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Trump manufacturing

For better or worse: is Trump going to boost US manufacturing?

"In November, Trump made one of his first deals as president-elect: the Carrier Deal."

In pre-election, one of the many promises Trump made was to bring back jobs to the United States. Mostly, these are jobs in the manufacturing industry. In addition, he stated to impose new taxes on many imports into the country to make it less attractive to import, and thus more attractive to buy products made in America. What are the implications of Trumps promises for US manufacturing?

It makes the number of manufacturing jobs grow

Of course, one of the implications of Trumps promise to bring back manufacturing jobs, is that there will be more employment. But is it that simple? Not really. Economists state for example that suddenly changing trade politics and tariffs could actually lead to job losses, instead of growth.

It costs time

Bringing back jobs is a noble promise, but what is stated nowhere is how this is going to be realized. It is complex, and reshoring is not something to do in a couple of days. Harry Moser, president of the Reshoring Initiative, states: “You can’t do it in a day, you can’t do it in a year. I’d be delighted if we can do it in a decade or two.”

Relationships with other countries can be put under pressure

Trump not only wants to increase import taxes, he is also planning to renegotiate or even withdraw from the North American Free Trade Agreement (NAFTA) and Trans-Pacific Partnership (TPP). However, since these are balanced agreements, it will be hard to negotiate them. Taking these steps can put the ratios under pressure, which could in the end lead to a decrease of jobs instead of an increase.

Recommended: Five factors for bringing back manufacturing jobs to the US

Example: the Carrier Deal

In November, Trump made one of his first deals as president-elect: he kept Carrier from moving 1000 jobs from Indiana to Mexico. For the people who work at Carrier, this deal is great news. But is it also that great for America? Terms of the deal are still unknown and there is no guarantee for the future. Still, the Carrier Deal is a victory for Trump and gives hope for the future.

US manufacturing world’s no. 1?

Whether Trump will keep his promises is still to be seen. About the TPP trade deal, he claimed that he will pull out in his first day in office. Later, he will negotiate ‘fair’ bilateral trade deals. So far he has not mentioned the NAFTA. Whether this will be a priority in his term, remains to be seen.

Earlier this year, the Global Manufacturing Competitiveness Index report predicted that by 2020, the United States would be the most competitive country in the world. Technological advance is key in this case. Is this still going to happen? The future will tell.

Sources:
Washington Post
Politifact
BBC
Wired

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