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4 MIN. READ
From smartphones to smart grids, electronics are the backbone of modern life—and business. Whether it’s powering homes, automating factories, or enabling AI breakthroughs, the U.S. electronic and electrical equipment industry is foundational to our economy and innovation. Today, we're exploring key trends shaping the industry, including vital facts and statistics on this essential industry based on exclusive data collected by MNI.
According to MNI’s survey of all U.S. electronics manufacturers, there are currently 12,808 electronics and electrical equipment facilities in operation today, employing 1.1 million workers and reporting annual average sales of $1.8 trillion. MNI data finds electronics manufacturers are major exporters, with 56% of companies distributing their products internationally, as compared to 29% for U.S. manufacturing as a whole. 23% import raw materials.
If you watch the stock markets, you might expect many of the companies in this segment to be publicly traded. You would be right. As opposed to 5% for manufacturing as a whole, 12% of electronics and electrical equipment organizations trade publicly.
2% of U.S. electronics manufacturers or 288 companies are women-owned, while 2% or 212 are minority-owned, reports MNI.
While you’ll see many other industries concentrate in one geographic area, this segment is pretty evenly distributed, with:
• 27% in the South.
• 27% in the West.
• 25% in the Midwest.
• 22% in the Northeast.
With electronic and electrical equipment encompassing everything from cellphones to lighting, you might wish to focus your sales and marketing efforts on a particular subindustry sector. These sectors include:
● Electric motors and generators.
● Transformers.
● Carbon and graphite products.
● Batteries.
● Electronic capacitors.
● Electronic resistors.
● Electronic connectors.
These subindustries serve utilities, factories, retail markets and construction. They also fill many needs of the automotive industry. Recent events caused many pain points for these manufacturers, opening new doors to prospecting.
Reach 12,000+ companies and 36,000+ executives in the U.S. electronics industry with the Electronics & Other Electrical Equipment Industrial Database, only from MNI. Need a different industry? Explore all of our databases by region, industry, executive, niche market, and more.
The U.S. electronics sector in 2025 continues to operate within a complex economic environment. Let's explore some of the latest trends impacting the sector.
The implementation of new tariffs, particularly on imports originating from major trading partners such as China, Canada, and Mexico, poses a substantial threat to the U.S. electronics sector. The imposition of increased tariffs on critical components and raw materials would likely translate directly into higher production costs for domestic manufacturers, potentially leading to price increases for consumers and significant disruptions in established global supply chains.
Analysis of market data from early 2025 reveals a discernible upward trend in the price of various electronic components. Key components that have experienced notable price increases include resistors, capacitors, standard logic chips, transistors, and diodes.63 Furthermore, lead times for certain critical components are also showing indications of increasing, which could potentially lead to further complications and challenges within the already complex electronics supply chain.
Despite these economic headwinds, the semiconductor industry is forecasting a period of robust growth in 2025. This optimistic outlook is primarily driven by the surging global demand for advanced semiconductor chips, which are essential for powering the rapidly expanding field of AI applications, the increasing infrastructure demands of data centers, and the development of other cutting-edge emerging technologies. This strong projected demand could provide a significant and much-needed tailwind for the broader U.S. electronics sector.
Similarly, the cost of raw materials specifically used in the production of passive electronic components is also on the rise in early 2025. Several key metals, including ruthenium, copper, silver, aluminum, zinc, and tantalum, which are fundamental inputs for the manufacturing of these components, have experienced price increases. This increase in raw material costs will likely contribute to the overall cost pressures being faced by electronics manufacturers across the industry
The implementation of the CHIPS and Science Act continues to be a dominant force in the U.S. electronics sector in 2025. This ambitious legislation, designed to revitalize domestic semiconductor manufacturing, is demonstrably catalyzing substantial private investment and strategically reshaping the global semiconductor supply chain. Since the Act's introduction, over $540 billion in private investments have been announced across more than 100 projects spanning 28 states.
This considerable financial commitment from the industry underscores a strong belief in the long-term strategic importance of establishing a robust domestic semiconductor production capability. The widespread geographical distribution of these projects indicates a concerted national effort to rebuild this crucial manufacturing sector.
The Department of Commerce has played an active role in facilitating this change by allocating billions of dollars in grants and loans to a diverse array of companies. These funds are not solely directed towards establishing new, state-of-the-art fabrication plants but also towards the crucial modernization and expansion of existing facilities. The strategic focus of this funding extends beyond leading-edge chip production to encompass the manufacturing of mature and current-generation semiconductors, as well as vital components of the supply chain such as essential materials and specialized manufacturing equipment. This comprehensive approach aims to address the diverse needs of various downstream industries, ranging from national defense to consumer electronics.
Major players within the semiconductor industry, both domestically and internationally, including prominent companies like TSMC, Intel, Micron, and Samsung, are making significant commitments to building and expanding their manufacturing presence within the United States.1 For instance, TSMC's increased investment plans signal a substantial long-term commitment to the future of semiconductor manufacturing in the U.S.
Looking ahead, projections indicate that the United States is on a trajectory to significantly increase its share of the global production of leading-edge logic and DRAM chips by the end of the current decade and into the mid-2030s, rising from a negligible base of virtually zero in 2022. This anticipated surge in domestic production capacity represents a key objective of the CHIPS Act, aiming to substantially reduce the nation's reliance on foreign sources and significantly bolster its national security posture.
Beyond the critical area of chip fabrication, the CHIPS Act is also strategically fostering the development of a comprehensive and resilient domestic semiconductor ecosystem. This includes targeted investments in companies involved in the production of essential raw materials, the manufacturing of specialized equipment required for chip production, and the advancement of sophisticated advanced packaging technologies. Building this complete end-to-end supply chain within U.S. borders is considered crucial for ensuring long-term resilience against potential international disruptions and enhancing overall national security.
This ambitious undertaking is not without its potential headwinds and ongoing debates. The possibility of new tariffs being imposed on imported semiconductors, a measure proposed by some policymakers, could potentially undermine the intended benefits of the CHIPS Act. By increasing the cost of essential components for electronics manufacturers, such tariffs could ultimately lead to higher prices for consumers. This creates a complex interplay between policies aimed at bolstering domestic production and those that could inadvertently increase costs across the entire sector.
Concerns have also been voiced regarding the adequacy of the financial resources specifically allocated for research and development initiatives under the CHIPS Act. A robust and well-funded R&D pipeline is absolutely crucial for sustaining long-term innovation within the semiconductor industry, and questions surrounding the current funding levels could potentially impact the future competitiveness of the U.S. in this critical technological domain.
Some analyses also suggest that the uncapped tax credit component of the CHIPS Act might lead to significantly higher overall costs than were initially projected. This potential for budgetary overruns could lead to future scrutiny and debates regarding the long-term financial sustainability of the Act and its various provisions.
A report shows that 86% of electronics manufacturers worry about inflation.
Inflation continues to cast a long shadow over the U.S. electronics sector in 2025. Manufacturers are facing sustained increases in the cost of essential raw materials, including metals like ruthenium, copper, silver, and aluminum, which are crucial for passive components. Labor costs are also on the rise, with predictions of a 3.3 percent increase in 2025. These rising operational costs are putting pressure on profit margins and, ultimately, could lead to higher prices for consumers.
The potential for new tariffs on imported goods, particularly from major trading partners like China, Canada, and Mexico, adds another layer of complexity to the inflationary pressures. Analyses suggest that tariffs could significantly increase the cost of technology products and inputs, potentially leading to price hikes on everyday electronics like laptops, tablets, and smartphones. While some anticipate raw material pricing pressure to ease later in the year, the immediate future requires manufacturers to strategically manage these increasing costs.
As electronic devices evolve, most electronic components eventually go obsolete. If you’re prepared to sell a replacement part, the change won’t take you by surprise. You may even steal a march on your competitors by keeping up with lifecycle stages and aiming your line to fill new needs. Consider that:
● An in-production component may be available from a manufacturer but not yet from a distributor. If you’re a rep for that manufacturer, you’ll want to line up clients before distributor reps get the chance.
● Your product line may include components not recommended for new designs (NRND). If this is the case, you’ll want to make deals that will unload them as soon as possible.
● You may also find a component marked as obsolete even though it is temporarily still in production. By making this status clear to customers requiring it, particularly for replacement or repair, you may create an urgency for purchase.
● Your customers may want a component that is no longer in production. Potential purchasers will be overjoyed if you can provide a suitable replacement.
The more you know about your target industry’s lifecycles, the better sales strategies you can create.
Supply chain complexities remain a significant hurdle for the U.S. electronics sector in 2025. While the CHIPS and Science Act of 2022 is a major initiative aimed at bolstering domestic semiconductor production and enhancing supply chain resilience, the industry continues to navigate a global landscape fraught with potential disruptions. Geopolitical tensions, trade wars, and unforeseen global events can all impact the availability and flow of critical components.
In response to these vulnerabilities, a growing number of companies are exploring nearshoring strategies, bringing manufacturing closer to their primary markets in the U.S., Canada, and Mexico. This shift offers benefits such as easier communication, reduced shipping times, and greater responsiveness to local market demands. Furthermore, technologies like blockchain are being explored to enhance supply chain transparency and combat the issue of counterfeit electronic components. Despite the progress spurred by the CHIPS Act, which has already catalyzed significant private investments in domestic semiconductor manufacturing , the intricate nature of the global electronics supply chain demands continued vigilance and proactive risk management.
IPC, an international organization for electronics manufacturing, reported in 2022 that materials and labor costs are the major hurdles facing the electronics supply chain. Ninety percent of electronics manufacturers cite rising materials costs. Although orders remain strong, backlogs are growing while profits shrink. Prepare yourself and your team to deal with customer questions regarding pricing structure.
Are you looking to build your prospect list with contacts at electronic equipment manufacturers or electrical equipment fabricators? In these fast-moving industries, you need the most up-to-date information on company locations, positions and executive emails. An IndustrySelect subscription can provide these and the services you need to ride the wave of these developing markets. To learn more about using IndustrySelect to generate the reliable, high-quality leads you need, try a free demo of IndustrySelect, pre-loaded with 500 free leads to get you started!
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