MYTH #2

MANUFACTURING MYTH SERIES

The Myth of the Hollowed-Out Economy

Offshoring gutted U.S. manufacturing — nothing is made here anymore

REALITY

The U.S. is the #2 manufacturer in the world — and the mix has shifted toward high-value production

PICTURED HERE:

Manufacturing USA Network map showing all 17 institutes across the United States. Credit: NIST

The Stereotype

The story is familiar: factories closed, those jobs went overseas, and the U.S. stopped making things. This narrative has shaped political debates, driven economic policy, and molded public perception for two decades. It’s also very incomplete.

 

The Reality

The United States is the second-largest manufacturer in the world by output, behind only China. U.S. manufacturing value-added exceeded $2.84 trillion in 2023. What changed was not whether America makes things — but what it makes.

 

How the Mix Is Shifting

The Manufacturing USA network represents a deliberate national strategy to lead in the advanced manufacturing sectors that matter most:

  • Semiconductors and photonics: AIM Photonics (Rochester/Albany, NY) operate out of the shared foundry facilities of the Albany NanoTech Complex (ANC), and the Test, Assembly and Packaging (TAP) facility in Rochester, NY. The ANC is the U.S.’ largest and most advanced semiconductor R&D facility. TAP is the first open access facility focused on advanced photonics packaging, and PIC prototyping.
  • Biopharmaceuticals and regenerative medicine: NIIMBL (Newark, DE) and BioFabUSA (Manchester, NH) are building the domestic biopharma and cell-based manufacturing capabilities needed to ensure lifesaving therapies are produced in America, at scale. BioFabUSA’s de-risking approach has attracted more than $3B to its collaborating innovators.
  • Defense-critical materials and systems: LIFT (Detroit, MI) signed a new $49.4M DOD cooperative agreement in 2023. BioMADE unlocked a $50M co-investment in Minnesota for a demonstration-scale bioindustrial manufacturing facility that will produce materials critical to commercial and defense supply chains.
  • Advanced electronics and sensors: NextFlex (San Jose, CA) produced vital-sign monitoring devices now integrated into the Army’s battlefield trauma system — made in America, for American warfighters.

Why the Myth Is Dangerous

When the public and policymakers believe manufacturing is gone, investment follows the belief. The infrastructure deteriorates, the workforce pipeline shrinks, and the country becomes more dependent on foreign production for critical goods — exactly the vulnerability exposed during the COVID-19 pandemic and ongoing supply chain disruptions.

The Manufacturing USA network’s 17 institutes, with 2,900+ member organizations across all 50 states, are proof of what coordinated public-private investment can accomplish. America continues to produce important things. The challenge is the commitment to continue to make these investments.

U.S. manufacturing value-added: $2.84 trillion (2023). Manufacturing accounts for 54% of U.S. private sector R&D investment. Manufacturing USA network: 929 active R&D projects in FY2023. Source: NIST AMS 600-19, NSB Science & Engineering Indicators 2024.