Machine Shops NAICS 332710

Sep 18, 2025 - Paying for Performance

• How do you grow a company, hire skilled workers, and pay off debt all at the same time? That question is on the minds of many small business owners today, including the CEO and co-founder of a family-owned prototype machines shop in New Mexico with 11 employees that brings in a little more than $2 million annually and is carrying over $1.6 million in debt. In an environment where it's becoming increasingly difficult to find, hire, and retain skilled workers, owners have no choice but to pay them what they’re worth or lose them to other shops. Personal finance expert Dave Ramsey told the shop owner who called his EntreLeadership podcast that paying fair, competitive wages is a non-negotiable part of business, even for companies burdened with debt. “If the new hire can bring in more value than they cost,” Ramsey said, “then they’re worth it.”
• As suppliers to US manufacturers, machine shops benefit from new manufacturing activity created by reshoring and foreign direct investment. Last year, the US manufacturing sector generated 244,000 new jobs as a result of reshoring and FDI activity, according to the Reshoring Initiative’s 2024 Annual Report. The report found that reshoring by US-based businesses exceeded foreign direct investment by the largest margin recorded to date in 2024. The vast majority of new jobs (90%) created by reshoring belong to high- or medium-tech manufacturing sectors, while low-tech industrial jobs remain “under-reshored,” per the report. Industries leading reshoring activity in 2024 were computer and electronics, electrical equipment (including EV batteries and solar), and transportation equipment, with Texas, South Carolina, and Mississippi the top states for reshored operations. Tariffs are rising as motivation for reshoring decisions – up by 454% in 2025 over 2024 – the Reshoring Initiative reports.

• While President Trump promises tariffs will be a boon for American manufacturing, in the short term, at least, tariffs are making life harder for US manufacturers, the National Association of Manufacturers reports. The president of Ohio-based copper wire products maker Republic Wire told the Cincinnati Enquirer that while he understands what the administration is trying to achieve with tariffs, “Higher prices on materials could mean fewer construction projects, which could mean a slowdown for the industry, fewer jobs and a drag on the economy as a whole.” Chuck Daras, president and COO of Michigan automotive manufacturing firm AlphaUSA, wrote in an op-ed “The truth [about tariffs] is that the burden falls squarely on American manufacturers and, ultimately, the American consumer,” adding “If the tariffs remain in place long term, small manufacturers might not be able to hold out long enough to see their promised benefit.”
• Producer prices for machine shops rose 2.8% in August compared to a year ago after rising 1.3% in the previous August-versus-August annual comparison, according to the latest US Bureau of Labor Statistics data. Industry producer prices, which have been rising steadily since mid-2021, were near their all-time high in August. Employment by machine shops shrank 2.3% year over year in July, while the average industry wage rose by 3% over the same period to a new high of $28.28 per hour, BLS data show. Machine shops have been raising wages to attract and retain skilled workers amid the skilled labor shortage in the US manufacturing sector.