Last week U.S. Steel announced that it would hire back 500 workers to restart operations at an Illinois blast furnace that was closed in recent years. The company says their decision was a response to Trump’s announcement of tariffs on Steel and Aluminum imports.
But economists argue that the trade maneuver will cost the thousands of jobs across the wider economy. And much of that prediction comes from analysis by the aluminum industry itself.
“The President’s strong leadership is needed to begin to level the playing field so companies like ours can compete, win and create jobs that support our employees and the communities in which we operate,” U.S. Steel said in a press release.
Blast furnaces are the part of steel mills where raw materials get combined at high temperatures to make molten steel. Century Aluminum in Kentucky also announced that the tariffs would help it hire up to 300 workers.
Trump has based his trade agenda on the promise of creating good-paying jobs. And, in several areas, he has already helped American steel. For instance, the price of US-made steel has risen 71% since Trump took office last year, according to S&P Global Platts. That is strong indication that investors feel Trump will follow through on the pledge for new tariffs.
Certainly, the announcements from U.S. Steel and Century Aluminum are great news for those 800 workers. However, economists say that job losses will be much bigger in other industries.
Mark Zandi, chief US economist at Moody’s Analytics, predicted that job losses from the tariffs could fall anywhere from 100,000 to 150,000. Other estimates are lower, with Bernard Baumohl, chief economist at the Economic Outlook Group, predicting 25,000 jobs lost in the United States.
Even aluminum experts believe that tariffs will drain more jobs than they create. Jorge Vazquez, a managing director at Harbor Aluminum, and former advisor to the US Commerce Department, predicts that aluminum tariffs will result in 90,000 lost jobs, primarily in manufacturing.
That’s because many American industries like car companies, airlines and medical equipment makers, rely on steel and aluminum to manufacture their products. Tariffs would create a cost increase, resulting in worker layoffs at those businesses to offset the costs.
The outcome already points toward job losses. The American Institute for International Steel, a pro-trade advocacy group, notes that about 142,000 Americans are employed in the steel industry. Those workers would directly to benefit from the tariffs. But a far great number of Americans — 6.5 million — are employed by steel-consuming industries. Some of those jobs would be at risk. How many, ultimately, is difficult to predict.
Scott Sloan’s company purchases aluminum for equipment it installs in car plants, storage facilities and sports stadiums. Aluminum prices were already increasing with inflation. Since the company buys foreign-made aluminum, its costs would jump even higher under the tariffs.
“We fear this is going to be a case where tariffs meant to help American manufacturing actually hurt it,” says Sloan, a spokesperson for Big Ass Solutions, a Kentucky-based firm.