Did Trump’s Tariffs Actually Create American Jobs? A Closer Look at the Job Market During the Trade War
Written by
T. Woods
Edited by
Amber Barkley
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The American job report for the month of April surpassed all expectations by indicating approximately 177,000 new jobs in the country — that’s 44,000 (33%) more positions than were initially forecast for April. Per Forbes, expectations among Dow Jones economists and experts were far closer to approximately 133,000 new jobs at best.
While federal government employment dipped — unsurprising, given the Department of Government Efficiency’s job-cutting efforts — Forbes noted that such industries as finance, healthcare, social support, transportation and warehousing all leapt forward.
These gains, along with a growing labor force of 171,109,000 people — up 518,000 employees from March — not only exceeded expectations, they also came at a time of deep economic uncertainty due to President Donald Trump’s controversial tariff policies.
The Current Job Market Doesn’t Necessarily Reflect Tariffs
That said, many of the most disruptive tariff announcements — a baseline 10% tax on imports from all countries, continual escalations of tariffs on imports from China and China’s retaliatory tariff war on the U.S. — didn’t occur until April had begun, meaning the extreme impact of Trump’s trade war likely cannot be assessed by these numbers.
However, it is unlikely that the trade war will actually increase jobs; in fact, the opposite is more likely.
Predictions for the Future
As Barron’s reported, the progress charted by the April jobs report could be slowed, or even reversed, by the tariff policies.
Barron’s projected that Trump’s tariffs will increase inflation — and thus the overall cost of living in America. As cost of living increases for employees, their employers will have to pay more for labor; further, employers might be forced to contend with difficulties borrowing money to help pay for raises if the Federal Reserve hikes interest rates to combat that tariff-driven inflation.
As a result, many industries would then have to operate at much higher costs, at reduced profits, which would prevent employers from hiring more workers. Layoffs and terminations could ensue, and the strides in labor and the economy could come to a halt.
While it’s highly unlikely that Trump’s tariff war created American jobs — given that their impact could not be fully measured in April for the most recent jobs report — it seems more likely that they will, at least in the short term, risk slowing job growth rather than spurring it.
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Sources
- Forbes, “Jobs Report Beats Expectations At 177,000 Even With Tariff Uncertainty.”
- Barron’s, “Inflation Is Creeping Into the Labor Market. Tariffs Are a Worry.”
