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article imageAs Trump promotes his tariffs, companies are laying off workers

By Karen Graham     Aug 9, 2018 in Business
The ongoing trade war President Donald Trump has waged against world powers, including some of our closest allies, doesn't show signs of slowing down, forcing many U.S. companies to make some hard decisions about where to cut costs.
Trump attended a rally in Ohio this past weekend and ended up talking about himself ahead of the last special election for Congress before November. Ignoring the candidate he was supposed to be backing, he chose to build himself up instead.
After denigrating the "fake news" media, and reminding his followers of the "seriously low IQ" of Rep. Maxine Watters and renewing his attack on the Mueller investigation, he remembered where he was and switched over to bragging about how well he had done fixing the economy.
And when Trump returned to Washington, he renewed his claims on how well the economy was doing under his guidance:
Untitled
Donald J. Trump
Tariffs, trade and the economy
We won't get into the unemployment numbers that are calculated using the same method used by the Obama administration that erases those unemployed from the records so they are not included. Nor will we mention that hourly wages have barely kept up with inflation, only rising 2.7 percent compared to 5.0 percent in the 1990s. But Trump says this is all good.
One thing he has not bragged about lately is the U.S. trade deficit - and probably with good reason. Actually, the U.S. trade deficit expanded in June, at its fastest rate since November 2016. Also, $291 billion was added to that gap in the first six months of 2018, compared with $272 billion in the first half of 2017.
Another thing the Trump administration isn't talking about is what has been transpiring since he added all those tariffs, to begin with. Billions of dollars in tariffs were imposed on imports to the U.S. as a way to help American companies, right? But those imports grew slightly while exports from the U.S. are going down.
Tempers are red hot over Washington's decision to slap tariffs on imports of steel and aluminiu...
Tempers are red hot over Washington's decision to slap tariffs on imports of steel and aluminium
Patrik STOLLARZ, AFP/File
American businesses are feeling the pinch
With the latest tariffs on an additional $18 billion worth of Chinese goods set to go into effect later this month, Trump still believes our trading partners will back down, lowering their tariffs on American goods, improving the market for the U.S. But this is not happening, yet.
American businesses, jobs, and consumers are now feeling some unwanted and unwarranted effects of the growing trade war instigated by the White House. There is a growing list of companies either planning to close plants, lay off employees, tossing out plans for new jobs or raising prices.
Many large companies have already opted to pass along the higher cost for materials and parts along to the consumer or absorb the losses into their profit margins, points out Business Insider. However, small businesses are forced to make much tougher decisions.
Several nails
Several nails
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Smaller businesses are being forced to cut labor costs in an attempt to offset the higher cost of materials. And this is now happening from Michigan to South Carolina and beyond. Here are just a few examples of what is going on today:
In Michigan, Mid-Continental Nail, the largest US nail producer, laid off 130 workers after steel prices jumped. One of its plant managers said the entire business could shut down over the next few months.
SEMO Box, a packaging company in Cape Girardeau, Michigan is also feeling the impact of Mid-Atlantic's layoffs. They have had to let go a number of employees.
In South Carolina, Element Electronics, a TV manufacturer, plans to lay off 127 workers as "a result of the new tariffs that were recently and unexpectedly imposed on many goods imported from China."
Brinly-Hardy, an Indiana-based maker of lawn-care equipment, laid off 75 workers. "We are collateral damage in this effort," Jane Hardy, the company's CEO, told The Washington Post.
US President Donald Trump recently threatened to slap punitive tariffs on all Chinese imports  which...
US President Donald Trump recently threatened to slap punitive tariffs on all Chinese imports, which accounted for more than $500 billion last year
SAUL LOEB, AFP
Even the Tampa Bays Times has been hit by the tariffs. The company laid off 50 employees in April because of the newsprint tariffs imposed on Canada. Newspapers in other small communities, like House Speaker Paul Ryan's hometown paper in Janesville, Wisconsin, have also been forced to lay off staff.
In Washington state, REC Silicon, which supplies silicon materials for solar panels, had to lay off 100 employees in the company's Moses Lake plant. The company also cut production back by 25 percent, according to Reuters.
There are many more small companies dealing with the same problems, and it may get even worse. “This is hurting the economy but so far it’s manageable,” says Mark Zandi, chief economist of Moody’s Analytics. “If the war continues to escalate, it will do more damage and at some point it will undercut the good economy” and trigger significant job losses and likely a recession.
More about Tariffs, Trade war, US companies, Trump, Economy