The US construction industry may lose more than 28,000 jobs if Donald Trump’s plan to raise tariffs on imported steel and aluminium goes ahead, a pro-free trade think tank has warned.
And construction of an Electrolux factory in Tennessee has been put on hold after the US president’s controversial announcement last week that he would slap a 25% increase on imported steel and 10% on aluminium to protect American jobs.
The fallout from the surprise announcement continues, with Trump’s own Republican party expressing "extreme worry" at the prospect of a trade war. And last night Trump’s top economic advisor, Gary Cohn, resigned, with Bloomberg reporting that Cohn’s resignation came after he refused to support the tariffs in a meeting with Trump earlier in the day.
While Trump claims tariffs would create jobs in America’s steel and aluminium sectors, a Washington, DC, thinktank, Trade Partnership, warned that such a policy would "reverberate throughout" the economy, costing more jobs than it would gain as it pushed up the cost of the metals.
Its report this week said around 33,400 jobs would be created in the iron and steel sectors, but that 179,000 jobs would be lost in other sectors – including 28,000 in construction – leading to a net job loss of 146,000. It said five jobs in manufacturing and construction would be lost for every one gained in the iron and steel sector.
Springfield, Tennessee, where Electrolux was planning to build its factory (YouTube)
As well as making buildings more expensive, the move may act as a disincentive to invest in the US for those companies that make things with US steel and aluminium.
One of the first reactions from companies was made by Swedish white goods maker Electrolux, which called a time out to plans to build a $250m factory in Springfield, Tennessee while it evaluates the impact of Donald Trump’s decision, which would increase its production costs.
A spokesperson for the company, the largest white goods maker in Europe, told the Reuters news agency: "We are putting it on hold. We believe that tariffs could cause a pretty significant increase in the price of steel on the US market … and damage the overall competitiveness of our operations in the US."
As well as possibly losing long-term manufacturing jobs, Tennessee could be also be hit by retaliatory tariffs on bourbon brands such as Jack Daniels.
Top image: Steel stacks lit at night at the defunct Bethlehem Steel Plant in Pennsylvania, which is now a park and entertainment centre (Carol Bell/Dreamstime)