Page 53 - FDI Alliance International Magazine Summer 2020 Digital Interactive Issue

The pandemic exposed weaknesses in the U.S. The bottom line is this, entrepreneurs are seeing a time of growth, diversification, and innovation
supply chain and has prompted some business a crop of new opportunities available in the U.S. for U.S. industry.
to streamline and reshore operations. New market. They grew up being inspired by Gates,
domestic sourcing will fuel the growth of a Jobs and now Bezos and Musk -there is a new What does this mean for economic developers
larger American Middle Market and create an urgency to be part of industry and commerce, and and investment promotion professionals, most
economy that looks more like the U.S. economy not just stand on the sidelines. Entrepreneurialism likely a change in priorities.
of the 1980’s, when there was more U.S. is mainstream in American culture. Bolstered
manufacturing and many more Middle Market by our strong North American market of 330 With more home-grown companies starting to
companies. million people in America, 37 million people emerge, I expect there will be a greater emphasis
in Canada and 127 million people in Mexico, put on business retention and expansion efforts
Globalization is going to take a hit from global and automated manufacturing which makes and export promotion. Equally, I think American
political tensions and COVID, as countries employment costs less burdensome. Coupled economic development agencies will focus
around the world mirror the American surge in with a heightened demand for goods, Made in more on attracting foreign direct investment.
self-reliance, although the retraction will be more America makes more sense to entrepreneurs Remember, between Canada, the U.S. and
severe in the United States. The U.S. has long now, than it has in decades. It is cool to be an Mexico, we have almost a half a billion people
held the distinction of being the largest producer industrialist again, and the timing is right. and immense buying power. North America
of foreign direct investment in the world, and is in a good position to attract foreign direct
most economists agree that globalization and U.S. Middle Market companies are the economic investment as foreign companies want to access
foreign direct investment flows will be negatively engine of the U.S. economy. Much like their North American populations.
impacted by the pandemic. Most likely there will counterparts around the world, they are typically The net of all of this is that post-pandemic, some
be a dip in U.S. outbound FDI that will last for a sole proprietorships, family owned enterprises. American companies will reshore operations.
period of 3 to 5 years. The prediction here is that the U.S. economy There will be a new crop of American Middle
will shift slightly and start to mirror its German Market industrial companies emerging, American
In the meantime, U.S. Middle Market companies, counterpart, with a rise in the Mittlestand. supply chains will be increasingly sourced in
inspired by demand and stories of industrialists North America and we will see a resurgence
like Elon Musk, will take their shot at the American The Middle Market is going to drive the U.S. of “Made in America” products. Outbound
Dream. When we think that Tesla officially economy and drive pandemic recovery. It is also American foreign direct investment will be down,
launched in 2003 and now manufactures over going to drive the emergence of a new crop of but inbound FDI will increase.
365,000 cars per year, the company’s trajectory global brands, and not just in the technology
from obscurity to becoming one of the world’s sector, but in heavy industry. The Middle Market is The landscape is going to change and expect a
most powerful brands has been accomplished the largest component of the U.S. economy and wave of innovation, and a new crop of companies.
at warp speed. In just 17 years, Tesla has it will continue to be the most important building It is going to be a time of change in the investment
transformed the automotive industry. block of the American economic engine. It will be promotion industry.

→ SHIRAR O’CONNOR Senior Vice President, UNDERPINNED

Shirar O’Connor is an economic development professional with over 28
years of experience working with national, regional, and local governments NEW YORK OFFICE
from around the world. She is the Vice President of Marketing for AdvanceCT +1 646 496 7668
and a founding partner of Underpinned, a New York-based marketing
firm specializing in foreign direct investment and business retention and shirar@underpinnedinc.com
expansion services. Shirar O’Connor-Mugler
For more information about Underpinned, visit www.underpinnedinc.com .

53. FDI ALLIANCE INTERNATIONAL