The US will impose tariffs on imports of steel and aluminum from the European Union, Canada, and Mexico.
They had previously been exempt from these tariffs.
The tariffs are supposed to help boost the steel and aluminum industry and protect jobs.
But according to experts and economists, they will result in a net loss of American jobs.
President Donald Trump’s trade war is supposed to help boost America’s job market, but new tariffs could actually make things ugly for US workers.
On Thursday, Trump announced that the US would impose tariffs on steel and aluminum imports from three key US allies: Canada, Mexico, and the European Union. The move follows earlier metals tariffs on countries around the world.
Peter Navarro, Trump’s protectionist-leaning trade adviser, wrote in a USA Today op-ed that the metals tariffs will be a boon for American workers.
But economists and trade experts say the ultimate result will be a net loss in US jobs — perhaps in the hundreds of thousands.
The tariffs will likely boost the price of steel and aluminum in the US, since metal imports will be subject to the additional tax. These higher prices are good news for steel and aluminum manufacturers, but they present a problem for companies that use those metals.
Increased costs for businesses that use steel and aluminum will put pressure on profits and force those companies to cut costs. Some of the necessary cost cutting is likely to come from the workforce, leading to layoffs.
Joseph Francois and Laura M. Baughman, economists at consulting group The Trade Partnership, found in a recent study that the number of jobs lost in industries that rely on steel and aluminum to produce goods would far outweigh the jobs protected in the metals industry.
“The tariffs and retaliation would increase U.S. steel employment and non-ferrous metals (primarily aluminum) employment by 26,346 jobs, but cost a net of 495,136 jobs throughout the rest of the economy, for a total net loss of nearly 470,000 jobs,” the study said.
Other economists estimated that the net loss would be somewhat smaller, but almost no major study showed that the tariffs would result in a net boost to employment.
Mary Amiti, Sebastian Heise, and Noah Kwicklis, economists at the New York Federal Reserve, could not pinpoint the exact number of jobs that could be lost from the tariffs. But they said the overall change was relatively clear.
“Although it is difficult to say …read more
Source:: Business Insider