When the Biden administration launched its White House Council on Supply Chain Resilience in November 2023, it came with lofty promises and audacious goals.
The Council’s inaugural meeting resulted in nearly 30 proposed actions to strengthen the domestic supply chain. From programs to test and improve logistics and material availability to investments in critical industries, the far-reaching plans impact nearly every U.S. industry.
It may seem overly ambitious to jump into dozens of action items, but the plan is to share the tasks amongst governmental, private, and academic organizations. With so many agencies working together, the hope is to find long-term answers to complex supply chain problems.
The Council’s goal is simple: improve and maintain the American supply chain to withstand future problems.
Global supply chains have been reeling thanks to several disruptions, including the COVID-19 pandemic, the ongoing war in Ukraine, and rising tensions with large-scale manufacturing countries like China. The Council brings together high-ranking cabinet members from President Joe Biden’s administration and critical governmental agency directors to find creative solutions to ongoing and potential issues.
During its first meeting, Council members were tasked with improving the supply chain, including in critical areas like medicine, food, and clean energy. But what are some of these action items, and how are they expected to improve the American manufacturing, shipping, and buying experience?
Other programs unveiled during the meeting cover everything from defense supply chain mapping and climate change research to developing initiatives to deliver essential goods and services to Americans during emergencies.
In most cases, these long-term projects will try to accomplish two things: shorten lead times and supply chains for critical products and mutually benefit our international partners with more trade opportunities.
We’ve seen how quickly supply chain disruption can affect the system. Improving it, even slightly, could make a world of difference.
Fixing the supply chain is a monumental task but well worth it for the government, the private sector, and consumers. A better U.S. supply chain network means shorter shipping routes, faster production of goods, and lower shipping costs. That also means more domestic manufacturing jobs, including in hard-hit areas where those jobs left decades ago and weren’t replaced.
Those communities could also benefit from new or revitalized manufacturing plants making products for emerging industries like clean energy and semiconductors. And as with any new investment, there’s always the hope for more steady, high-paying jobs in specialized fields.
Beyond simply having more jobs available, more manufacturing sets the stage for economic growth, less reliance on foreign-made goods, and helps private companies meet stricter rules targeting American-made products. It also allows American companies to further invest in innovation, technology, risk management, and security to boost productivity.
While better supply chains and more domestic manufacturing sound fantastic, there are concerns that could make achieving these goals harder.
Rome wasn’t built in a day – and neither will a vibrant and successful supply chain. President Biden’s initiatives will take years or longer to bear fruit. They will also rely on future administrations to keep the initiatives going. If a drastically different administration comes in, the Council and its projects could be shelved or dissolved.
Regardless of future administrations, there’s no way to avoid the sheer cost of improving the supply chain. Everything costs money, from investments in innovative technology to analyze risk and bolster logistical networks to the millions of dollars needed to build or retrofit old factories. Government entities and private companies must find ways to work together, split costs, and work quickly to get the job done.
And while bringing more manufacturing home makes for shorter supply chains, it comes at the expense of economies in other countries. When jobs return to the U.S., other countries may see higher unemployment and lower wages. This likely will not happen overnight but could result in an economic downturn if enough jobs leave.
Moving manufacturing back to the U.S. could also create geopolitical tension, as some countries miss out on export trade. As a result, they could lose global market share to the United States. Responses from impacted countries could come in the form of higher tariffs. Meanwhile, countries specializing in materials used to make products will benefit from more trade with the U.S.
Finally, even if the money is available and more jobs are added to the U.S. economy, the global supply chain will still be disrupted in the short term. This could lead to delays and shortages while the new supply chain is rebuilt, and consumers may have to navigate higher prices for products and materials.
There are many moving parts, but the U.S. can bring manufacturing jobs home, tighten the supply chain, and support strong ties with the global community.
But the move must be made sooner rather than later, especially given the constraints placed on the global supply chain by COVID-19, ongoing wars, and constantly changing partnerships between countries. Moving more manufacturing to the U.S. removes several variables from the equation, giving American companies more control over their production and logistics. Unfortunately, it doesn’t happen without a concerted effort between the government, private industry, and academia.
We’re seeing the wheels moving toward more streamlined and efficient supply chains. The question now is when and how they take shape.
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