American online marketplace removes US 500 companies, including Apple, Nike, Hasbro, and 68 others, due to their outsourced production processes, no longer considered manufacturers.
In the world of business, the landscape of manufacturing has undergone significant changes over the years. One such change is the evolution of the criteria used to measure the strength and impact of U.S. manufacturing companies.
The U.S. 500 list, which recognizes the largest publicly traded manufacturing companies in the country, has seen Apple take the top spot in both 2022 and 2021. Interestingly, Apple's primary revenues have not come from its own factories but from supplier-provided products throughout its high rankings.
A look back at 2002 paints a different picture, with Apple's revenues coming almost entirely from products made at its own facilities in California, Ireland, and Singapore. However, the company's reliance on outsourcing production has increased over the years, with its 2022 manufacturing primarily outsourced to partners in Asia.
This trend of outsourcing production is not unique to Apple. Companies like Nike, Hasbro, Scholastic, and Funko are examples of brands whose products are made by suppliers, not the companies whose names appear on the packaging.
The shift in manufacturing methodologies reflects a move away from simple output or employment figures towards more nuanced indicators of manufacturing strength and sustainability. The new criteria include detailed benchmarks against industry peers, reshoring metrics, productivity adjusted for quality changes, capital intensity, and R&D intensity.
These changes are evident in surveys like the Aprio 2025 U.S. Manufacturing and Distribution Survey, which uses data from past years and collaboration with research firms to provide critical insights for strategy improvements. New indices such as Kearney’s Reshoring Index also track reshoring and nearshoring efforts, providing a more fine-grained view of the sustainability and output capacity of U.S. manufacturing.
However, there is no clear public information on specific companies that were removed from measurement or benchmark lists in 2023. Reports focus more on sector-wide trends and methodological improvements rather than naming individual excluded companies.
Despite the shift towards outsourcing, domestic apparel production has shown some improvement. Inventory levels, which were down 84% to $800 million by late 2019, have risen slightly to $1.3 billion in March of this year. However, this figure is still a far cry from the $5.1 billion in inventory that U.S. apparel makers had in 2001.
In the semiconductor world, companies like Nvidia and Advanced Micro Devices have no fabrication plants, while companies like Micron, Intel, and Broadcom are doubling down on U.S. manufacturing. This trend is a testament to the importance of manufacturing in the U.S., even in industries where outsourcing was once common.
The changes in the U.S. 500 list criteria have led to the exclusion of 71 companies with a combined $887 billion in sales. These companies, which include several computer and high-tech companies, have been eliminated due to not manufacturing their own products.
Despite this, companies like U.S.-based Jabil Inc., which landed at No. 40 in the U.S. 500 list, continue to play a significant role in the manufacturing sector. Jabil, one of eight large contract manufacturers, had $54.5 billion in revenue and $1.8 billion in earnings in 2022.
In conclusion, the evolution of U.S. manufacturing measurement methodologies reflects a shift towards more nuanced indicators of manufacturing strength and sustainability. This shift highlights the trend towards outsourcing production, particularly in industries like technology and apparel, but also underscores the importance of manufacturing in the U.S. economy.
- The technology industry, like Apple, is increasingly relying on outsourced production for manufacturing, a trend that is also seen in other sectors such as sports apparel.
- Despite the outsourcing trend, indices like Kearney’s Reshoring Index highlight reshoring and nearshoring efforts in the tech sector, indicating a growing importance of local manufacturing in this industry.
