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Inside Fuyao Glass, a Chinese-owned factory in Moraine, Ohio. Photo: Andrew Spear/Washington Post/Getty Images

Automation and offshoring have destroyed millions of U.S. manufacturing jobs in the last 2 decades, but another, less-discussed threat to those jobs is the U.S.-China trade war.

The big picture: Almost a fifth of all manufacturing jobs in the U.S. are created by foreign companies that put their factories in American towns to get closer to the U.S. market, according to Brookings, and around a quarter of U.S. exports come from factories owned by foreign countries, reports the Washington Post.

Why it matters: As the Trump administration ramps up its multifront trade war with China, a number of foreign companies are reconsidering their place in the U.S. While some are concerned about doing business in an "America First" environment, others appear to be delaying big-ticket projects — with scores of jobs hanging in the balance.

  • Chinese investment in the U.S. dropped almost 90% from 2016 ($46 billion) to 2018 ($5 billion), per the Rhodium Group. "Trade and other economic frictions between the two countries have substantially reduced the attractiveness of the U.S. as a destination for Chinese foreign direct investment," says Eswar Prasad, a trade policy expert at Cornell.

The backdrop: Chinese companies went from employing 500 U.S. workers in the manufacturing sector in 2007 to over 26,000 as of 2016, according to the Bureau of Economic Analysis. "It seemed like it was on this dramatic uptick," says Joe Parilla, a scholar at Brookings.

  • In some cases, Chinese companies have stepped in to bail out failing American factories. As documented in Netflix's "American Factory," China's Fuyao Glass bought a shuttered General Motors plant in Ohio in 2014 and turned it into a glass supplier for the American automaker.

"FDI [foreign direct investment], including from China, has been a significant source of manufacturing employment growth," says Brookings' Mark Muro. "But now that is ebbing."

In Arkansas, 2 factories bought by Chinese companies stand vacant as the trade fight rages on.

  • In 2017, a Chinese firm bought a factory in Forrest City, Arkansas, that had been empty for 10 years and pledged to create 800 jobs, an investment that would have made that company the biggest employer in the county, reports the American Communities Project. Two years later, the facility is still a ghost town.
  • “There are various factors that have gone into the delay, but the main factor is the tariffs,” Forrest City Mayor Cedric Williams told the American Communities Project. “We’re at a standstill until they get that resolved.”

Another Chinese company's plan to build a paper mill is on hold in Arkadelphia, Arkansas. In an interview with Christian Science Monitor, Stephen Bell, who heads the city's chamber of commerce, called the trade conflict "a dark cloud hanging over the future of the project."

What to watch: In another potential blow to Chinese-owned companies in the U.S., the Trump administration is considering restricting American firms from investing in them, reports Bloomberg.

Go deeper

More than a dozen injured in downtown Austin shooting

Police tape in Austin, Texas in 2018. Photo: y Carolyn Van Houten/The Washington Post via Getty Images

A shooting in a busy part of downtown Austin, Texas, early Saturday injured at least 13 people, including two who are in critical condition.

The state of play: Gunfire erupted around 1:30 a.m. along 6th Street, a popular area with bars and restaurants. The suspected shooter remains at large, Austin police said. "It is unknown if there is one, or multiple suspects involved," they noted, adding the shooting appears to be an isolated incident.

Biden to urge G7 to take unified approach to countering China

Photo: Hollie Adams/Bloomberg via Getty Images

President Biden on Saturday is expected to urge fellow G7 leaders to adopt a unified approach to countering China's rising global influence, AP reports.

Driving the news: The G7 leaders are set to unveil a multi-billion-dollar global infrastructure plan aimed at rivaling Beijing's efforts in the developing world.

Why America's post-vaccine summer is off to a slow start

Illustration: Sarah Grillo/Axios

Americans are itching to put pandemic life behind them, but many of the necessary ingredients for a summer of carefree fun — everything from neighborhood pools to car rentals — still aren't fully available.

The big picture: Labor shortages, scrambled supply chains and simple logistics are all making it harder for a whole range of businesses to meet post-pandemic demand, and that’s making “hot vax summer” a little harder to pull off.

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