The first layoffs from Trump’s tariffs are here

[Steeleballz 7,550]

 

  

The first casualties of President Trump’s trade war are 60 workers at Mid-Continent Nail, America’s largest nail manufacturer. They lost their jobs on June 15 at a factory in a part of Missouri that voted overwhelmingly for Trump. The whole company could be out of business by Labor Day.

This is a potential game changer in Trump’s trade strategy, especially if it marks the start of more companies announcing layoffs. On Monday, Harley-Davidson said it will be moving some “production” offshore because of the trade war (Europe hit Harley with a 31 percent tariff in response to Trump’s steel tariffs on Europe). Harley won’t confirm whether jobs are leaving the United States, but the union representing many Harley workers, the International Association of Machinists and Aerospace Workers, is worried.

 

 

  https://www.washingtonpost.com/news/wonk/wp/2018/06/25/the-first-layoffs-from-trumps-tariffs-are-here/?noredirect=on&utm_term=.4d42514c0bb7

[jg121783 3,908]

Interesting. The company I work for makes parts for Harley and we have seen our orders from them increase over the last couple months. Good thing we have tariffs on some foreign auto manufacturers so they will be opening plants here which should offset any jobs we lose.

Edited June 30, 2018 by jg121783

[Steeleballz 7,550]

6 hours ago, jg121783 said:

Interesting. The company I work for makes parts for Harley and we have seen our orders from them increase over the last couple months. Good thing we have tariffs on some foreign auto manufacturers so they will be opening plants here which should offset any jobs we lose.

 

   The article outlines one of the issues that was not difficult to foresee. There is a tariff on Chinese steel. There is no tariff on Chinese nails. Now, a US manufacturer has to pay more for steel to produce nails and can't compete with the Chinese product. This won't be an isolated event, and I'm not sure how meaningful a theoretical manufacturing plant in the future is to people losing jobs right now.

 

   Incidentally, Harley already has plans to move production overseas. They are getting hit with increased production costs here due to US tariffs and absorbing higher prices to sell overseas due to retaliatory tariffs in European markets. GM has discussed this as well. GM has also warned of US job losses. We can hope for an offset in jobs if US production increases, but it's by no means a given. The reality is a net loss of jobs and increased consumer costs are also a strong possibility. 

[jg121783 3,908]

31 minutes ago, Steeleballz said:

The article outlines one of the issues that was not difficult to foresee. There is a tariff on Chinese steel. There is no tariff on Chinese nails. Now, a US manufacturer has to pay more for steel to produce nails and can't compete with the Chinese product. This won't be an isolated event, and I'm not sure how meaningful a theoretical manufacturing plant in the future is to people losing jobs right now.

The tariff on Chinese steel is creating jobs for US steel producers. It is also providing higher quality steel for manufacturers (which I can say from personal experience is a big deal) and consumers. At the end of the day we are making a big deal about 60 jobs lost when millions have been gained. It sucks for the people who lost their jobs but it is insignifigant when looking at the big picture. You say you are not sure how significant theoretical jobs in the future are and I say I am not sure how significant theoretical job loses are in the future.

 

37 minutes ago, Steeleballz said:

Incidentally, Harley already has plans to move production overseas. They are getting hit with increased production costs here due to US tariffs and absorbing higher prices to sell overseas due to retaliatory tariffs in European markets. GM has discussed this as well. GM has also warned of US job losses. We can hope for an offset in jobs if US production increases, but it's by no means a given. The reality is a net loss of jobs and increased consumer costs are also a strong possibility. 

Harley is doing some production overseas for overseas markets. Most of this is lower paying assembly jobs and not fabrication which are the more skilled higher paying jobs that are staying right here. Looks to me like a left leaning union trying to fear monger. As I said I work for a company that fabricates parts for Harley and over the last few months orders have increased so much some jobs are being sub contracted out while the company scrambles to hire more people and purchase new machinery. The article you linked to talks a lot about theoretical scenarios but what is currently happening in the real world is a little different.

[The Nature Boy 7,659]

31 minutes ago, jg121783 said:

The tariff on Chinese steel is creating jobs for US steel producers. It is also providing higher quality steel for manufacturers (which I can say from personal experience is a big deal) and consumers. At the end of the day we are making a big deal about 60 jobs lost when millions have been gained. It sucks for the people who lost their jobs but it is insignifigant when looking at the big picture. You say you are not sure how significant theoretical jobs in the future are and I say I am not sure how significant theoretical job loses are in the future.

 

Harley is doing some production overseas for overseas markets. Most of this is lower paying assembly jobs and not fabrication which are the more skilled higher paying jobs that are staying right here. Looks to me like a left leaning union trying to fear monger. As I said I work for a company that fabricates parts for Harley and over the last few months orders have increased so much some jobs are being sub contracted out while the company scrambles to hire more people and purchase new machinery. The article you linked to talks a lot about theoretical scenarios but what is currently happening in the real world is a little different.

Best unemployment in decades. One factory shuts down losing 60 jobs. OMG Trump. Is comical actually. 

 

You mean this company went out of business because of Trumps tariff in less than 3 weeks. Amazing. 

[Steeleballz 7,550]

6 minutes ago, jg121783 said:

The tariff on Chinese steel is creating jobs for US steel producers. It is also providing higher quality steel for manufacturers (which I can say from personal experience is a big deal) and consumers. At the end of the day we are making a big deal about 60 jobs lost when millions have been gained. It sucks for the people who lost their jobs but it is insignifigant when looking at the big picture. You say you are not sure how significant theoretical jobs in the future are and I say I am not sure how significant theoretical job loses are in the future.

 

Harley is doing some production overseas for overseas markets. Most of this is lower paying assembly jobs and not fabrication which are the more skilled higher paying jobs that are staying right here. Looks to me like a left leaning union trying to fear monger. As I said I work for a company that fabricates parts for Harley and over the last few months orders have increased so much some jobs are being sub contracted out while the company scrambles to hire more people and purchase new machinery. The article you linked to talks a lot about theoretical scenarios but what is currently happening in the real world is a little different.

 

    You are ignoring the premise of the article. Consumers, given a choice can still buy finished products from China. It doesn't matter if the US company chooses to use Chinese steel or American steel. The cost increases either way, and the consumer , given the choice, still buys cheaper nails from China.  If the goal is to make American manufacturing stronger, that can be done, but the cost will either be jobs lost or higher consumer prices. You can not change just one of those factors. If you still have cheap products coming into the US, you will lose jobs. As I said before, the mistake here was diverting the fight to the G7 in the first place and not going all in with China. The G7 should have tackled China as a group and then worked out their differences later.  

 

   As far as Harley only making parts overseas, it makes no sense for Harley to pay the higher cost for materials to build in the USA and then pay the export tax to sell those same bikes in Europe. It is foolish to think they wont eventually manufacture the bikes at a plant in Europe if the tariffs continue. 

[spookyturtle 9,465]

Funny when Trump saved a few jobs it was a big deal to a few here. 

[Steeleballz 7,550]

1 minute ago, Nature Boy Flair said:

Best unemployment in decades. One factory shuts down losing 60 jobs. OMG Trump. Is comical actually. 

 

You mean this company went out of business because of Trumps tariff in less than 3 weeks. Amazing. 

 

  No, the company projects to go out of business by labor day. That's what happens when you can't sell your product. 

[The Nature Boy 7,659]

1 minute ago, Steeleballz said:

 

  No, the company projects to go out of business by labor day. That's what happens when you can't sell your product. 

the tariffs happened end of may. June 15 they announced layoffs ( you are correct not out of business). The truth will come out. I spent to long in business to belive they were not already in serious trouble.

[Steeleballz 7,550]

Just now, Nature Boy Flair said:

the tariffs happened end of may. June 15 they announced layoffs ( you are correct not out of business). The truth will come out. I spent to long in business to belive they were not already in serious trouble.

 

   Common sense would say yes, the closer you are to the edge, the faster you will go off the cliff. Unfortunately, there are lot of US companies that are close to the margin. I wouldn't want to see them all go over. The intent was to make them stronger, not bury them.

[The Nature Boy 7,659]

A little more insight 

 

Poplar Bluff nail manufacturer gets hammered by new tariffs on steel

https://www.semissourian.com/story/2532801.html

 

snip

News of Mid Continent's layoffs was announced by Sen. Claire McCaskill,

 

"The trouble for the company started at the end of May when Trump put a hefty 25 percent tariff on steel imports from Mexico and Canada. Mid-Continent had been importing steel from Mexico that American workers would then turn into nails."

[Steeleballz 7,550]

1 hour ago, Nature Boy Flair said:

A little more insight 

 

Poplar Bluff nail manufacturer gets hammered by new tariffs on steel

https://www.semissourian.com/story/2532801.html

 

snip

News of Mid Continent's layoffs was announced by Sen. Claire McCaskill,

 

"The trouble for the company started at the end of May when Trump put a hefty 25 percent tariff on steel imports from Mexico and Canada. Mid-Continent had been importing steel from Mexico that American workers would then turn into nails."

 

  As I said, doesn't matter where the steel comes from, if finished steel products are cheaper and not taxed accordingly, American companies will be at a disadvantage. The bottom line is the same; this company can no longer manufacture nails and be competitive with the same product produced in China. 

 

  Again, if our major trade issue was with China's unfair trade practices (which it should have been), it would have made more sense to tackle that issue head on and fully. China is in a relatively stronger position now than if we had exerted united pressure with the G7 members. No matter how it ends, it would have been smarter to take on China as a group and work out our issues with the G7 later. I think that was the intent, but unfortunately Trudeau didn't stroke Trump's ego the right way and we are where we are. As I have said before, the US may well come out on top of all this, but we are definitely taking a harder route now than we could have, and people are going to feel that.

[Voice of Reason 10,298]

1 hour ago, Steeleballz said:

 

  No, the company projects to go out of business by labor day. That's what happens when you can't sell your product. 

If your company is going out of business a couple of months after an economic change, then your company was going out of business for a long time, but you just never publicized that fact.  Your business had MUCH larger issues prior to the tariff changes.

[jg121783 3,908]

 

2 hours ago, Steeleballz said:

As far as Harley only making parts overseas, it makes no sense for Harley to pay the higher cost for materials to build in the USA and then pay the export tax to sell those same bikes in Europe. It is foolish to think they wont eventually manufacture the bikes at a plant in Europe if the tariffs continue. 

You are missing a few things here. First of all they aren't making the parts overseas but rather making the parts here and assembling the finished product overseas (if they are even doing that overseas). Usually export taxes only apply to the finished product so that is a moot point. They could potentially assemble the finished product overseas but fabricating the parts overseas would be cost prohibitive considering a number of factors such as the cost of the machinery (one CNC machining center for example can cost as much as $1 million or more). Another factor is that Harley has a large share of their parts fabricated by outside companies such as the one I work for. For those and other reasons it may or may not be viable to assemble their products overseas but they certainly aren't going to fabricate their parts overseas to save a couple thousand dollars export tax per bike.

 

[Steeleballz 7,550]

22 minutes ago, Satisfied said:

If your company is going out of business a couple of months after an economic change, then your company was going out of business for a long time, but you just never publicized that fact.  Your business had MUCH larger issues prior to the tariff changes.

 

   May be true, but I imagine there are many companies in the USA that could not easily absorb a 25% increase in production costs and not be able to pass any of that on to consumers. I think we all realize that Trump is trying to revive US manufacturing, but we also have to realize that will come at a cost. I would have preferred an approach that isolated China first, and then worked out trade issues with our allies second.