New Report: U.S. Food Manufacturing Sees $15B Investment Boom but Tariffs and Labor Woes Threaten Growth

Global Location Strategies issues 2025 "Best Places for Food Manufacturing Insights Report," highlighting the top U.S. locations for the production of the food that fuels the U.S. economy

Tariffs, immigration crackdowns, and regulatory shifts pose threats to industry expansion

GREENVILLE, S.C., July 29, 2025 /PRNewswire/ -- Global Location Strategies (GLS), the world's leading location strategy and site selection advisory firm, today unveiled the 2025 edition of its Best Places For Food Manufacturing Insights Report, identifying the most competitive U.S. metropolitan regions for food manufacturing investment and highlighting the industry's evolving dynamics. Warner Robins, Georgia is ranked #1 of 387 metropolitan regions for U.S. food manufacturing.

The sector encompasses animal food manufacturing, grain and oilseed milling, sugar and confectionery product manufacturing, fruit and vegetable preserving, specialty food manufacturing, dairy product manufacturing, animal slaughtering and processing, seafood product preparation and packaging, bakeries and tortilla manufacturing, and other food manufacturing.

The report ranks 387 metropolitan areas based on a combination of location quality and operating costs and reflects the dramatic evolution of the industry in the wake of policy changes, labor disruptions, and continued investment.

"Choosing the right location for a food manufacturing operation is more strategic and risk-laden than ever before," said Didi Caldwell, President and CEO, Global Location Strategies. "Our data-driven approach helps business leaders find communities where they can thrive while future-proofing their investments."

Industry Highlights
The report sheds light on the robust growth of the U.S. food manufacturing industry, driven by significant trends:

• From 2023 to 2024, the U.S. food manufacturing sector attracted 154 new projects, totaling $15.3 billion in capital investment and generating 23,000 new jobs.
  • In 2023, 64 projects were recorded, and in 2024, this increased to 90 projects. Looking at data over the past decade, the 2023 project count was the lowest in the last 10 years, but the 90 projects in 2024 represent a healthy rebound in activity.
  • Although there were fewer projects in 2023, they were larger on average in terms of capital expenditures (CapEx) and jobs created per project, with the highest average CapEx and jobs per project in the past 10 years.
  • The average project impact was $99 million in capital investment and 149 jobs per project.
  • Fruits/Vegetables and Specialty food investments led the industry's growth, recording 19 new projects in 2024, and creating 4,800 new positions.
  • Sector wages rose 23% since the pandemic, now averaging $59,873/year, outpacing general manufacturing (21% growth).
  • Wage increases slowed to 4% over the past two years, suggesting a potential stabilization after several years of intense upward pressure.
• Top food manufacturing investment sectors in 2025:
  • Dairy Products: $3.3B (22% of total capital inflow)
  • Fruits & Vegetables / Specialty Foods: $2.5B (17%)
  • These two sectors accounted for over 32% of all food manufacturing projects.
  • In a noticeable shift, boutique operators are investing more in vertically integrated manufacturing, from making the product to getting it into customers' hands, so they can offer more specialized goods and services.
• Warner Robins, GA is the #1 metro area for food manufacturing in the U.S.
  • The region jumped 11 spots due to strong demographic trends, labor force growth, and rising industry competitiveness.
  • The metro area recorded 8.7% year-over-year job growth in food manufacturing, driven by two specific industry groups: animal slaughtering and processing and snack food manufacturing.
  • The most recent growth in these industries has been driven by Frito-Lay and Jack Link's Beef Jerky, which announced projects in 2020 and 2022, resulting in nearly 1,000 new jobs and a $650 million investment.

Growth Trends by Industry Subsector
Notable employment growth has occurred in the following industry subsectors since prior to the Covid-19 pandemic.

• Animal Food Manufacturing leads long-term growth (+17%), driven by rising demand for premium pet food.
• Bakeries & Tortilla Manufacturing (+11%) and Dairy Products (+9%) also show strong performance.
• Seafood Product Manufacturing is the only subsector in decline (-9% since pre-pandemic levels).

While project activity in animal slaughtering has slowed, the sector still accounts for 30% of industry employment, or roughly 550,000 jobs, and added 21,500 jobs post-pandemic.

Challenges: Labor, Tariffs and Regulation

Labor Lurch

• Despite a slight uptick in the unemployment rate (4.0% in 2025), food manufacturing continues to rely heavily on immigrant labor (12.7% of agricultural workers and 5.4% of manufacturing workers are undocumented).
• In the short term, deportations of undocumented immigrants and visa restrictions could lead to widespread job vacancies, rising wages, and inflation.
• In the long run, these policies could stifle economic growth by shrinking the workforce, particularly in industries like food manufacturing, which rely heavily on immigrant labor.
• This trend could potentially affect 700,000+ undocumented manufacturing workers and 250,000+ agricultural workers.

Tariff Tumult

• The share of imports in total food consumption rose from 13.5% in 2013 to 17.3% by 2022, according to USDA data, heightening exposure to trade disruptions, tariffs, and geopolitical tensions.
• While tariffs impact the industry broadly, certain categories are particularly import-dependent such as grain and oilseed milling products, fruits and tree nuts, sweeteners, vegetables and melons, and sugar and confections—with import shares ranging from 35% to over 50%.
• Canada and Mexico supply large shares of U.S. grain, sugar, livestock, fruits, and vegetables, with Mexico alone providing more than half of all fresh-vegetable imports. Any tariffs applied to these imports would almost certainly increase raw materials costs for U.S. food producers using imported ingredients.
• The increase in steel and aluminum tariffs is further complicating capital planning. These materials are essential for food packaging (e.g., cans, foil) and construction of new facilities. For manufacturers investing in new plants and those producing shelf-stable or canned goods, this could mean millions in added material and equipment costs.

Regulatory Rigmarole

• The U.S. food industry is navigating major regulatory shifts, including new definitions for "healthy" labeling and additive bans, including Red Dye No. 3 and Brominated Vegetable Oil.
• The Make America Healthy Again (MAHA) initiative, launched in 2025, is expected to introduce stricter rules on food composition, labeling, and ingredient safety.
• For example, under the new 2025 FDA regulations, for a product to be labeled "healthy," it must contain a meaningful portion of at least one key food group (fruits, vegetables, protein, dairy, or grains) and adhere to strict limits on saturated fat, sodium, and added sugars. This change means that previously qualified products, such as fortified white bread, highly sweetened yogurts, and sugary cereals, may no longer meet the new standard. These changes are driving operational changes, requiring companies to reformulate products, source new ingredients, and increase investment in R&D and technical talent.

Ranking the Best Regions & Metro Areas

GLS evaluated metros based on more than 100 "quality" factors such as demographics, workforce, infrastructure, education, regulatory environment, industry ecosystem, quality of life, and "cost factors," such as utilities, lease, and effective tax rate.

The most significant location-dependent cost drivers for food manufacturers are typically proximity to raw materials and customers, labor costs, and utility costs. Taxes, incentives, and lease costs may vary significantly from location to location and may differentiate the most competitive locations from one another. According to project specifications assumed for this ranking, labor remains the largest cost component at 57% of location-dependent costs, followed by utilities (19%), leases (13%), and taxes (11%).

This comprehensive analysis highlights metro areas best positioned to support the food industry's growth. The full methodology is incorporated within the report.

Regional Highlights

#1 Region: East North Central (IL, IN, MI, OH, WI)

• Key subsectors: Fruits & Vegetables, Dairy, Animal Food, and Snack Food products.
• Attracted 25% of all U.S. food manufacturing projects.
• Green Bay, WI ranked #11 nationally; Lafayette-West Lafayette, IN; Wausau, WI; and Fort Wayne, IN are also ranked in the top 25.

#2 Region: South Atlantic (GA, NC, SC, VA, FL)

• Leads the U.S. in foreign direct investment (FDI) from Asia-Pacific and Europe, particularly in Dairy Products and Coffee/Tea.
• Added 3 new "preferred" metros and remains the region with the most top-performing metros.
• Warner Robins, GA is the #1 ranked metro area in the United States. Savannah, GA (#2) and Winston-Salem, NC (#4) also anchor the region's rise.

#3 Region: West North Central (IA, MN, NE, MO)

• Key subsectors: Grains & Oilseed, Animal Food, Dairy, and Bakeries.
• Kansas City, MO-KS (#6) and Fargo, ND-MN (#15) are top-performing metros.

Metro Area Rankings: Top Five

1. Warner Robins, GA (+11)
2. Savannah, GA (-1)
3. Huntsville, AL (-1)
4. Winston-Salem, NC (+6)
5. Clarksville, TN-KY (+14)

Notable Markets On The Rise
Driven by a variety of factors, which include a combination of better performance in key demographics and workforce categories, and a change in the number of counties, the following regions made significant strides in food manufacturing in this year's report:

• Hinesville, GA (+167)
• Ft. Smith, AR (+125)
• Bloomington, IL (+113)
• Iowa City, IA (+94)

Download the Full Report
The full 2025 GLS Food Manufacturing Report, including metro-level dashboards and regional breakouts, is available at: www.globallocationstrategies.com/reports

About Global Location Strategies
Founded in 2008, GLS is a leading location strategy, site selection advisory, and incentive negotiation firm specializing in industrial projects. Combining data-driven insights with comprehensive on-the-ground assessments, GLS supports clients in high-growth sectors in making informed decisions that drive sustainable economic development and long-term success. GLS is a premier location advisory partner to primary metals manufacturers and is poised to support companies navigating the tariff and other uncertainties in the U.S. and globally. For more information, please visit www.globallocationstrategies.com.

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SOURCE Global Location Strategies