The return of local manufacturing can strengthen resilience, but only if work is decent

The return of local manufacturing can strengthen resilience, but only if work is decent | Photo: ThisisEngineering

Published on 20 June 2026 at 08:12 GMT

By Editorial Team SDG8

Local manufacturing is returning to public debate because recent shocks have exposed how fragile distant and highly specialised supply chains can be. Pandemic disruption, geopolitical tension, climate-related disasters and energy price volatility have all shown that production systems built only for low cost can struggle when transport, inputs or labour markets are interrupted. The question is no longer whether global trade should be replaced by local production. It is whether shorter supply chains, regional workshops and strategic manufacturing can make economies more resilient while improving the quality of work.

The practical case for regional production begins with risk. Many countries discovered during recent crises that essential goods, from medical equipment to semiconductors and food packaging, depended on faraway suppliers, long shipping routes and concentrated production hubs. This does not mean that every country can or should manufacture everything. It does mean that governments, businesses and communities are reassessing which goods are essential, which skills have been lost, and where local capacity can provide a buffer when global systems come under pressure.

A more balanced model of production would combine international trade with stronger domestic and regional ecosystems. In this model, shorter supply chains are not a retreat from the world economy. They are a form of risk management. Local firms may not always compete with the lowest-cost global producer, but they can offer speed, repairability, accountability and adaptation to local needs. This matters for hospitals, schools, public transport, housing, energy systems and other sectors where delays can have direct social consequences.

The labour question is central. Manufacturing has often been discussed in terms of output, productivity and national competitiveness, but its social value depends heavily on job quality. The International Labour Organization has long argued that decent work requires rights, social protection, dialogue and fair conditions, including across supply chains. A local factory or workshop is not automatically better than an overseas one. Poor wages, insecure contracts, unsafe conditions and exclusion can exist in any production system. The return of local manufacturing only supports decent work if labour standards are designed into it from the start.

That includes training. Many regions that once had strong manufacturing bases have lost technical colleges, apprenticeship routes and intergenerational craft knowledge. Rebuilding production capacity therefore requires more than subsidies or procurement contracts. It needs investment in vocational education, small-business support, digital fabrication, worker safety, and pathways for women, migrants, disabled people and young people into skilled jobs. Without that social infrastructure, local manufacturing risks becoming a slogan rather than a development strategy.

The strongest opportunities may lie in the circular economy. Repair, refurbishment, remanufacturing and reuse are labour-intensive activities that often work best close to consumers. A broken washing machine, school laptop or bicycle does not need a global logistics chain to be useful again. It needs spare parts, diagnostic skills, accessible repair services and product design that allows components to be replaced. The Ellen MacArthur Foundation defines circularity around keeping products and materials in use through maintenance, reuse, refurbishment, remanufacture and recycling. That approach can support local workshops while reducing waste and material demand.

Repair also changes the idea of value. In a linear economy, profit is often tied to selling more new goods. In a circular economy, value can come from extending product life, recovering components and providing services. This could create neighbourhood repair hubs, regional remanufacturing centres and specialised craft businesses linked to textiles, electronics, furniture, construction materials and mobility. However, repair will not scale fairly unless consumers can access affordable services, workers are trained and protected, and manufacturers make spare parts and manuals available.

The environmental case is important but should not be overstated. Local production can reduce some transport emissions and waste, especially for bulky or repairable goods. Yet proximity alone does not guarantee sustainability. A nearby factory powered by fossil fuels and using inefficient processes may be more polluting than a distant producer using cleaner energy and high material efficiency. The real test is whether sustainable industrialisation combines lower-carbon energy, efficient design, responsible sourcing, waste reduction and decent labour standards.

This is where public policy matters. Governments can shape markets through procurement, standards and industrial strategy. Public buyers can support durable, repairable and locally serviceable products for schools, hospitals, public buildings and transport systems. Standards can require safety, interoperability and access to parts. Industrial policy can support strategic sectors, including renewable energy components, public health supplies, low-carbon construction materials and essential digital infrastructure. The United Nations Industrial Development Organization links industrial development to SDG 9, which calls for resilient infrastructure, inclusive and sustainable industrialisation and innovation.

The SDG connection is direct but complex. SDG 8 (decent work and economic growth) is relevant because manufacturing can create skilled employment, but only when rights and fair conditions are protected. SDG 9 (industry, innovation and infrastructure) applies because resilient production capacity can help communities respond to shocks. SDG 12 (responsible consumption and production) matters because repair, reuse and remanufacturing reduce pressure on raw materials. These goals are connected, but they can also conflict if industrial expansion increases pollution or if green jobs are insecure and poorly paid.

Local manufacturing also raises questions of equity between countries. A wealthy country that reshapes supply chains only to protect its own industries may weaken opportunities for workers in lower-income exporting countries. A practical approach should avoid a narrow nationalism that treats foreign workers as disposable. Instead, resilience should mean diversification, fairer trade relationships, regional cooperation and stronger labour protections across borders. The OECD has warned that resilience depends on agile and adaptable supply chains, not simply relocalisation.

For communities, the appeal of local workshops is often tangible. They can turn vacant industrial spaces into productive sites, keep spending in the local economy, and connect consumers with the people who make or repair goods. In rural areas and smaller cities, regional production can support livelihoods that are not dependent on commuting to metropolitan service jobs. In urban neighbourhoods, maker spaces and repair centres can provide practical training and small enterprise opportunities. The challenge is to make these models financially durable rather than dependent on short-term grants.

Craft is part of this story, but it should not be romanticised. Skilled craft production can preserve cultural knowledge, support tourism and create high-quality goods, yet craft workers often face low and irregular incomes. The policy question is how to connect craft with modern markets without stripping it of value or turning it into precarious gig work. Cooperatives, shared equipment, local procurement and fair digital marketplaces can help, especially when combined with legal protections and business training.

Strategic industries require a different lens. Products such as medical supplies, energy equipment, water infrastructure components and critical digital technologies may need public planning because market forces alone do not account for emergency preparedness. Regional production of these goods can reduce dependence on single suppliers, but it can also be expensive. Governments therefore need clear criteria for what counts as strategic, how public money is used, and how benefits are shared with workers and communities.

There are also risks. Local content rules can raise costs if they are poorly designed. Subsidies can favour large firms while excluding small producers. Automation can increase output without creating many jobs. Environmental claims can be used to justify protectionism without reducing emissions. Local manufacturing can also reproduce inequality if training, finance and contracts are captured by already advantaged groups. A serious strategy must therefore include transparency, worker voice, community consultation and measurable social outcomes.

Civil society has a role in keeping the debate grounded. Organisations such as Repair Café International show how repair culture can build practical skills and reduce waste at community level. Labour organisations and watchdogs can monitor job quality. Environmental groups can scrutinise whether circular economy claims are real. Development institutions can help ensure that industrial resilience does not become a cover for excluding poorer economies from markets.

The return of local manufacturing is best understood as a selective rebuilding of capability. It is not a promise that every town will regain the factories it lost, nor a guarantee that every local product is ethical or green. Its value lies in creating production systems that are closer to social needs, easier to repair, less exposed to disruption and more accountable to workers and communities.

A resilient economy needs more than warehouses and shipping contracts. It needs people who can make, maintain and adapt the things society depends on. If shorter supply chains are built around decent work, circular design and public-interest industrial policy, local manufacturing can become more than a nostalgic idea. It can become part of a fairer and more practical response to instability.

further information:

* International Labour Organization, its work on supply chains is relevant because it focuses on labour rights, social dialogue and decent work across national, regional and global production systems. https://www.ilo.org/topics-and-sectors/supply-chains

* United Nations Industrial Development Organization, its industrial development work is relevant because it connects manufacturing, resilience, innovation and inclusive economic development under SDG 9. https://www.unido.org/

* OECD, its supply chain resilience analysis is relevant because it examines the policy trade-offs between diversification, relocalisation, economic security and global trade. https://www.oecd.org/en/publications/2025/06/oecd-supply-chain-resilience-review_9930d256.html

* Ellen MacArthur Foundation, its circular economy work is relevant because it explains how maintenance, reuse, refurbishment, remanufacturing and recycling can keep materials in productive use. https://www.ellenmacarthurfoundation.org/topics/circular-economy-introduction/overview

* Repair Café International, its community repair network is relevant because it shows how practical repair skills can reduce waste and support local resilience. https://www.repaircafe.org/en/