Skip to comments.Shock: Wages and Jobs Soar at American Businesses ‘Hit’ by Metals Tariffs
Posted on 07/07/2018 4:24:08 AM PDT by GonzoII
When President Trump on the first day of March said that the U.S. would impose a 25 percent tariff on imported steel and a ten percent tariff on imported aluminum, many economists predicted that this spelled trouble for the industries that rely on steel and aluminum for their products. The Trump administration postponed imposing the tariffs on Canada, the European Union, and Mexico until June 1, saying it wanted more time to try to negotiate agreements that might have allowed these countries to win exemptions from the tariffs. But none of those trading partners reached a deal with the U.S. by the deadline. The tariffs were imposed when the calendar flipped to June.
Yet there are few signs that the tariffs are having a negative effect on Americas metal using industries. In fact, American businesses that make the most use of metals are adding jobs at a rate that is four times as fast as the broader economy, according to data from the Department of Labor.
The fabricated metals sectorwhere workers transform metal into intermediate or end products other than machinery, computers and electronics, and metal furnitureadded jobs in March, April, May and June. Over that period, employment in fabricated metals grew by one percent, compared with just a quarter of a percentage point growth in the broader economy. In June alone, fabricated metals added 7,000 jobs.
Machinery manufacturing added jobs in each of the four months since the announcement, including 5,000 in June. Employment in the sector grew by a whopping 1.7 percent.
Transportation manufacturing, the sector that includes automakers and aerospace, added jobs in March, April, and June. During the period it grew by 15,000 jobs, or 0.9 percent.
It is possible that the businesses hiring these workers are feeling their profits squeezed by tariffs. But the workers...
(Excerpt) Read more at breitbart.com ...
Weve been lied to for decades regarding the politicians having the American peoples best interests at the heart of all done for Americans. Now we know we were lied to ....
“What’s up with that! “
Picture an industry as a sine wave. Now picture a policy as another sine wave. For some industries the sine waves will hit peak/trough and the industry will be cancelled out. Others will hit peak/peak and the industry will soar. Now realize that for any industry there are dozens of other sine waves hitting it; the general state of the economy, other competitors, commercial demand, construction, etc. There is little 1:1 correspondence between an individual policy, say a tariff, and the corporation’s business, in a booming economy. The effect of one policy may be swamped by the other circumstances. Trying to draw a conclusion without reference to the general state of affairs is probably too simplistic. We are currently blessed with a Trump wave. I hope it lasts at least until the next elections, as these things tend to be cyclic...like sine waves.
If you buy an ax with an iron head that weighs 3 pounds that represents around $0.40 of raw iron. The hickory wood handle costs more than the iron head.
Excellent explanation! Your next assignment is to spread that far and wide among the talking heads who cannot seem to formulate any depth of thinking, preferring to keep the masses ignorant with simple-minded reporting.
I’ll point out three significant factors:
1. Using the May unemployment numbers....you have 11 states which are 3.0-percent or LESS. Alaska is the only state with a rate higher than 5.8-percent (sitting at 7.2 percent).
2. GDP predictions so far for 2018? Near 5-percent. Go back and see when that last occured.
3. Go look for any shipping company that is extremely worried over the China-trade talk. So far, no one is nervous, and they would be the first to get all fired up.
I think we were long conditioned by experts on TV to think something, and after November 2016....we’ve all come to realize the experts don’t know much about what they talk about.
America is one of two nations in the world capable of a self-contained economy. The other is France. Trade is nice (says he who shaved this morning with a German double edge razor fitted with Japanese blade), but not essential for these two countries. The jig is up and the secret is out.
While they may not have been especially good at it and were draconian being communist and all, I’d add Soviet Russia to that list because they plodded on in isolation for what, 70 years? South Africa too, they continued with massive worldwide boycotts over apartheid for how long?
Those talking heads aren't impartial pundits, or principled conservatives, but rather paid lobbyists for niche industries. As someone said above, we've been lied to about free trade for years.
I'm sure it's all good, I'm just curious. Thanks. d:^)
Charles Payne and Lou Dobbs are some of the few business people with good sense.
“If mfg’s just keep buying their product from the same sources then nothing changes but the costs of raw product and .gov collects the tarriff money. “
Different products have different types of demand. And, the places they go for their demand are dictated by market forces. Let’s take inflexible demand. You break your arm. It doesn’t matter what the emergency room charges, you will pay it. (Or, at least incur that amount of debt.) There’s flexible demand, like chocolate. If the price goes above what you’re willing to pay, you substitute your demand for something else. But let’s say you need steel girders. Normally you buy these from China as they are dumping them on the US market in order to keep employment high. (The Chinese government is terrified about social unrest. One way to keep unrest from occurring is to keep everybody employed.) Suddenly, the price of the girders has jumped to where domestic products are competitive. The sudden jump in domestic demand allows the domestic producer to ramp up production, invest in infrastructure and lower his price compared to other domestic producers. The price, over time, drops due to competition. (Some would argue as this didn’t use to happen. Protecting a domestic market enables monopolies. However, Walmart has changed the way monopolies operate, so, the price will go down. Notice that the government has not attempted to use its trust-busting laws against Walmart as Walmart’s prices are demonstrably as low as they can be in any given market. Breaking up Walmart would translate into higher prices to the poorest consumers. Walmart has the poorest consumers in per capita income compared to its rivals.)
Here is a list of five types of demand.
Let’s not forget about that Mid-Continent Steel and Wire, that nail company in Missouri that says they will soon be out of business.
The purchasing agents that buy steel can merely still issue requests for tenders to many providers not in China or Europe. One that comes to mind is vendors from India.
As the supply tightens, there might be some price increase but not near the 25% tariffed steel.
Yes, but your average milleniel or low information voter wouldn’t know what an axe is!
Did you read the reviews of the company? Leftists piling on giving one star reviews, bashing Trump and telling the employees of the company they are glad they are going out of business.
I think you are only going half way with this thought. I agree with you about the trade cutback, but we need trade not to necessarily keep ourselves in products, but to keep ourselves in control. Other countries that are not even close to being able to self-sustain themselves like we are close to, literally, need our business.
We are the demand because they only have that to supply. If we don’t buy it, they don’t eat. If they don’t eat, they have to go looking for food next door. And those people can’t spare it either. So our buying becomes a need to stop wars, not live high on the hog. And this thread is based upon what is really happening.
So the raising of products like oil, for instance, suddenly becomes a tool for control of politics and not money. Trump is teaching us that we have been lied to and positioned through the media to take the hit for being the elite country for years. So Trump’s going one way and the past liberal administrations, especially Obama, have tried not to get us there, but to bring us down to the level of others. This way the liberals can be the big fish in the little pond and not a large fish in the ocean. I kinda like the approach of us not going down to them but trying to bring them up to us. Everybody wins and only those that choose to lose will. So it stretches far beyond make America great as we can make the world better as we get great again. And it’s long overdue.
Free traitors are shocked that economics still benefit countries that manage them properly, just as they did when this country was founded.
It is just one small point but I was at the welding shop yesterday and they guys there said business was brisk. They were out of stock on several sizes of bottles and types of welding gas.
Light structural steel has gone up quite a bit since so much of it comes from mesico and that usually slows down a lot of building, or it has in the past when tariffs were added.
I also looked at a $450 welding helmet that I won’t ever own.
All good points. Add to them:
1. Can’t find enough truck drivers, goods are moving and probably more need to be moved.
2. Railroads are offering bounties for engineers and other labor, freight is moving
3. I read the other day, in support of your note on shipping, that shipping concerns are not the least bit concerned.
Trump has said he is planning to level the playing field to allow even competition by combatting punitive tariffs on our goods. A benefit of that may be that we make more things at home because it makes sense to do so. He never said he is ending trade when it makes sense. Things may cost more or some may make lower profits but choice should not be impacted by tariffs that are either protective or punitive as they are now and that includes our own.
This may take some time though. One does not become fat over night nor does one shed pounds to correct the wrong quickly. Shock therapy seldom works or has lasting impact.
The market reaction to this, in spite of the various conditions in their sine waves, as General Blather points out, concerns me though. I know the market hates uncertainty but it is over reacting to the purported trade war and under reacting to the growing economy. I am also starting to be concerned about inflation.
I still do not believe that Trump is a Smoot Hawley type disaster.
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