Preparing for multiple possible futures has become a core part of economic development strategy. The Guild’s certified site selection consultants examine the opportunities and risks most likely to shape location decisions in the year ahead.
Guild Members Seth Martindale, Jason Hickey, Courtney Dunbar, Chris Lloyd, and Phil Schneider unpack the boldest “blue sky” opportunities and most consequential “black swan” risks. The “blue sky” event creates sustained, stable and highly positive economic performance with minimal risk, while the “black swan” event signals a high-impact disruption capable of triggering widespread economic challenges.
Trade, Supply Chains and the Future of Manufacturing
Global trade is a consequential force in both manufacturing investment and site selection. In a best-case scenario, stabilized trade relationships could potentially unleash a new wave of manufacturing investment across North America.
If trade tensions ease and frameworks like USMCA remain intact, the result could be significant foreign direct investment, projecting more than $125 billion in new manufacturing deals. Schneider states that this shift toward Americas-centric manufacturing, combined with infrastructure upgrades and workforce development, could create an estimated 300,000 new manufacturing jobs and transform communities.
The downside scenario? A breakdown in trade agreements or escalation into a broader global trade conflict could fracture supply chains, increase costs and freeze investment decisions. Guild Members emphasize that in such a scenario, retaliatory tariffs, decoupling of major economies and geopolitical tensions could trigger recessionary conditions, including scenarios where U.S. GDP contracts by 3%, manufacturing job losses exceed 500,000 and capital investment freezes amid trade uncertainty.
AI, Automation and the Workforce Paradox
Artificial intelligence and automation have the potential to fundamentally reshape workforce dynamics, productivity and site selection decisions.
Dunbar points to the potential for AI and automation to increase industrial output by as much as 50%, while helping alleviate workforce shortages through productivity gains and workforce upskilling. In this “blue sky” scenario, AI does not become a job eliminator, but a multiplier that frees up time, enhances outcomes and enables workers to move into higher-value roles.
On the downside, AI’s rapid pace of adoption could disrupt both blue- and white-collar employment, particularly at the entry level. As automation scales and technologies like quantum computing advance, entire sectors could face displacement, with ripple effects across real estate, infrastructure and labor markets.
“The question is not whether disruption will occur, but how quickly and how evenly economies will adapt,” Lloyd, of McGuireWoods Consulting, said.
Energy as Both a Constraint and Catalyst
Access to reliable, scalable power is quickly becoming one of the most critical and uncertain factors in economic development.
On the opportunity side, Guild Members highlight a future where investments in generation, transmission and regulatory reform unlock new development potential particularly for data centers, advanced manufacturing and large-scale industrial projects.
Electricity demand is rising sharply, driven in part by data centers which alone may consume 8% to 12% of total U.S. electricity by 2030. This could drive significant investment in grid modernization, interconnection reform and generation capacity.
Dunbar explains that public and private investment is accelerating grid modernization, with an estimated $1.5 trillion to $2 trillion in grid investments anticipated by 2035 and more than 2,000 GW of generation projects currently in U.S. interconnection queues. In parallel, companies are increasingly turning to on-site generation and “power-ready” sites as a competitive advantage in site selection.
The risks are equally significant. Extreme weather events, grid constraints and aging infrastructure could lead to widespread outages and supply disruptions. In a worst-case scenario, simultaneous climate or infrastructure shocks could interrupt power generation and transmission, resulting in production losses and supply chain breakdowns.
Capital Markets and the Cost of Growth
The availability and cost of capital are increasingly shaping which development projects move forward and which do not. Lloyd said that after more than a decade of historically low interest rates, the cost of capital has risen sharply, with corporate borrowing costs in some cases doubling or tripling since 2021 and construction financing frequently exceeding 8% to 10%.
In a negative scenario, tightening credit conditions, high construction costs and a wave of maturing debt could create a “double shock” for projects, making financing difficult and delaying or canceling development plans. Dunbar points to the more than $2 trillion in U.S. commercial real estate debt set to mature by 2027 as a potential stress point for the market.
Conversely, a policy-driven resurgence through renewed federal funding, incentives or industrial programs and interest rate reductions could revive stalled projects and spur new waves of investment. This tension underscores a broader reality: economic development in 2026 will hinge not only on demand, but on the availability and affordability of capital to meet it.
Preparing for Volatility
Uncertainty is part of the job. Scenario planning and preparedness are essential as companies make location decisions amid geopolitical risk, infrastructure constraints and workforce challenges.
For economic developers, this shift demands a proactive and resilient approach, including:
- Building flexibility into site readiness and infrastructure planning
- Strengthening workforce pipelines that can evolve with technology
- Engaging stakeholders early to mitigate risk and build community support
- Diversifying economic strategies to withstand external variables
- Asking site selectors how companies are scenario planning, then aligning community messaging accordingly
We can no longer simply react to disruption.
“Actively anticipating disruption is part of what location strategy is all about now,” Hickey, of Hickey & Associates, said.
Success will belong to those who can navigate both the optimism of blue skies and the uncertainty of black swan events, turning foresight into strategy and disruption into opportunity.
Want more site selection insights? Explore the Guild’s latest thought leadership for expert perspectives from certified site selection consultants.