Backshoring and improved key manufacturing resources in firms’ home location

Abstract

This research explores the influence on manufacturing backshoring of improved key´manufacturing resources in the home location of firms. Analysis of recent cases of backshoring in the European manufacturing industry shows that the production processes of firms that have backshored to their home location offer greater optimisation in terms of workforce, are more production assets intensive and have a higher technological level than when they offshored. The results highlight the relevance of internal factors in manufacturing backshoring analysis. This is of special interest from a production systems perspective because it is these internal factors that managers can control and therefore gain decision‐making power regarding the location of manufacturing activities. This study also contributes to the debate on how innovations and improvements in manufacturing processes could increase industrial production and employment in advanced economies.