Reshoring manufacturing: the influence of industry 4.0, Covid-19, and made-in effects

Abstract

Empirical investigations of how the reshoring of manufacturing is affected by Industry 4.0 technologies, supply chain disruptions, and made-in effects are rare in the extant academic literature. This paper contains an empirical analysis of how these variables affect reshoring and reshoring intentions. Results from a 2022 questionnaire survey including 152 offshoring manufacturing firms show that reshoring and reshoring intentions are associated positively with investments in automation in manufacturing, and with employee made-in. Results also showed that while Covid-19 associated disruptions increased firms’ reshoring intentions equally across firm sizes, smaller and larger firms reacted quite differently towards more well-known disruption types: larger firms decreasing reshoring intentions with higher levels of uncertainty and smaller firms increasing reshoring intentions with higher levels of uncertainty. These results point to the importance of creating consciousness about the dynamics of production localization and how firm-level and situation-specific contingencies may interfere with Industry 4.0 technology-, supply chain disruption-, and made-in effects on strategic reshoring decisions.