Phoenix has emerged as the epicenter of America’s manufacturing resurgence, attracting $114 billion in manufacturing investment between 2021 and 2024—more than any other U.S. metro area. The influx positions the nation’s third-largest housing market for sustained construction activity, but also introduces new economic dependencies that could reshape demand patterns.
According to Zonda Economics’ latest State of the Market analysis, semiconductor and electronics manufacturing accounted for nearly three-quarters of Phoenix’s industrial investment. Taiwan Semiconductor Manufacturing Company’s $150 billion expansion alone is expected to generate 6,000 permanent jobs and support 40,000 construction jobs over the next four years.
“A nationwide push to reshore and rebuild American manufacturing capacity has placed Phoenix at the center of a modern industrial resurgence,” says Ali Wolf, Zonda’s chief economist. “The Trump administration’s renewed focus on domestic production positions Arizona’s manufacturing corridor to capture an even larger share of national capital spending.”
Strong Economic Foundation
The manufacturing boom builds on Phoenix’s robust employment base. Despite slowing job growth, total employment is up 28% from 2019, with a 20% rise in high-income employment. The market added 37,800 jobs over the past year.
Health care has become a key economic anchor, accounting for 15% of total employment and adding 20,400 jobs over the past year—5.9% year-over-year growth. High-income employment rose 0.9%, with financial activities up 1.9% and now representing 8.6% of local jobs, well above the national average of 5.9%. Phoenix’s median household income rose to $87,785 in 2024, up 2.4% year-over-year.
International Talent Dependency
Phoenix’s manufacturing expansion introduces new risks tied to immigration policy and global supply chains. TSMC’s success hinges on access to highly specialized international talent through H-1B visas to fill complex engineering roles in short supply domestically.
“Any disruptions in visa availability, trade policy, or semiconductor supply chains could slow construction, delay hiring, or limit production,” Wolf warns. “With thousands of workers tied to TSMC’s expansion, even short-term uncertainty could weigh on housing demand.”
International migration to Phoenix grew 22.2% year-over-year and now outpaces domestic inflows—a reversal of the market’s long-term trend. Phoenix ranked 14th among markets with the most international migration in 2024.
“This growing reliance on international newcomers introduces new vulnerabilities,” Wolf notes. “Federal immigration policy, visa availability, and border enforcement all have the potential to directly impact Phoenix’s population and labor market dynamics.”
Builder Response
Phoenix ranks third nationally for master planned community activity, with projects within MPCs selling at paces 11% faster than standalone communities. Master plan sales account for nearly 50% of all new homes sold in Phoenix, with over 70 actively selling MPCs providing continued runway.
The growing share of Baby Boomers, up 10.8% from 2020 to 2024, is driving demand for single-level floorplans, while Millennials, up 8.9%, are seeking attainable smaller-lot detached homes and townhomes.
For builders, the manufacturing boom represents significant opportunity, but one requiring careful attention to policy shifts that could impact housing demand timing around major employment hubs.
The insights in this article were taken from more in-depth research reports published in Zonda’s National Outlook subscription.
