The U.S. manufacturing boom kicked off by President Trump’s big tax cuts has turned into a bust.
Why? Trump’s tariffs — especially the trade war with China.
Earlier growth in U.S. manufacturing jobs turned negative in 2019.
“Reviving American manufacturing was a central tenet of Trump’s 2016 campaign, and the industry’s retrenchment shows how another Trump constituency is being punished as a result of his trade war,” reports Axios, noting that farmers, too, are suffering.
But the president’s campaign promise, which flowered in his first 30 months in office, has fizzled. In the last six months alone, the manufacturing industry has lost 23,000 jobs — and the average hours worked by those still on the job has fallen to the lowest level in eight years.
In October, Axios says, U.S. manufacturers “cut jobs in the sector by the highest number in a decade” — a figure “blamed largely on striking auto workers,” yet following “a clear trend in the industry.”
Axios quotes one Ohio CEO as saying his company “will try to hold on until the end of the year without raising prices.”
But, he said, “If the tariffs remain, I’m going to have to start making moves. Meaning: the consumer will pay, and I’ll pay, and then employees will pay, if we don’t grow according to plan.”
The Federal Reserve confirms the manufacturing downturn in its latest report on American business, with the Dallas Fed saying that: “Uncertainty generally remained elevated, driven by trade tensions, the political climate, and weaker global growth.”
Joe Brusuelas, chief economist at tax and consulting firm RSM, told Axios that “to bolster the economy [the administration] will need to roll back those tariffs, and that’s a difficult pill to swallow for Mr. Trump and his followers.”