Adapting to the new realities of US supply chain risk

US businesses and their supply chains are facing an unprecedented time of change. A shifting landscape marked by geopolitical changes and emerging sustainability risks is surfacing and exacerbating unique issues that are impacting how businesses manage supply chain risks and build resilience.

If it’s not shifting policies, it’s child labour issues in US factories. Then there are regulatory changes, the risks and trade-offs of domestic sourcing, tariff impacts, and now—helping suppliers navigate evolving immigration challenges.

This unique operating environment is creating hurdles for supply chain confidence, and businesses must start to understand the risks and opportunities that come with these changes to future proof against further disruptions. The good news is that with the right data and resources – achieving supply chain confidence is completely viable, no matter the landscape, but it’s time to adopt the right tools.

Made in America: As homeshoring increases, what are the key risk drivers?

As the current US administration pushes to reduce reliance on foreign trading partners and encourage ‘Made in America’ production, businesses will navigate a new and challenging risk profile for social and environmental risks from US suppliers. EiQ data, comprised of onsite audit data from 2024, shows critical issues such as forced labour, child labour, inhumane treatment, excessive working hours and workplace injuries all remain key risk drivers in the US and contribute to the country’s overall ‘high risk’ indicator.

EiQ risk heat map

Unaccompanied Minors Index

As homeshoring increases, domestic suppliers will also face added pressures to produce faster and in greater quantity to keep up with demand. This could lead to increased risk in longer working hours, subsequently increasing risks around health and safety. Child labour concerns also remain prevalent. The US Department of Labor found more than 4,000 children employed in violation of federal laws in 2024, with nearly 5,800 violations uncovered in 2023.

Insights from on-the-ground assessment experts suggest that issues related to foreign migrant workers and forced labour are likely to intensify under tighter immigration policies. As deportations rise and the domestic workforce shrinks, companies may become increasingly reliant on labour agencies to fill job vacancies. However, these third-party agencies have been linked to forced labour violations, such as withholding identity documents and imposing unlawful recruitment fees. Stricter immigration controls and heightened deportation rates also heighten risks around worker ID falsification and identity theft - problems already surfacing in some onsite assessments.

The data revolution: enhanced tools for risk assessment

Innovative risk assessment tools are emerging to help navigate this complex landscape. EiQ has implemented new risk indicators specific to US issues to adapt to this need. These indicators track risks subnationally for issues such as Unaccompanied Minors in the US and corresponding child labour risks, human trafficking risks and occupational safety and health risks based on civil society data:

The Unaccompanied Minors Index tracks vulnerability patterns among migrant children, considering factors like country of origin, release patterns and local support systems. Children from El Salvador, Guatemala, and Honduras face vulnerabilities due to violence and poverty in their home countries.
The Human Trafficking Index leverages data from the National Human Trafficking Hotline and FBI crime statistics to create state-level risk assessments. This granular approach allows companies to tailor their compliance programmes to specific geographic risk profiles rather than applying generic national standards.
Occupational Safety and Health Reports Indices provide state-by-state comparisons of workplace safety patterns, helping companies understand regional variations in enforcement and incident rates. This data-driven approach enables more targeted resource allocation and risk mitigation strategies.

See these indices in EiQ with a free demo/walk-through of the platform.

Adopting the right strategies for supply chain integrity

With these contextual factors in mind – what are the key takeaways? How will you adapt your responsible sourcing strategy to effectively respond? Our expert recommendations informed by our everyday client work with global brands, retailers and their suppliers include:

Adopt a more granular risk analysis and management strategy: A blanketed approach no longer cuts it. Risk management must be tailored and fit for purpose. This means understanding unique datapoints where risk exposure may be high and has potential for greater disruption.
Enhance supply chain mapping: Move beyond tier-one suppliers to understand sub-tier relationships. Primary data collection from suppliers remains essential, but must be supplemented with AI-driven risk analytics that can identify potential vulnerabilities before they become crises.
Think beyond audit: Standard audits have historically been viewed as a sufficient measure of supplier. This mindset is now outdated. We need the beyond-audit data points, we need the risk insights, we need the granular worker voice data. We need auditors to go in not just with what they know, but with publicly sourced information or risk analytics in their pockets so that they can be pre-warned of the potential issues on site. Develop focused audit tools that specifically address vulnerabilities identified through risk indices and geographic analysis. This shift in mindset requires a data-driven approach and adopting the right tools to ensure these insights are brought to light and appropriately tracked and considered.
Prioritise strong supplier partnerships: With potential reduced regulation in the US, it can be more difficult to get suppliers onboard to align to your expectations. How can you mitigate this? Building trust-based partnerships must be paramount. Increase communication, prioritise potential higher risk suppliers, implement in-person or digital training to inform them on key issues and help them adapt to shifting policies. Support suppliers in understanding expectations and standards.

The path to total supply chain confidence

Responsible sourcing has always been about moving the needle, so businesses must push the boundaries and realign expectations to ensure they don’t fall behind, especially as sourcing in the US becomes more complex. By focusing on robust, multi-dimensional analysis, businesses can drive evidence-based decision-making that supports improved risk management, and ultimately, improved outcomes for workers and supply chain resilience.