News
May 12, 2025

Why Tariffs Alone Won’t Revive U.S. Manufacturing

Caroline Raffetto

While President Donald Trump’s tariff-driven strategy is intended to jumpstart a domestic manufacturing comeback, that effort can’t succeed in isolation, writes one construction industry executive.

Brian Gallagher, vice president of corporate development at the Oakbrook, Illinois-based contractor Graycor, argues that while tariffs may play a role in reshoring, they’re just one part of a much more complex puzzle.

“I’ll go out on a limb with what may be an unpopular sentiment at the moment: President Donald Trump’s economic policies and tariffs may very well help expedite the return of manufacturing to the U.S.,” Gallagher writes.

But he adds that tariffs, by themselves, aren’t enough to reverse decades of globalization. Despite encouraging signs — such as early investments in industries like steel, semiconductors, life sciences and automotive — Gallagher warns that a full manufacturing resurgence in the U.S. won’t happen quickly or easily.

“They won’t achieve that outcome in a vacuum,” he says.

Beneath the headlines announcing factory builds and reshoring efforts lies a difficult reality: Building domestic manufacturing capacity is an extensive, resource-intensive process. It involves more than just deciding to move operations — it requires overhauling supply chains, securing capital, and managing complex logistical challenges.

“Reshoring manufacturing involves complex, long-term decisions that require significant planning, capital and coordination,” Gallagher notes.

He emphasizes that the path to reshoring varies greatly by sector. For some manufacturers — particularly those dealing in high-volume, low-margin goods — overseas production remains more feasible.

“Reshoring isn’t a one-size-fits-all solution — its viability depends heavily on the industry, cost structure and supply chain complexity,” Gallagher explains.

Even when companies are motivated to build in the U.S., they face a long runway. A large-scale facility, even under ideal conditions, may take two to three years to develop.

“Constructing a new, large manufacturing facility is a complex and multifaceted process that, even under optimal conditions, spans 24 to 36 months,” he says.

On top of physical construction, manufacturers need to rethink the broader business model — including how they source, ship, and distribute their products.

“Bringing production back to the U.S. requires careful consideration of sourcing, logistics and distribution strategies to ensure long-term efficiency and resilience.”

That’s why, Gallagher says, companies are reluctant to invest without long-term policy consistency and predictability. The temporary nature of trade policies — or the possibility they could be reversed by a future administration — creates hesitation.

“When companies make decisions to invest capital, they want a level of certainty and predictability, not volatility, uncertainty, complexity and ambiguity.”

“Strategic decisions like this require stability, long-term visibility and confidence in both the economic and political landscape.”

This environment of instability makes it difficult for manufacturers to justify reshoring major operations, even if the market potential is strong.

“Most manufacturers who play the long game with their capital — even with the allure of getting access to the world’s richest market — may be hesitant to commit to significant, multi-year investments in this environment.”

Tariffs, Gallagher acknowledges, are intended to nudge companies toward domestic production. But without additional support, he says, their effect will likely be limited.

“While the intent behind tariffs is to promote domestic manufacturing, the practical challenges and economic realities suggest that a significant resurgence in U.S. manufacturing will be challenging.”

Rather than jump into reshoring, companies are taking a cautious, strategic approach.

“Companies will plan with intentionality and clarity — evaluating how reshoring fits within their broader operational strategies.”

“It’s a complex decision that involves balancing risk, cost and opportunity.”

Gallagher stresses that reshoring isn’t something that happens overnight or within a single administration’s first few months.

“Reshoring manufacturing to the United States is not a sprint that unfolds over the first 100 days of any given administration. It’s a marathon that requires long-term commitment, strategic foresight and consistent support from both the public and private sectors.”

Tariffs may serve as a spark, but sustained progress demands more robust and coordinated action.

“The Trump administration’s policies serve as a positive catalyst for reshoring and renewed manufacturing investment, but it’s important to recognize that the initial wave of activity will likely occur on a more modest scale.”

“While tariffs and political rhetoric may spark movement, they alone are not enough for a sustained manufacturing revival.”

Gallagher believes a successful reshoring strategy must pair trade tools like tariffs with deeper, structural support: tax competitiveness, regulatory streamlining, and a focus on next-generation manufacturing capability.

“What’s needed is a more comprehensive industrial strategy pairing targeted tariffs with strong economic incentives such as competitive corporate tax rates and streamlined regulatory and permitting processes.”

He also calls for more attention to modernizing supply chains, training the workforce, and advancing manufacturing technologies.

“Tackling key enablers — like modernizing supply chains, investing in workforce development and adopting advanced manufacturing technologies — will position the U.S. as a global leader in next-generation production.”

With the right mix of policy, investment and coordination, Gallagher believes the U.S. can lead a new era of industrial growth.

“With deliberate action and a unified vision, the U.S. has the opportunity to reclaim its leadership in global manufacturing — not just through tariffs, but through a holistic approach and focused execution.”

And he concludes with a call for long-term thinking.

“To successfully accelerate reshoring, we must go beyond tariffs. To attract continued foreign direct investment and drive sustained growth in U.S. manufacturing, a more encompassing strategy that looks beyond the next political or election cycle is essential.”

“It’s only through this type of considered, deliberate approach that America will achieve its next manufacturing miracle, one that will last far longer than the current political cycle.”

Originally reported by Brian Gallagher in Construction Dive.

News
May 12, 2025

Why Tariffs Alone Won’t Revive U.S. Manufacturing

Caroline Raffetto
Construction Industry
Arizona

While President Donald Trump’s tariff-driven strategy is intended to jumpstart a domestic manufacturing comeback, that effort can’t succeed in isolation, writes one construction industry executive.

Brian Gallagher, vice president of corporate development at the Oakbrook, Illinois-based contractor Graycor, argues that while tariffs may play a role in reshoring, they’re just one part of a much more complex puzzle.

“I’ll go out on a limb with what may be an unpopular sentiment at the moment: President Donald Trump’s economic policies and tariffs may very well help expedite the return of manufacturing to the U.S.,” Gallagher writes.

But he adds that tariffs, by themselves, aren’t enough to reverse decades of globalization. Despite encouraging signs — such as early investments in industries like steel, semiconductors, life sciences and automotive — Gallagher warns that a full manufacturing resurgence in the U.S. won’t happen quickly or easily.

“They won’t achieve that outcome in a vacuum,” he says.

Beneath the headlines announcing factory builds and reshoring efforts lies a difficult reality: Building domestic manufacturing capacity is an extensive, resource-intensive process. It involves more than just deciding to move operations — it requires overhauling supply chains, securing capital, and managing complex logistical challenges.

“Reshoring manufacturing involves complex, long-term decisions that require significant planning, capital and coordination,” Gallagher notes.

He emphasizes that the path to reshoring varies greatly by sector. For some manufacturers — particularly those dealing in high-volume, low-margin goods — overseas production remains more feasible.

“Reshoring isn’t a one-size-fits-all solution — its viability depends heavily on the industry, cost structure and supply chain complexity,” Gallagher explains.

Even when companies are motivated to build in the U.S., they face a long runway. A large-scale facility, even under ideal conditions, may take two to three years to develop.

“Constructing a new, large manufacturing facility is a complex and multifaceted process that, even under optimal conditions, spans 24 to 36 months,” he says.

On top of physical construction, manufacturers need to rethink the broader business model — including how they source, ship, and distribute their products.

“Bringing production back to the U.S. requires careful consideration of sourcing, logistics and distribution strategies to ensure long-term efficiency and resilience.”

That’s why, Gallagher says, companies are reluctant to invest without long-term policy consistency and predictability. The temporary nature of trade policies — or the possibility they could be reversed by a future administration — creates hesitation.

“When companies make decisions to invest capital, they want a level of certainty and predictability, not volatility, uncertainty, complexity and ambiguity.”

“Strategic decisions like this require stability, long-term visibility and confidence in both the economic and political landscape.”

This environment of instability makes it difficult for manufacturers to justify reshoring major operations, even if the market potential is strong.

“Most manufacturers who play the long game with their capital — even with the allure of getting access to the world’s richest market — may be hesitant to commit to significant, multi-year investments in this environment.”

Tariffs, Gallagher acknowledges, are intended to nudge companies toward domestic production. But without additional support, he says, their effect will likely be limited.

“While the intent behind tariffs is to promote domestic manufacturing, the practical challenges and economic realities suggest that a significant resurgence in U.S. manufacturing will be challenging.”

Rather than jump into reshoring, companies are taking a cautious, strategic approach.

“Companies will plan with intentionality and clarity — evaluating how reshoring fits within their broader operational strategies.”

“It’s a complex decision that involves balancing risk, cost and opportunity.”

Gallagher stresses that reshoring isn’t something that happens overnight or within a single administration’s first few months.

“Reshoring manufacturing to the United States is not a sprint that unfolds over the first 100 days of any given administration. It’s a marathon that requires long-term commitment, strategic foresight and consistent support from both the public and private sectors.”

Tariffs may serve as a spark, but sustained progress demands more robust and coordinated action.

“The Trump administration’s policies serve as a positive catalyst for reshoring and renewed manufacturing investment, but it’s important to recognize that the initial wave of activity will likely occur on a more modest scale.”

“While tariffs and political rhetoric may spark movement, they alone are not enough for a sustained manufacturing revival.”

Gallagher believes a successful reshoring strategy must pair trade tools like tariffs with deeper, structural support: tax competitiveness, regulatory streamlining, and a focus on next-generation manufacturing capability.

“What’s needed is a more comprehensive industrial strategy pairing targeted tariffs with strong economic incentives such as competitive corporate tax rates and streamlined regulatory and permitting processes.”

He also calls for more attention to modernizing supply chains, training the workforce, and advancing manufacturing technologies.

“Tackling key enablers — like modernizing supply chains, investing in workforce development and adopting advanced manufacturing technologies — will position the U.S. as a global leader in next-generation production.”

With the right mix of policy, investment and coordination, Gallagher believes the U.S. can lead a new era of industrial growth.

“With deliberate action and a unified vision, the U.S. has the opportunity to reclaim its leadership in global manufacturing — not just through tariffs, but through a holistic approach and focused execution.”

And he concludes with a call for long-term thinking.

“To successfully accelerate reshoring, we must go beyond tariffs. To attract continued foreign direct investment and drive sustained growth in U.S. manufacturing, a more encompassing strategy that looks beyond the next political or election cycle is essential.”

“It’s only through this type of considered, deliberate approach that America will achieve its next manufacturing miracle, one that will last far longer than the current political cycle.”

Originally reported by Brian Gallagher in Construction Dive.