Electronic Component Manufacturers NAICS 334416, 334417, 334419

May 5, 2025 - Some Electronic Products Exempted From Tariffs

• Some electronics products imported to the US have been exempted from President Trump’s reciprocal tariffs, according to US Customs and Border Protection. Profit margins of electronic component manufacturers may be compressed if tariffs are applied to imported manufacturing inputs in the future. The exemption, which comes after the Trump administration imposed a minimum tariff rate of 145% on Chinese goods imported to the US, does not include the 20% tariff on Chinese goods for the country’s alleged role in the fentanyl trade. Various electronic parts are among the exempted products. The exemption applies to products entering the US or removed from warehouses as early as April 5.
• Electronic component manufacturers benefiting from reshoring may also benefit from nearshoring, according to the Reshoring Initiative (RI). Harry Moser, founder of RI, says that if a product is so labor intensive that you can’t bring it to the US, then companies are sometimes surprised to find that wages in Mexico are far lower than in China. The average Mexican manufacturing worker earns $4 an hour, while the rate in China — where wages have been gaining 10% to 15% a year — is currently around $7, and in the US, it’s roughly $23. Products coming from Mexico end up with an average 40% US content, while in China they have 5% US content.

• Management consulting firm McKinsey has projected a shortage of 90,000 skilled technicians in the US by 2030. Electronic component manufacturers may struggle to fill open positions as a result. McKinsey expects demand for technology skills to rise 20% above 2019 levels (based on hours) by 2030. Many firms are struggling on three fronts: talent acquisition, retention, and organizational health, according to McKinsey. Companies need to respond by getting a strategic grip on the challenge and creating career offerings at least as attractive as those of tech giants that have been more successful on these fronts.
• Electronic component shipments have rebounded from a pandemic-era dip and remain above pre-pandemic levels, according to the US Census Bureau. Electronic component prices decreased slightly during the first 11 months of 2024, according to the US Bureau of Labor Statistics (BLS). Electronic component manufacturing industry employment and average wages for nonsupervisory employees increased slightly during the first month of 2025, according to the BLS. New orders for electronic components began rising at the start of the coronavirus pandemic and remain above pre-pandemic levels.