Originally published in Governing Magazine, April 14, 2025
Makers of everything from food to hardware to components for bigger companies need a boost, which better state and local policies could provide.
Our on-again, off-again trade wars have an underlying theme: that tariffs on imports will boost domestic manufacturing. The assumption is that more U.S.-based large-scale manufacturing, like auto plants, will quickly scale up, but that kind of manufacturing takes years to plan and build, and economic uncertainty undercuts the potential. The far greater opportunity lies in small-scale manufacturing, which can ramp up quickly and broadly, as it did in response to COVID-19 supply-chain disruptions. Prioritizing small-scale manufacturing with specific initiatives should be a national priority.
Much of the sweeping tariff regime that President Donald Trump announced on April 2 is now on hold, and at this writing it’s impossible to predict how things might play out in the months to come. But when those tariffs were announced, the White House emphasized that “increasing domestic manufacturing is critical to U.S. national security” and underscored the importance of large-scale manufacturing, saying that “the need to maintain a resilient domestic manufacturing capacity is particularly acute in advanced sectors like autos, shipbuilding, pharmaceuticals, transport equipment, technology products, machine tools, and basic and fabricated metals.”