Will Nuovo Pasta’s pesto sauce taste the same if the Stratford company has to substitute American basil for herbs grown in Italy? Will a Connecticut electronics factory be able to expand if tariffs double the cost of tools from China that aren’t made anywhere else?
Those are the questions Connecticut Chief Manufacturing Officer Paul Lavoie has been fielding the past week as businesses calculate the impact of President Trump’s new tariffs.
“Manufacturers are concerned,” Lavoie said. “The administration policies on tariffs are designed to create manufacturing jobs and manufacturing opportunities, but you can’t do it in a vacuum like it’s being done now.”
Due to years of off-shoring and outsourcing, the nation’s manufacturing capacity has been reduced and it will take years to build the factories and workforce needed, Lavoie said.
“You shouldn’t put tariffs on products without putting catalyst capital in the marketplace to increase the capacity to make products here, and that hasn’t been done,” Lavoie said. If the tariffs aren’t moderated, he added, “what it’s going to do is it’s going to crush small- to medium-sized manufacturers.”
Even with the recent turmoil, Lavoie said Connecticut manufacturing could serve as a model of modernization and innovation as companies seek to re-shore production. He spoke at an event on Tuesday celebrating collaborations to bring new Connecticut-made products to the market.
FORGE, a nonprofit that helps “hard-tech” entrepreneurs scale up, handed out grant checks to startups at the event, held at Gyre9’s 40,000-square-foot contract manufacturing space in Southbury. AtlasXomics, a New Haven company that designed a tissue-analyzing device used in drug design, won a $70,000 grant as part of FORGE’s Product Development Funding Program. Woodbridge-based SedMed won $50,000 to help develop its hydraulic toilet lift.
Programs like FORGE and the state’s Manufacturing Innovation Fund are why Connecticut could help model re-shoring of manufacturing on a national scale, Lavoie said. Due to a range of initiatives and boom times at Electric Boat, the state’s manufacturing sector was growing 5% a year prior to Trump’s tariffs. Manufacturing’s share of the state’s economy grew from 10% in 2022 to 12.6% this year, representing $2 billion in increased revenues, Lavoie added.
Even with the new tariffs, Connecticut’s defense manufacturing sector, which mainly relies on domestic supply chains, could also see growth opportunities as Trump promises to boost the military budget to $1 trillion next year, Lavoie said.
“We have all the right contacts with all the right people in Washington, D.C., to be able to say, ‘Hey, Connecticut has the workforce. Connecticut has the supply chain. Connecticut has the skills to make more submarines,’” Lavoie said. “If you’re going to put money anywhere, put it into Connecticut so we can help the rest of the nation.”
One caveat for Trump’s team: Growth in manufacturing doesn’t necessarily mean dramatic growth in jobs due to productivity gains and modern technology, Lavoie said. With changes in immigration policy, manufacturers are also losing access to the new Americans who powered explosive manufacturing growth in prior decades, he added.
Connecticut’s response to its long-time labor woes can help inform national policy as immigration declines, Lavoie said. “We’re never going to have enough people. But the only way for us to do it, and to do it in a cost-effective way, is to drive innovation,” he said.
Connecticut’s deep pool of technical and research talent could help propel the state into the front ranks of re-shoring destinations despite high energy and labor costs, said Gyre9 President Ed Gilchrest.
“We have more opportunities than ever here, people wanting to bring stuff back into the U.S.,” Gilchrest said. “It should be done in Connecticut.”
© American Military News