I was in Washington this week and had a chance to read a bunch of material regarding the tariff plan. The notion of expanding employment in the U.S. with these tariffs is really silly. It is clearly the case the primary metal production employment has been on the decline as seen here.
Metal production employment currently sits at little more than half the level it was in 1990, and the decline was certainly steep. Interestingly the pattern of employment movement closely resembles that found in manufacturing employment.
This might make it tempting to say that these are equally important but they are not. When you look at the scale on the y-axes you see that manufacturing employment is much higher throughout than metal production. You can really see this when you look at the two together.
Manufacturing employment is much higher than metal production. This is where the suggestion of tariffs increasing U.S. employment starts to break down for me. You potentially jeopardize the manufacturing sector with a trade way, which has much higher employment levels than the primary metals, which may not make a recovery at all, let alone enough to offset what manufacturing may lose.
This seems to be yet another in a line of policies made as if the effects were independent of all other actions and economic activities. It is disappointing, and at some level dangerous, and may actually undo some of the early benefits of the tax cuts.
