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Middle-market U.S. firms sent 20% less money to Chinese suppliers than they did in October 2024, according to a JPMorganChase Institute analysis reported by Fortune. Supply chain surveys have been reporting an intent to leave China since the first tariff rounds. Payments data records what companies actually did.
These are firms with revenue between $10 million and $1 billion and fewer than 500 employees. They collectively employ about 48 million people. They are small enough to change sourcing quickly and too small to absorb tariff costs the way a multinational can.
The money left, and where it went is unresolved.
The Institute cannot yet say whether production moved or simply rerouted
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The Institute's business research director pointed to indications that these firms may be shifting toward other regions in Asia. The analysis stops short of confirming it, and states plainly that it is unclear whether China is routing goods through other countries or whether supply chains have relocated.
That distinction carries more weight than the headline number. A container leaving a Vietnamese port after a final assembly step and a factory that actually moved produce identical payments data. Only one of them changes where anything gets made.
The Institute's authors said companies are still adjusting and that they plan to keep studying the question.
More than 4 in 10 small firms report tariff costs hitting operations
The pressure behind the shift is documented. The Federal Reserve's Small Business Credit Survey found rising costs to be the most frequently cited financial challenge among small firms, with more than 4 in 10 reporting that tariff-related price increases are affecting operations. Those firms are either absorbing the costs or passing them to customers.
Center for American Progress analysis of Treasury data estimates that the average small-business importer paid roughly $306,000 more in tariffs from March 2025 through February 2026 than in the prior 12 months.
244,000 reshoring jobs announced in 2024, with U.S. costs 10% to 50% higher
Bringing production home gets the most attention and the least follow-through. The Reshoring Initiative counted 244,000 U.S. manufacturing jobs announced in 2024 through reshoring and foreign direct investment, with more than 2 million announced since 2010.
The same report projects 2025 announcements dropping to roughly 174,000, and identifies the constraint holding the number down. Without broader reform, U.S. manufacturing costs remain 10% to 50% higher than offshore competitors, which continues to drive most import decisions. Low-tech and mass-market consumer goods remain the least reshored categories.
Reshoring is real and selective, but it is not accounting for the 20%.
Four suppliers for one component means four lead times to reconcile
That leaves diversification: keeping some China volume while adding suppliers elsewhere. It works cleanly on a whiteboard and generates work everywhere else.
One supplier means one price list and one part numbering convention. Four suppliers for the same component means four of each, and none of them agree. Reorder points calculated against a 45-day lead time break when a second vendor runs 70. Landed cost stops being a number and becomes a calculation that changes per shipment.
Vendor management across cost, lead time, and part numbers exists as a software category because the multi-supplier model creates reconciliation work that single-sourcing never generated.
Customs data from receiving countries will settle the rerouting question
Globalization debates have run on forecasts and position papers for a decade. Payments data records what companies did rather than what executives told a surveyor they were considering.
The record now shows measurable movement and an unconfirmed destination. The test is whether import volumes reported by the countries picking up that business eventually match what left China. A gap between the two would mean goods are moving through new ports rather than being made in new places, and it will take another year of payments data before that shows up.
