What it is
Reshoring, also known as onshoring, is the process by which a company brings manufacturing or other business operations back to its country of origin after having previously moved them abroad. For instance, a U.S. company that had its factories in China might decide to move them back to the United States. This decision is often motivated by a desire to reduce supply chain risks, improve quality control, shorten lead times, respond faster to market changes, or benefit from government incentives.
Reshoring is a significant trend influenced by factors such as geopolitical risks, trade wars, rising overseas labor costs, and the desire for greater supply chain control. Governments may encourage reshoring through tax incentives or subsidies to boost domestic employment and industrial capacity, particularly for critical goods like rare earth elements. This shift can lead to new factory construction and job creation in the home country, impacting real estate, labor markets, and the stock performance of companies investing in domestic production.
Why it matters
Reshoring can strengthen domestic economies, reduce supply chain vulnerabilities, and boost long-term stability for companies. It may also lead to higher domestic employment.
Reviewed under editorial standardsUpdated September 26, 2026Not investment advice