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By Jacob Macias
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In August 2026, U.S. manufacturing activity remained firmly in expansion territory, with the Institute for Supply Management’s Manufacturing PMI registering 54.6, following July’s 55.6 reading, the highest since May 2022.
But the same August report showed supplier deliveries slowing for the ninth consecutive month, while electrical components, electronic components, labor, steel and other inputs remained in short supply.
Manufacturing is recovering, but the supply chain beneath it is still under pressure.
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The numbers matter because America’s manufacturing revival is being discussed largely through the factories being announced and the capital being committed to build them.
But a factory does not operate in isolation. Behind every large industrial facility is a network of smaller manufacturers producing components, machining parts, creating tooling, maintaining equipment and meeting the tolerances and delivery schedules that larger manufacturers depend on.
That is where the reshoring conversation needs to go next.
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The challenge is not simply whether America can persuade large manufacturers to build domestically. It is whether the United States has enough domestic supplier capacity to support those factories once they are operational.
The federal government increasingly recognizes this gap.
In May 2026, the Small Business Administration (SBA) sought input on initiatives to strengthen domestic capacity for critical components and specialized manufacturing, specifically identifying supply-chain choke-points and the need to help existing small suppliers scale.
Earlier this year, the SBA also brought small suppliers together with large industrial buyers through a supplier matchmaking initiative.
Those efforts matter because reshoring is not simply a matter of moving an address from one country to another. A factory cannot operate independently of its supplier base.
I have seen that reality from the shop floor.
Allowing Capability To Scale
Machine shops can have talented people, strong customer relationships and decades of accumulated knowledge, yet still struggle when their equipment, information systems and processes have not kept pace with the demands of modern manufacturing.
The problem is not necessarily a lack of capability. Sometimes it is a lack of infrastructure that allows that capability to scale.
Modern manufacturing requires far more visibility than the traditional phone call or email asking whether a job is finished.
Customers need to know where an order stands, how much has been completed and whether a delivery is still on schedule. A supplier that cannot provide that information quickly can become a weak link even if the parts themselves are excellent.
The same is true of quality.
As manufacturers bring more production back to the United States, domestic suppliers will be competing not simply on whether they can make a component, but on whether they can make it repeatedly, precisely and predictably.
In machining, that can mean working within tolerances measured in thousandths of an inch or, for some applications, even tighter.
Making Domestic Production More Efficient
Measurement technology that can monitor a part during production can help identify deviations before an entire batch becomes unusable.
That kind of modernization is not glamorous. It does not generate the same headlines as a billion-dollar factory announcement. But it is the infrastructure that determines whether a factory has a reliable domestic supply chain behind it.
Capacity creates another problem.
A small machine shop cannot compete indefinitely if every component requires multiple setups, excessive manual intervention or long periods of machine downtime.
Modern multi-operation equipment can consolidate processes, reduce handling and make higher-volume production more practical.
The objective is not simply to buy expensive machinery. It is to make domestic production efficient enough that American suppliers can compete on quality, lead time and cost.
But technology alone will not solve the problem.
The Needs of Modern Manufacturing
The United States can purchase every advanced machine available and still face a capacity shortage if there are not enough people who know how to program, operate, maintain and troubleshoot that equipment.
That is perhaps the most overlooked part of the reshoring conversation.
Manufacturing knowledge has traditionally been passed from experienced machinists to the next generation through years of hands-on work.
As that workforce ages, some of that institutional knowledge risks disappearing with it. At the same time, younger workers are entering an industry that increasingly combines traditional machining skills with software, automation, measurement systems and advanced manufacturing technology.
The answer cannot be to choose between skilled trades and technology. Modern manufacturing needs both.
The federal government has begun putting resources behind that idea.
Protecting the Ecosystem
The SBA announced a $50 million grant opportunity for organizations providing workforce training and technical assistance to small manufacturers, while its broader manufacturing initiatives have also focused on helping smaller businesses overcome operational, technical and workforce barriers.
Those initiatives point toward a more useful definition of reshoring.
Reshoring should not simply mean that a large factory is located somewhere in the United States. It should mean that the ecosystem required to operate that factory is increasingly capable of being supplied domestically.
That ecosystem includes small machine shops making a precision component. It includes the tooling company producing specialized equipment.
It includes the machinist who knows how to diagnose a problem that a manual cannot explain. It includes the programmer who can translate a complex design into a repeatable manufacturing process. It includes the supplier that can tell a customer exactly where an order stands rather than leaving procurement teams guessing.
These businesses are easy to overlook because they are rarely the ones announcing billion-dollar investments. Yet they form the connective tissue between industrial investment and actual production.
The Manufacturing Revival
Research from McKinsey has similarly identified the scale of America's manufacturing exposure, estimating that the United States imported about $3 trillion in manufactured goods in 2025 and that roughly one-quarter of those imports are particularly exposed because of factors including supply concentration, national-security relevance and geopolitical distance.
McKinsey's analysis also points to talent and resilient supplier networks as important constraints on expanding domestic manufacturing.
That should change how we measure the progress of the manufacturing revival.
The number of factories announced is one measure. The amount of investment committed is another. But neither tells us whether the smaller companies supplying those factories have the machinery, workforce, capital and operational systems to meet the demand.
The real test will happen on the shop floor.
The Future of Reshoring
America can announce all the factories it wants. But if the domestic suppliers capable of feeding those factories cannot scale, modernize and develop the next generation of skilled machinists, reshoring will remain incomplete.
The next phase of American manufacturing should therefore focus less on the spectacle of the factory opening and more on the network underneath it.
Because the strength of a manufacturing economy is not determined only by how many factories it can build. It is determined by whether the thousands of smaller businesses around those factories are capable of keeping them supplied.
Federal and state policymakers, manufacturers and industry leaders should therefore look beyond headline investment and put greater attention on the machine shops, suppliers and skilled workers that will determine whether that investment can translate into sustained domestic production.
That is where the future of reshoring will ultimately be decided.
Jacob Macias is a manufacturing professional whose experience in a multigenerational machining business informs his work on shop-floor modernization, skilled-workforce development and domestic supply-chain capacity.
The views expressed in this article are his own.
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