A Trump administration goal in imposing tariffs on many foreign-made goods was to encourage some manufacturers to relocate in the United States, a process known as “onshoring.”
Trends show onshoring is underway, but not without its challenges. The recent immigration raid on a Hyundai plant near Savannah, Ga., illustrates a conflict between two White House policy goals.
About $2.1 billion in state and local incentives went into attracting the $7.6 billion plant. Korean workers were hired – some without documentation, some under short-term visas – for specialized set-up work. There were complaints those should be American jobs, but skilled U.S. citizens proved harder to find as Hyundai tried to keep construction on schedule.
The result: A U.S. Immigration and Customs Enforcement, or ICE, raid that rounded up many workers and set back the date “Made in U.S.A” production can commence.
Tariffs are complicated taxes on foreign-made goods that can have a ripple effect on the economy, from supply chains to trucking to prices U.S. consumers pay for items that were much cheaper only months ago.
Debate over whether tariffs will bring back the hallowed days of American “factory towns” or unleash a new set of economic troubles continues, especially in states such as Wisconsin, where manufacturing traditions run deep.
One such discussion will take place Sept. 16 in Madison at a noon forum produced by WisPolitics.com with help from the Wisconsin Technology Council. It will feature Menzie Chinn, a professor in UW-Madison’s La Follette School of Public Affairs who studies macroeconomics; veteran farm broadcaster Pam Jahnke, who directs the Mid-West Farm Report Network; Buckley Brinkman, who leads the Wisconsin Center for Manufacturing and Productivity; and Roberta Oldenburg, director of business development for science and technology at Findorff Construction.
The line-up for the forum, to be held at The Madison Club, speaks to the downwind effects of tariffs: From favorable breezes to storm clouds, and from manufacturing to agriculture to construction.
The automotive industry in Wisconsin is one example. According to data from the Alliance for Automotive Innovation and IBISWorld, it contributed $15.2 billion to the gross state product in 2024. Under the Trump tariffs, most of the world’s car-making and parts-supply countries are subject to double-digit tariffs. Will auto-related companies in Wisconsin absorb the higher costs that will come with those tariffs?
Another example is the state’s farm economy. In 2024, Wisconsin exported nearly $4 billion in agricultural products such as soybeans and dairy products. China, Mexico, and Canada account for more than half of those two exports. Retaliatory tariffs from these countries are making Wisconsin’s products more expensive and driving business to other nations such as Brazil, in the case of soybeans.
A flip side on the tariffs debate is foreign direct investment by nations such as Japan, Canada, Germany and the United Kingdom. Companies such as Kikkoman, which opened its first U.S. production plant in Walworth in 1972, continues to thrive in Wisconsin. Toshiba America Energy Systems Corp., Komatsu Mining Technologies, Yaskawa America Inc. and IRIS USA are among other Japanese companies with Wisconsin facilities.
Envoys from Japan and Canada, to cite two examples, have visited Wisconsin of late to remind public officials and private leaders alike they are the state’s major trade partners.
Leaders at the Wisconsin Economic Development Corp. are also mindful of changing dynamics in the related worlds of imports, exports and foreign direct investment. They organized a recent trade mission to Japan and missions to Canada, Mexico and Germany are being formed.
Other than the Hyundai plant in Georgia, what signs point to more onshoring of manufacturing?
For starters, that company alone has announced plans for $26 billion in total U.S. investment by 2028, assuming the Georgia raid doesn’t leave a lasting hangover. Analysts such as Goldman Sachs predict a 2.5% increase in U.S. energy demand by 2030. While much is tied to data centers, the return of critical manufacturing to America for semiconductors, EV batteries and more is also a big part of the power picture.
The effects of tariffs on the U.S. and Wisconsin economies depends on who’s asked, but no one is pretending conflicts will simply go away.
Tom Still is president of the Wisconsin Technology Council.
