Expand chart
Data: Bureau of Labor Statistics; Chart: Axios Visuals

American manufacturers rode a wave of optimism after President Trump took office, clinging to his promises to revive the industry and bring back jobs.

Yes, but: The politically important sector is being choked by his trade war with China, and business leaders tell Axios that the tariffs threaten to upend the economy if not addressed soon.

Driving the news: The manufacturing sector added 18,000 jobs in September of last year, following a steady rise in employment.

  • But just one year later, the pace of gains has slowed: Last month, the sector cut thousands of jobs for the 2nd time this year.
  • A closely watched index that tracks the health of the industry also showed that manufacturing is in the worst shape since before President Trump took office — contracting for 2 straight months. The last time the sector contracted was in 2016.

And while President Trump has blamed the Federal Reserve for the slump, and White House economic adviser Larry Kudlow punted responsibility to Europe, business groups and manufacturers say there's no question Trump's trade war is the real problem.

White House spokesperson Judd Deere told Axios: "The fundamentals of the economy are strong because of this president’s pro-growth policies, and the White House does not see an imminent economic downturn." 

  • "Talks with China are continuing this week, but there is no doubt that President Trump will continue to use every available tool to level the playing field and reduce barriers to the export of our goods and services."

The U.S. Chamber of Commerce's chief policy officer Neil Bradley, who has worked closely with the Office of the United States Trade Representative on the Trump administration's pending trade agreements, tells Axios he's been "concerned about the outlook for the manufacturing sector for some time now."

  • "When businesses begin to decline, one of the first sectors to be impacted by that is manufacturing," Bradley said. "The next few months are critical. Either confidence [in the markets] is going to be restored, or that lack of confidence from the tariffs will continue to spread. And that's when you risk a recession."
  • Meanwhile, the president of the National Association of Manufacturers, Jay Timmons, said that optimism among their members is declining — and the lack of clarity surrounding USMCA and tariffs has put “a chill on business investment decisions” in the sector.

The bottom line: Counties with local economies that rely on manufacturing overwhelmingly supported Trump in 2016 and celebrated the "Trump bump" that accompanied him when he took office. But those votes could be in jeopardy as uncertainty continues to grip the industry.

Go deeper

Updated 5 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 10 p.m. EST: 32,135,220 — Total deaths: 981,660 — Total recoveries: 22,149,441Map.
  2. U.S.: Total confirmed cases as of 10 p.m EST: 6,975,980 — Total deaths: 202,738 — Total recoveries: 2,710,183 — Total tests: 98,481,026Map.
  3. Politics: House Democrats prepare new $2.4 trillion coronavirus relief package.
  4. Health: Cases are surging again in 22 states — New York will conduct its own review of coronavirus vaccine.
  5. Business: America is closing out its strongest quarter of economic growth.
  6. Technology: 2020 tech solutions may be sapping our resolve to beat the pandemic.
  7. Sports: Pac-12 will play this fall despite ongoing pandemic — Here's what college basketball will look like this season.
  8. Science: Global coronavirus vaccine initiative launches without U.S. or China — During COVID-19 shutdown, a common sparrow changed its song.
8 hours ago - Sports

Pac-12 will play football this fall, reversing course

A view of Levi's Stadium during the 2019 Pac-12 Championship football game. Photo: Alika Jenner/Getty Images

The Pac-12, which includes universities in Arizona, California, Colorado, Oregon, Utah and Washington state, will play football starting Nov. 6, reversing its earlier decision to postpone the season because of the coronavirus pandemic.

Why it matters: The conference's about-face follows a similar move by the Big Ten last week and comes as President Trump has publicly pressured sports to resume despite the ongoing pandemic. The Pac-12 will play a seven-game conference football season, according to ESPN.

Dave Lawler, author of World
9 hours ago - World

Global coronavirus vaccine initiative launches without U.S. or China

Data: Gavi, The Vaccine Alliance; Map: Naema Ahmed/Axios

A global initiative to ensure equitable distribution of coronavirus vaccines now includes most of the world — but not the U.S., China or Russia.

Why it matters: Assuming one or more vaccines ultimately gain approval, there will be a period of months or even years in which supply lags far behind global demand. The COVAX initiative is an attempt to ensure doses go where they're most needed, rather than simply to countries that can produce or buy them at scale.

Get Axios AM in your inbox

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Subscription failed
Thank you for subscribing!