In November, net employment in the United States manufacturing sector fell by 5,000 jobs. This continuing drop foretells a troubling direction as the sector reaches its lowest level of employment since March 2022. Manufacturing jobs have now fallen for seven consecutive months. A lot of people point to the tariffs that President Donald Trump placed on certain goods as the culprit of this perfect storm. Tariffs on key imports such as steel, aluminum, and copper are creating huge burdens for US manufacturers. In response, businesses are slowing down hiring and even making more cuts across the entire sector.
These tariffs have really made a difference. They are helping, through their pallid economy, to tortoise along a world-wide slowdown in the cyclical parts of the economy. Stephanie Roth, a trade and manufacturing economist, wrote that today’s drop in manufacturing employment is a reflection of these tariff-fueled hardships. Roth expects the shock effect of the tariffs to lessen. He hopes that this would help enhance job creation across blue-collar industries.
The Broader Employment Landscape
The new job numbers show a varied picture among different industries. Manufacturing still has tough times ahead. In stark contrast, the health care and social assistance industry is booming, contributing 64,000 new jobs just in November by itself. That’s the highest number of jobs this sector has added in the last year — nearly 800,000! This growth is a world away from the headwinds buffeting manufacturing.
Unlike health care, the transportation and warehousing industry has been hit hard by the recent losses. This sector has slashed jobs for the last three months, a sign of ongoing economic headwinds. On the downside, mining and logging payrolls continue to decline at an average -2,000 jobs/quarter.
Michael Reid, senior industry analyst for the information technology industry, called attention to the increasing challenges that business face as their input costs increase. He continued, “When input costs increase, one of the easiest things to do is to reduce labor. These trends point to a business bias toward cutting costs rather than expanding the workforce in times of economic distress.
The Construction Sector’s Resilience
All other industries may be feeling the bust downturn, but construction is one of the bright spots in this jobs recovery. That was not the case in November, when the sector added an impressive 28,000 jobs. Over the past three months, it has averaged gains of 17,333 jobs. This expansion provides a much-needed lifeline to the blue-collar workers who have suffered most during our recent economic roller coaster.
Hardika Singh, an employment expert, said that for blue collar workers, small businesses are a lifeline. These same small businesses are struggling like never before with inflation and high interest rates. Singh underscored the crucial contribution small businesses make to producing jobs for those without a college education. Their stability is key to the entire employment landscape.
As we know, President Trump is already campaigning hard, trying to keep himself re-elected in 2024. He campaigned on a promise to create a “blue-collar jobs boom.” Trump’s promises have included statements about delivering “millions and millions of blue-collar jobs and jobs of every type.” The latest hiring numbers indicate that goal might be harder to reach than expected.
Looking Ahead
So the route to recovery for manufacturing and other blue-collar sectors will not come as quickly. As Michael Reid explained, reshoring—bringing production back to the United States—“It doesn’t happen overnight. Not even in six or seven months’ time. It takes several years.” So, despite some cause for optimism with respect to job growth as the impacts of the tariffs recede, serious problems still lie ahead.