Image Source: Pixabay
 

There is no manufacturing recovery.
 

ADP Manufacturing Jobs Month-Over-Month

Manufacturing Jobs Month-Over-Month Details

• Negative 22 straight months since April 2024
• Weakness started in September of 2023

Year-Over-Year Change in Manufacturing Jobs
 

ADP Manufacturing Jobs Month-Over-Month
 

Manufacturing jobs have been negative year-over-year for 29 consecutive months dating to September of 2023.

Trump is not to blame for all of this. However, tariffs undoubtedly made matters worse, especially for small- to mid-sized businesses.

Promises Not Delivered

Trump promised a manufacturing revival but did not deliver.

“It is hard to find businesses outside of the AI ecosystem or healthcare that are talking about hiring,” said Richmond Fed President Tom Barkin.

Reuters reports US Factory Headcount Falling Despite Trump’s Promised manufacturing boom

 U.S. manufacturing jobs in December continued an eight-month skid that began last spring after President Donald Trump rolled out aggressive import taxes that he pledged would lead to a resurgence of blue-collar jobs by reshuffling world trade to favor U.S. workers.

But the blue-collar jobs boom hasn’t materialized, adding to the soured sentiment about Trump’s economic policies among households concerned about still-rising prices and uncertainty about the labor market.

Just ask J.B. Brown, CEO of BCI Solutions Inc., a small metal foundry in Bremen, Indiana, that sells to a range of agriculture and heavy equipment makers.

“Every time I hear that manufacturing is booming, I scream at the TV,” Brown told Reuters. His workforce is down to 130 from 240 people over the past 27 months. That’s the fewest the family-owned business has had since at least 1993, when he joined the company.

Brown said he eliminated a shift in September 2023 and has let attrition steadily reduce numbers since then. He said he could cut another 5% of his workers, if necessary, but he’s trying to avoid that to keep ready for the eventual upturn in orders. His capacity now stands at 52%, another low point. “I’ve never been below 70 to 65%,” he said. “This is our first time experiencing that.”

The pace of job creation in the first year of Trump’s second term has fallen more than two-thirds from what it was in the final year under President Joe Biden, to an estimated 49,000 per month in 2025 versus 168,000 per month the prior year.

The U.S. Supreme Court is expected to rule soon on a case that challenged the legality of many of the tariffs imposed under national security laws but touted by Trump as a source of revenue and meant to reclaim U.S. manufacturing supremacy.

The path of employment since the new strategy was put in place, however, shows if anything how difficult it is to reshape labor market dynamics in a $30 trillion economy whose population is aging and in need of aging-related services, where growth is dependent on consumer spending that tends to be concentrated on services like education, healthcare, leisure, and restaurants, and whose workers command a wage premium that causes firms and managers to invest in productivity so they can make goods with fewer man-hours.

Manufacturing employment in the U.S. is now lower than it was for much of Trump’s initial term, which ran from 2017 until his loss to Biden in the 2020 election.

Tariffs will not Make American Manufacturing Great Again

The Reuters report is from the December nonfarm payrolls report, which ADP data again confirms.

The San Francisco Fed notes “about 45% of U.S. imports reflect intermediate inputs to the production of American goods, while the remainder corresponds to imports of final consumption goods.“

Since tariffs are a tax on US consumers and businesses, the continued manufacturing weakness has been expected.

Trump is clobbering small manufacturers and businesses while repeating tariff nonsense.

Trump wants to bring manufacturing back to the US, but tariffs cannot and will not do that. All tariffs will do is raise prices and protect select industries at the expense of every other industry.

The end result is a destruction of small business employment while making the US the high cost producer. No good can come from that.

ADP Payrolls Weak Again, Small Employers with 20-49 Employees Hit Hard
 

Earlier today, I reported ADP Payrolls Weak Again, Small Employers with 20-49 Employees Hit Hard

Businesses with 20-49 employees have negative year-over-year growth for 20 straight months and 24 out of the last 25 months.

Businesses with 50-249 employees have negative year-over-year growth for 13 straight months.

Tariffs are a huge part of those problems. Click on above link for more details.

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