Recent tariffs have created a cost-intensive and unpredictable environment for manufacturers. Parsec’s new survey shows a major long-term shift toward reshoring as manufacturers increasingly recognize the value of shorter, more resilient supply chains.

Key Takeaways:

70% of global manufacturers prioritized cost-cutting over supply chain resiliency over the 12 months ending February 2026.
70% of global manufacturers have reshored operations or are in the process of doing so—a stark change from 33% in 2024.

To uncover other trends taking place across our industry, explore our 2026 State of Manufacturing Report today.

How Have Tariffs Impacted Manufacturers?

For well over a year, tariffs have dominated manufacturing conversations. Anecdotally, it certainly feels like tariffs have greatly impacted manufacturers’ balance sheets, operating conditions, reshoring strategies, and overall outlook for the future.

Now, thanks to our 2026 State of the Manufacturing Industry survey, we have hard data to tell us what’s going on. Let’s dive into tariffs—both their direct impact on the industry and their resulting ripple effects.

How Have Manufacturers Responded to Tariffs?

Tariffs themselves are nothing new to manufacturers. But this most recent round was both intense and unpredictable. It’s been a lot for businesses to handle.

Last summer, the tariff rate on raw materials like steel and aluminum rose to 50%. And, since there’s no substitute for these mission-critical materials, manufacturers had no choice but to bear the burden of heightened costs.

To keep balance sheets from spiraling out of control, manufacturers accepted higher costs in one area while trying to reduce costs in others. In many cases, businesses reduced focus on key initiatives to keep up. Our 2026 survey found that nearly three-quarters (70%) of manufacturers worldwide prioritized cost-cutting over supply chain resiliency during the 12-month period ending in February 2026.

For the short term, it seems as though manufacturers adopted a “do what you gotta do” philosophy, prioritizing operational continuity above all else. This grit and focus allowed them to start mapping out longer-term initiatives to support resiliency—like reshoring.

What Is Reshoring Like in 2026?

Something big is happening with reshoring.

2024: 33% of manufacturers had completed or were in the process of reshoring; 38% had no plans.

2026: 70% are in the process; 12% have no plans.

We don’t know whether this seismic shift is due solely to tariffs or other factors like supply chain disruptions and geopolitical instability. Still, one thing is clear: manufacturers around the world are increasingly recognizing the benefits of shorter supply chains and more localized operations.

Curiously, when we asked respondents where they were shifting production to and from, the United States was only slightly “in the black.”

Just over half (52%) of U.S. manufacturers have shifted (or are looking to shift) production away from the U.S., while a slightly larger share (58%) plans to bring operations into the country. While this net positive will be a boon for local economies, it’s perhaps not as big a shift as we might expect given the new cost-intensive environment associated with imported goods.

It could be that U.S. manufacturers simply don’t want to rush their decision-making process, aware that reshoring comes with several challenges.

What Makes Reshoring Hard?

Between reallocating capital, acquiring or building a new facility, obtaining equipment, hiring teams, and adhering to local regulations, reshoring is—quite simply—an ordeal. It can be a lengthy, intense process.

When asked about the top challenges they anticipated having with their reshoring initiatives, manufacturers cited:

Managing increased operational complexity (46%)
Adjusting supply chain logistics and transportation networks (44%)
Increasing labor costs compared to offshore locations (44%)

Regarding how reshoring might impact their workforce, manufacturers acknowledge both the pros and cons.

Nearly two-thirds (64%) said reshoring would increase opportunities for job growth and creation, and 56% said it would improve morale and retention.
At the same time, 56% said reshoring would increase demand for skilled labor—in an already-strained labor environment—and 54% cited increased labor costs as a key impact.

But just because something is challenging doesn’t mean it’s not worth it. Reshoring might not make sense for every manufacturer, but when it aligns with overall strategy, the benefits are far-reaching: predictable logistics, enhanced resilience, a stronger brand reputation, and more.

Conclusion

Nobody knows exactly what’s coming down the pike. Regulations come and go; no market condition is permanent. The best thing manufacturers can do is keep their compasses pointed due north: toward their long-term strategies. As disruptions like tariffs threaten to veer you off course, consider both the short- and long-term steps needed to hold the line.

If you’re considering reshoring and have questions about migrating TrakSYS, reach out today.

To learn more about Parsec’s 2026 survey, click here.