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2020 Coronavirus’ Impacts on North American Manufacturers

Thomas’ May/June 2020 COVID-19 Manufacturing Survey (with 746 qualified manufacturing respondents) reveals the following four key trends:

  1. Stronger Reshoring Interest: Two in three manufacturers (69%) indicate they are ‘likely’ to ‘extremely likely’ to reshore (up from 54% in February), with Agricultural, Energy/Utilities and Food & Beverage leading in interest.
  2. The Need for Skilled Labor and Apprenticeships: One in three (38%) companies surveyed are actively hiring. Industries engaged in apprenticeship programs were less impacted by the lack of skilled labor.
  3. North America Is Confident in Automation: Over half of the respondents feel that they meet or exceed industry standards on automation processes.
  4. Digital Marketing Transformation Is No Longer Optional: Marketing avenues identified as ‘extremely important’ to attract new customers: website (84%), email (73%), and a surge on virtual events, such as webinars (from 15% to 32% post-COVID-19).

Companies Remain Optimistic About Future: Although COVID-19 impacts are undeniable (90%), 91% of respondents believe that North American manufacturing can recover from the pandemic.

Key Insights

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  1. Reshoring Trends

and Insights

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Increased Interest in Reshoring: 69% of Manufacturers Indicate �They Are Likely to Extremely Likely to Reshore in Future

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Significant Reshoring Interest Across All Industries

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2%

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Manufacturing Communities Stepping Up in Time of Crisis

  • “I think this pandemic has caused a refocus of where we get raw materials, products, and services. In a twinkling of an eye we can lose our connection with companies abroad. Doing more business domestically will force our nation to revisit labor rates which was a big driver at companies looking abroad.”
  • “The increased communication between industry peers and across industries has been encouraging, [and has] inspired learning and support.”
  • “We not only source our materials from the U.S., we source most of them locally in Michigan, which makes it a little easy to navigate supply chain issues… We also hire almost exclusively from competitive high school robotics teams.”
  • “I was SO impressed by manufacturers who made adaptations to their lines and went from making cars to making ventilators or from making craft beer to making hand sanitizer or from making designer clothes to making face masks.”

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Top Manufacturing Products and Services Needed in North America Due to Growing Appetite for Reshoring

*Survey participants are able to choose more than one answer. Therefore, total percentages may exceed 100%.

Percentage = Count of Responses/Total Respondents

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“Other” includes:

Sewn materials, apparel, hardware, printing, and casting.

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A Boomerang Effect on Manufacturers Affected by COVID-19

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Optimistic Outlook - 91% Believe Recovery Is Possible

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Manufacturers’ Outlook on North American Manufacturing

  • “We need to reshore manufacturing and supply. It will increase high paying, skilled jobs, and create an exponential number of support jobs.”
  • “Sufficient technology exists today to allow for remote working and production automation to accommodate new changes for workplace standards.”
  • “This event has prepared us for this response in the future. Being prepared is 95% of the outcome.”
  • “The impact has been severe and recovery will take many years, but over time manufacturing will get back to pre-coronavirus levels. One tailwind will be the transition of the supply chain to North America from Asia which will boost manufacturing and logistics capabilities.”
  • “Dealing with a crisis is never easy, but it will also force you to come up with outside-the-box solutions and grow stronger as an organization.”
  • “The impact of COVID-19 was a wakeup call about preparedness, market-positioning, and operations for many less established. Those lessons will likely redistribute business, vectorally diversifying the market, encouraging more sustainable operations, increased collaboration, and inter-regional referrals.”
  • “We will recover but will take months to years to get back the revenue lost during this time.”

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II. The Need for Skilled Labor and Apprenticeships

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38% of Surveyed Companies Are Actively Hiring

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26% of Surveyed Companies Have Apprenticeship Programs;

More Than Half of Those Programs Emerged Unscathed by COVID-19

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“Other” includes: increasing the program, restarting the program, and remote or online work.

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Industries with Higher Apprenticeship Adoption Rate Are Less Affected by the Lack of Skilled Labor

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Industry Feedback on Apprenticeships

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  • “We have a unique culture, so it is imperative that employees are mentored into their roles within our company.”
  • “Our interns are mainly working remotely.”
  • “[We are] using online classes and programs so that they can continue their apprenticeship during the semi-shutdown at our facility.”

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III. Innovation Acceleration:

Automation and Technology

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North America Feels Confident in Automation - A Majority Identified as Meeting or Exceeding Industry Standards Across All Processes

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Automation - Future Outlook: Technologies Manufacturers

Are Most Interested To Invest In For The Next 12 Months

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The Impact of Automation in Times of Crisis

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  • “[Automation] will allow for employees to more effectively use their time completing high value process work, while the lower value and higher time-consuming processes are automated.”
  • “We have used AR to avoid sending technicians to customers in infected areas.”
  • “Automation has helped us to meet the ever increasing shorter deadlines within the entertainment industry. 15 years ago our lead times were 6-8 weeks and longer.”
  • “COVID-19 was an eye opener for us about the position and rate of adoption of automation in businesses similar to ours across the nation.”
  • “Robotic systems give us more productivity and zero rejects. Faster product assembly for an increase of finished products by 25%.”
  • “We have been updating our processes, equipment, and software for years and found as a result that all but the shop floor can efficiently work remotely, keeping any work in progress moving forward and potential jobs available for estimating completed on time.”

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The Rapid Acceleration of Digital Marketing for Industry

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*Survey participants are able to choose more than one answer. Therefore, total percentages may exceed 100%.

Percentage = Count of Responses/Total Respondents

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Challenges with the Cancellation of Trade Shows

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  • “We are emphasizing webinars right now when customers want to know more about a product, but look forward to getting back to trade shows and business travel when it appears safe to do so. We are also engaging our outside sales reps in social media more. Since they have spent less time on the road they have more screen time and have been good about sharing which increases our exposure exponentially.”
  • “Additional phone calls, virtual visits, social media, email blasts.”
  • “It is pretty bleak actually. We have been calling and sending emails but it is not producing results.”
  • “Case studies and articles published in trade magazines.”
  • “Our products are very hands-on. Without trade shows it will be challenging.”
  • “A more proactive initiative to reach out to the very healthy database of existing clients we already have. Reaching out and engaging the procurement departments on a more personal level and [on a] regular basis.”
  • “Pivoting from B2B to consumer markets.”

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2020 Coronavirus’ Impacts on North American Manufacturers

Thomas provides the industry with relevant and timely information, like this report, through surveys and the immense real-time data we collect on Thomasnet.com® from over a million industry sourcing professionals who source on our platform daily.

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If you’re interested in future opportunities to contribute, please visit https://business.thomasnet.com/join-survey-panel or click the button below to sign up for the Thomas Industrial Survey Panel. You’ll be invited to join future surveys, webinars, and discussions with other thought leaders in your community regarding industry-specific subject matter and industrial talking points.

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Join Our Expert Survey Panel

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Discussion

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Free Resources �from Thomas

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Learn More:

Thomasnet.com/COVID19

Thomas COVID-19 Response System

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Over 3,000 North American suppliers signed up to expedite the delivery of critical supplies and services.

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Learn More:

https://business.thomasnet.com/tmx

Thomas Industrial

Data

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Built with North America’s largest anonymized industrial sourcing dataset, TMX is one of most powerful financial and economic forward indicators to date.

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Methodology &

Firmographics

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2020 Coronavirus’ Impacts on North American Manufacturers

This Thomas Industrial Survey was conducted over a 22-day period from May 26 - June 17, 2020.

A total of 958 respondents participated and 746 responses qualified for the survey.

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INVITED PARTICIPANTS:

  • Qualifiers:
    • Complete, non-duplicate entry
    • Required to work in the manufacturing or industrial sector in North America
  • Recruitment:
    • Respondents were invited to participate via Thomas email. The invitation pool was incentivized with a copy of this report.

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RESPONDENT’S FIRMOGRAPHICS:

  • Revenue: Business revenues span from less than $4.9 million to over $500 million
  • Employees: Company size spans from less than 100 to more than 1,500 employees
  • Business Descriptor: The majority of the respondents identify as custom manufacturers and OEMs
  • Headquarters Location: Identified by state/province

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SURVEY INFORMATION:

Methodology

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Respondents Are from Variety of Industries

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Respondents Are Mostly Custom Manufacturers and OEMs

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Company Size by Number of Employees

Employee range

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Company Size by Annual Gross Revenue

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2020 Coronavirus’ Impacts on North American Manufacturers

Rita Lieberman

Director, Marketing Communications

Thomas

5 Penn Plaza

New York, New York 10001

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Email: rlieberman@thomasnet.com

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Contact

Information

Report Produced By:

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Cathy Ma, Director, User Acquisition

Mariah Hauck, Content Marketing Specialist

David Matava, Associate Creative Director

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Since 1898, Thomas has served as North America’s leading industrial sourcing platform and marketing powerhouse. We serve professionals on both sides of the industrial buying process to create solutions that inform, support, and empower industry.

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