Driven by government incentives and advances in technology, U.S. manufacturing is experiencing a historic resurgence, positioning both established and emerging metros as prime locations for manufacturing growth. And Phoenix ranked 3rd among the top 20 U.S. metros for manufacturing, according to analysis.

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CommercialSearch’s newest study compared the country’s 100 largest metropolitan statistical areas by total industrial manufacturing space based on three sets of indicators: manufacturing space inventory, manufacturing indicators and costs, and logistics infrastructure. We then highlighted the 20 best performers which show the most promise amid the resurgence of manufacturing.

Phoenix ranked 3rd among the top 20 U.S. metros for manufacturing with a total of 51 points and strong performances across several metrics.

  • From 2019 through 2023, Phoenix increased its manufacturing space inventory by 11.4%, which was the highest such percentage growth in the ranking. This translates into over 6.5 million square foot of manufacturing space added during this period which is the 2nd-highest in the ranking.
  • The over 10.5 million square feet manufacturing space currently under construction in Phoenix constitute the largest pipeline among the top 20 entries.
  • Phoenix has the largest share of modern manufacturing stock on the list, with 30.2% of its total manufacturing space being taken up by properties completed starting January 1st, 2000.
  • With 15 public airports located here, metro Phoenix is home to the 3rd-most airports in the top 20.
  • At a regional level, a total of 2 Western MSAs placed among the top 20 U.S. metros for manufacturing. Besides Phoenix, there was Los Angeles which came 5th.
  • At a national level, Midwestern metros made up half of the top 20’s entries while the podium was made up of Dallas at #1, Chicago at #2 and Phoenix at #3.

1. Dallas MSA

Racking up a total of almost 55 points with great showings across the board, Dallas-Fort Worth is the #1 best metro for manufacturing in the U.S. While logistics and distribution, corporate services, healthcare and information technology are industries that normally come to mind when analyzing the Metroplex’s economic backdrop, manufacturing is a Dallas-Fort Worth centerpiece — and that may ring even more true in the near future.

That’s because Texas is the largest exporter of manufactured goods among all U.S. states and second only to California in factory production. Additionally, Dallas-Fort Worth concentrates much of the Lone Star State’s manufacturing capabilities. The rising significance of manufacturing in DFW is evidenced by the fact that 9.2 million square feet of manufacturing space was delivered here in the last five years alone for the largest expansion in the U.S., ahead of Phoenix’s 6.5 million and Chicago’s 4.7 million.

Still, it's worth noting that the Dallas Fed’s Manufacturing Outlook Survey painted a picture of ups and downs for manufacturing in the state in the last year, manifesting in slowing production and dropping business activity. However, these difficulties may simply be temporary blips as the state moves toward advanced manufacturing and absorbs new projects, as investors are still betting big on the potential rewards of nearshoring in the state. Moreover, Dallas is particularly poised to profit from the trend with several high-profile companies — like Siemens, Ballard Power Systems and GlobiTech — joining local chip giant Texas Instruments in expanding their production capabilities in the metro. And, with no fewer than 17 public airports in the metro — the highest number of all of the cities in the study — supply chain logistics are another contributing factor to Dallas-Fort Worth’s first-place finish.

2. Chicago MSA

Chicago ranks as the second-best metro for manufacturing in the U.S., boasting a huge inventory of industrial manufacturing space as well as the infrastructure and talent to keep them running. The metro is home to the largest manufacturing inventory nationwide at 226.4 million square feet, which is 40 million ahead of Los Angeles and 60 million more than Dallas-Fort Worth.

Beyond scoring top marks for this indicator, Chicago is also home to the second-largest workforce employed in production occupations with almost 287,000 such jobs in the metro. Its status as the Midwest’s foremost logistics hub is also evident through the fact that Chicago has the third-most miles of roadways servicing the metro at more than 4,800. And, while Chicago had strong showings in other metrics as well, its status as a complete manufacturing center is already evident from these three alone.

Granted, as one of the most storied manufacturing centers in the U.S., Chicago’s strong finish is to be expected. Light manufacturing — including pharmaceuticals, food processing, apparel and more — always stood alongside the local steel industry throughout its history. Although offshoring in the last few decades has challenged the sector considerably, recent supply chain issues are now leading companies to reevaluate the significance of local production. Similarly, government initiatives like Made in Chicago are also aimed at sustaining and developing the place that manufacturing holds in the local economy and securing its position among the foremost production centers in the U.S.

3. Phoenix MSA

Semiconductor factories are at the cutting edge of manufacturing, requiring ample developable space in greenfield locations. Thus, this requirement has placed Phoenix high on the list of expanding semiconductor makers, given the Valley of the Sun’s sprawl.

For example, after an initial Phoenix-area investment of $12 billion in 2020, chip mammoth Taiwan Semiconductor Company (TSMC) began construction of a second facility in early 2023, tripling its investment. Now, a third fabrication plant has been announced in conjunction with $6.6 billion in direct CHIPS Act funding, bringing TSMC’s total investment in Phoenix to more than $65 billion. In parallel with TSMC’s developments, Intel also moved to benefit from federal funding with a considerable expansion of its Phoenix facilities. As a result, Phoenix stands to become one of the foremost chip manufacturing hubs in the entire country. That includes the production of leading-edge, 2-nanometer technology chips, which are the most advanced type currently available which were previously only made overseas.

It's not just chipmakers driving manufacturing in the Valley of the Sun, though. Rather, the industry as a whole has experienced explosive growth in recent years, with the metro receiving top marks in three different categories in our study. More precisely, Phoenix has (1) the largest share of modern manufacturing stock out of its total (30.2%), (2) the largest percentage growth of manufacturing space in the last five years (11.4%), as well as (3) the largest new stock currently under construction (10.5 million square feet). These metrics highlight Phoenix as a rising star in the industry, despite a relatively undersized current manufacturing inventory of 64.3 million square feet.

4. Detroit MSA

Perhaps no metro area has experienced as many manufacturing-led highs and lows as Detroit. From the early copper smelting and railroad car building industries to the famous automotive and armament industries, manufacturing has been the industry defining Detroit for much of its history. Even so, since the hardships brought on by the decline of the local automotive industry, the metro has struggled to redefine itself, best evidenced by its 2013 bankruptcy filing. However, Motown has since been making strides toward urban renewal to become one of the former Rust Belt’s success stories.

Detroit’s biggest win when it comes to our ranking is part of its manufacturing heritage. In particular, the metro boasts the second-largest manufacturing space inventory at 192.2 million square feet, representing more than half of the metro’s total industrial space. Of course, much of that space is lower-tier and in need of renovation, with just 11.6% of current manufacturing stock being constructed since the year 2000. Still, Detroit’s considerable inventory can provide opportunities for renovation, redevelopment or affordability for growth-phase companies. What’s more, the shift to advanced manufacturing is still congruent with Detroit’s automotive history, with EV battery company Fortescue choosing the metro as the location of its first advanced manufacturing center in the U.S.

Other metrics where Detroit had strong showings included industrial manufacturing space added between 2019 and 2023 (3.6 million square feet for fourth in the top 20) and employment in production occupations (185,200 for fifth in the top 20).

5. Los Angeles MSA

Compared to the previous entries on the list, Los Angeles has considerably sparser greenfield developable space in low-density areas that's necessary for sprawling advanced manufacturing plants. However, LA’s huge array of economic sectors and its diverse, well-educated workforce also provide a boon for Southern California manufacturing.

Los Angeles scored top marks for its 17,600 manufacturing companies and establishments — the largest concentration of any U.S. metro area and ahead of New York metro’s 15,800 and Chicago’s 11,800. Additionally, Greater Los Angeles also has the largest workforce employed in production occupations as defined by the Bureau of Labor Statistics.

The high level of manufacturing business diversity as well as strong sector employment stand testament to the health and growth of the manufacturing sector in Los Angeles. From aeronautics parts to musical instruments and from furniture to satellites, the metro produces a wide array of goods even as space for new fabrication plants is hard to come by.