reduction Act and the Chips bill and all this growth is the reaction to government spending but that is about to change. There are signs that companies are coming home and Walmart is a good example. They are pushing to buy more American. They started with food products but are moving into other areas. Walmart will buy more from existing domestic suppliers, do business with new domestic suppliers, and help current suppliers reshore their overseas production. Walmart has instructed its buyers to be more flexible with current supplier capabilities. Target and Home Depot are following similar programs. The United States is uniquely positioned to take advantage of the movement away from globalization. The US has a large labor force and access to 80 million people of working age in nearby Mexico. This will spur economic development toward a long term expansion. In the early years there will be high inflation but long term it will result is higher productivity because of shorter supply chains. These shorter distances are not only less costly but allow for quick changes in manufacturing making it easier to adjust to changing consumer demands. While the US benefits from the move away from globalization other places like the EU and China will suffer mostly because the shortage of workers and long distance supply lines.