Donald Trump said his tariffs on Chinese imports would bring factory jobs back to the US, but that’s not happening
- American companies are pulling out of Chinese plants, but they’re not returning the work to the US
- An index tracking the level of manufacturing jobs brought back to the US decreased for the third year in a row in 2018 despite Trump’s trade measures
When US President Donald Trump’s administration imposed tariffs on US$250 billion of Chinese goods last year, the move was sold to the American public as a magic bullet that would bring jobs back to the US. It misfired.
Under mounting pressure as tariffs threaten to drive up costs, US manufacturers in China are indeed packing up and heading elsewhere. Companies including Nike, Crocs, Roomba and GoPro are now producing most of their goods outside the country, having set up operations in Vietnam, India, Bangladesh and Mexico. Dell, Sony, Nintendo and HP are reportedly considering such moves.
But very few are moving back to the US.
“Trump’s tariffs may have sent the message to ask US companies to consider reshoring, [but] very few will actually follow through,” said Daniel Ikenson, director of the Centre for Trade Policy Studies at the Cato Institute, a non-partisan think tank. “Making products in America has become too expensive.”
Trump said the US was “winning” the trade war after a temporary truce was struck in late June with his Chinese counterpart, Xi Jinping.
But as the US and China engaged in a fresh round of talks this week in Shanghai after a long stalemate, there were few signs of an American manufacturing renaissance.