How Virginia’s Manufacturing Sector is Thriving Despite Global Supply Challenges in 2024

The past few years have been tough for the global manufacturing industry. The COVID-19 pandemic, the trade wars, the climate crisis, and the contraction have all contributed to a series of supply chain disruptions, labor shortages, inflation pressures, and environmental challenges this year. Many manufacturers have struggled to keep up with the demand, maintain the quality, and stay profitable.


Aerial top view containers ship cargo business global supply chain logistic and transportation

But not all is doom and gloom. In fact, some regions have managed to overcome these obstacles and even thrive in the face of adversity. One of them is Virginia, the state that ranks second for business competitiveness in the country, according to a new CNBC analysis. In manufacturing, Virginia ranks a still-impressive eleventh according to the 2023 VMA Virginia MFG Competitiveness Report, based on 55 metrics across five categories: Business Climate, Workforce, Infrastructure, Innovation, and Economic Strength.

So, how did Virginia do it? What are the secrets behind its manufacturing success? And what can other manufacturers learn from its example?

This blog unpacks the three ways Virginia manufacturers handle global supply challenges:

  1. Federal Support and Incentives
  2. Skilled Workforce, Strategic Location, and Vibrant Business Community
  3. Incremental Innovation

1. Federal Support and Incentives

One of the key drivers of Virginia’s manufacturing growth has been the federal support and incentives the state has received in the past couple of years. In 2021, Congress passed three major bills that boosted the domestic manufacturing industry: the Infrastructure Investment and Jobs Act (IIJA), the Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act, and the Inflation Reduction Act (IRA).

Federal advising clients on their requests for legal proceedings

The trio of federal bills passed in 2021 brought in a windfall for the U.S. manufacturing industry, injecting billions in funds and tax incentives across sectors like semiconductors, clean energy, and electric vehicles. Virginia, in particular, saw a surge as big players like Intel and Tesla set up shop. This paved the way for thousands of jobs and created a ripple effect, boosting demand for local suppliers and stimulating the state’s economy.

2. Skilled Workforce, Strategic Location, and Vibrant Business Community

Virginia has a strong tradition of manufacturing excellence, dating back to colonial times. Today, it is home to 6,508 manufacturing companies and 15,513 executive contacts by name and title. 

skilled workforce getting their individual tasks done

Virginia has one of the nation’s most educated and diverse workforces, filled with STEM graduates, veterans, and immigrants. This workforce has plenty of end-to-end supply chain consulting in Virginia with programs like VEDP’s Supply Chain Optimization Program, explicitly designed to train and retain manufacturing personnel.

Apart from the talent pool, Virginia’s has a great geographical advantage. The state is easily accessible to major markets, has a strong transportation network, and proximity to vital ports and airports. But the secret sauce to Virginia’s success might be its innovative business community.

Here, a low tax average meets a stable political climate, creating an innovation and entrepreneurship environment. A network of universities, research centers, programs, and industry associations amplify this effect to provide resources and economic development for manufacturing companies.

3. Incremental Innovation

The third factor that has enabled Virginia’s manufacturing sector to thrive is the incremental innovation the manufacturers have implemented in response to the global supply challenges. 

programmer using laptop analyzing and developing in various information

Incremental innovation is the small but continuous improvements that manufacturers make to their products, processes, and business models without changing the core value proposition.

Some examples are:

  • Digital Transformation: Using A.I., IoT, and blockchain for streamlined operations and elevated customer service.
  • Reshoring: Shifting production back to the U.S. to mitigate overseas sourcing risks and leverage federal incentives.
  • Broadband Expansion: Investing in rural broadband for remote work, online education, telehealth, and e-commerce.
  • Product Innovation: Launching eco-friendly packaging, responsive sensors, and customizable furniture to meet evolving customer demands.

GENEDGE: Keeping Our Virginia Manufacturers Strong

As a catalyst to Virginia’s manufacturing success, GENEDGE delivers a mix of consulting services and resources to navigate global supply chain issues. Our versatile solutions, like the CONNEX Virginia (Matchmaker Platform), Cybersecurity, and Strategic Sourcing, sharpen industry understanding and decision-making. 

The GENEDGE Alliance further amplifies your business growth with resources like newsletters, podcasts, and self-paced online training. Let’s grab this opportunity and turn those global supply challenges on their head together! Request your first assessment.

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