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How Foreign Investment Is Boosting U.S. Manufacturing

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New research shows how foreign-owned factories tend to be more productive, higher paying, and more technologically advanced. Here’s how U.S. companies benefit.

Foreign investment presents U.S. manufacturers with two opportunities. Although it might be tempting for manufacturers to invest in solving only their immediate workforce needs, a larger investment in building the regional workforce development pipeline can make for stronger suppliers, as well as a more capable talent pool in the future as the company prepares to grow. Second, one of the potential benefits of foreign investment for domestic firms is fresh ideas.

In August of 2022, industrial policy returned to the United States. The CHIPS and Science Act and the Inflation Reduction Actto revitalizing manufacturing in the United States. Advocates say the investment is working. New factories in the United States producing semiconductors, batteries, and electric vehicles are emerging like popcorn across the American south and west. The level of U.S. manufacturing construction in 2024 is more than three times what it was in 2019.

 

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