Inside the US Government's Landmark Supply Chain Review

In what marks a significant step in addressing supply chain vulnerabilities and fostering economic security, the Biden-Harris Administration has released its first-ever Quadrennial Supply Chain Review.
The review outlines governmental initiatives designed to mitigate supply chain risks, alleviate bottlenecks and enhance overall efficiency – in particular pertaining to semiconductor manufacturing and supply. According to the White House, these efforts are integral to safeguarding jobs and supporting community development across the US.
Gina Raimondo, US Secretary of Commerce, explains the administration’s priorities: "Strengthening supply chains and revitalising America’s position in semiconductor manufacturing has been a cornerstone of the Biden-Harris Administration’s agenda from the very beginning.
"This review underscores our commitment to partnering with industry to proactively address supply chain challenges, develop innovative solutions, mitigate future disruptions and bring back American manufacturing.
"By working together, we are bolstering economic and national security and building supply chains that can meet the demands of tomorrow – particularly in critical sectors like information and communications technology and semiconductors."
The SCALE risk assessment
A significant feature introduced by the US Department of Commerce (DOC) as part of the review is the SCALE supply chain risk assessment tool.
Developed by the DOC's Supply Chain Center, the tool uses more than 40 indicators to evaluate risks and vulnerabilities across the US goods economy.
SCALE provides a detailed framework for identifying weaknesses in supply chains, enabling targeted measures to enhance resilience. The DOC emphasises that public-private partnerships are essential for effective coordination and long-term solutions.
The findings indicate substantial structural risks across industries, with many relying heavily on inputs from other high-risk sectors.
Key findings and strategic priorities
The Quadrennial Supply Chain Review reveals several key challenges, including:
- Structural risks across industries: Most US goods industries face significant exposure to structural supply chain risks, with nearly every sector scoring highly in at least one risk category.
- Limited import diversification: Approximately 38% of industries rely on single-country-sourced products and more than half demonstrate minimal diversification for critical inputs. This is particularly pronounced in electronics, chemicals and transportation, which are flagged as high-risk industries.
- Dependence on high-risk inputs: More than 86% of industries are linked to medium-high or high-risk suppliers, underlining interdependencies within the US goods economy.
These aforementioned risks are compounded by a lack of diversification, with specific reliance on countries like China for high-import industries.
Government-led initiatives driving change
The US government's landmark supply chain review highlights several initiatives aimed at building supply chain resilience.
These include:
- CHIPS and Science Act: Allocates US$52bn to strengthen semiconductor manufacturing and address global competition.
- Broadband Equity, Access and Deployment (BEAD) Program: Expands broadband infrastructure to underserved areas.
- Tech Hubs programme: Promotes regional innovation and workforce development.
- Public Wireless Supply Chain Innovation Fund: Supports secure and innovative wireless networks.
Since the administration began, private investments in semiconductor and electronics manufacturing have exceeded US$450bn, driven by public policies and incentives.
Addressing semiconductor production challenges
Crucially, the review underscores the urgency of tackling semiconductor supply chain risks.
According to the Congressional Research Service, East Asia accounts for the overwhelming majority (>90%) of advanced semiconductor production, with Taiwan Semiconductor Manufacturing Company (TSMC) alone responsible for more than half.
US market share in semiconductor manufacturing has plummeted from 37% in 1990 to just 12% in 2020, according to the Semiconductor Industry Association. The CHIPS Act seeks to reverse this decline and bolster domestic capacity.
Analysis by McKinsey & Company indicates that supply chain diversification could reduce reliance on high-risk regions by 25%, though significant investment and coordination are necessary. Similarly, experts at the Peterson Institute for International Economics stress the importance of policy alignment, infrastructure improvements and workforce training to ensure successful reshoring efforts.
The DOC plans to continue refining its approach to supply chain resilience, with policies aimed at fostering long-term stability. While the effectiveness of these initiatives remains to be seen, the administration stresses its commitment to collaboration and innovation.
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