An analysis by Trade Partnership Worldwide found “the tariffs would increase US iron and steel employment and non-ferrous metals (primarily aluminum) employment by 33,464 jobs, but cost 179,334 jobs throughout the rest of the economy, for a net loss of nearly 146,000 jobs” including more than 28,000 construction jobs.
Gary D. Cohn, a top economic advisor to the Trump Administration, is set to resign in the wake of his fierce opposition to the President’s decision to impose tariffs on steel and aluminum imports. Cohn is expected to leave in the coming weeks, the White House said.
“Gary has been my chief economic adviser and did a superb job in driving our agenda, helping to deliver historic tax cuts and reforms and unleashing the American economy once again. He is a rare talent, and I thank him for his dedicated service to the American people,” Trump said in a statement.
Trump addressed the news on Twitter Tuesday evening and said a decision would come soon.
“Will be making a decision soon on the appointment of new Chief Economic Advisor. Many people wanting the job – will choose wisely!” Trump tweeted.
Officials said no one factor led to Cohn’s decision, but it came as he strongly opposed the President plan to impose 25% tariffs on steel and 10% tariffs on aluminum imports.
Industry has reacted sharply to the tariffs, with many sectors including machinery, construction and financial warning that such a measure would have negative impacts while some manufacturers said it would shore up American economy, creating jobs and preserving national security.
“We wish Mr. Cohn the best of luck and thank him for his service.
“Our focus remains on working with Congress and the Trump administration to explain the significant, negative, impacts the proposed tariffs will have on the construction industry and remain hopeful we can find a more appropriate solution to the President’s trade concerns,” said Brian Turmail, Associated General Contractors of America’s VP of Public Affairs & Strategic Initiatives.
Last week the group had called on the White House and federal agencies to avoid triggering a “trade war,” saying the tariffs would undermine the administration’s goals of dramatically boosting infrastructure investment and achieving sustained higher economic growth.
An analysis released Monday by Trade Partnership Worldwide, an international trade and economic consulting firm, found “the tariffs would increase US iron and steel employment and non-ferrous metals (primarily aluminum) employment by 33,464 jobs, but cost 179,334 jobs throughout the rest of the economy, for a net loss of nearly 146,000 jobs” including more than 28,000 construction jobs.
“While employment increases in sectors making steel and aluminum, it declines in every other sector of the U.S. economy. Employment effects do not take into account any potential retaliation against U.S. exports; only of the tariffs themselves.”
Meanwhile, the Alliance for American Manufacturing urged President Trump to follow through on the measure in order to boost domestic jobs.
“We’re on the brink of a potentially historic rebalance of America’s trade priorities,” said AAM President Scott Paul. “A decision to restore sanity to global steel markets will help create domestic jobs and preserve our national security.”
Analysts already have downgraded stocks of machinery companies that are vital for the construction industry since the tariffs could strain their supply chain.
For example, Robert W. Baird analyst Mircea Dobre downgraded Terex Corp., Oshkosh Corp., Manitowoc Co. and Hyster-Yale Materials Handling Inc. The aerial work platforms and cranes seem most vulnerable since pricing can be compressed by foreign competitors with lower raw material prices, Dobre said.
William Blair’s Larry De Maria said that if a trade war ensues, the upside in Caterpillar Inc. shares could be limited. “The biggest concerns for Caterpillar that could derail a potential multi-year upcycle include geopolitical risk globally, political risk in the United States, and a trade war.”
“A real trade war could potentially damage global trade and that would provide a real risk to the outlook,” he said, adding that the scope of potential retaliation from other countries and trade groups is harder to quantify.
Meanwhile, U.S. stocks fell as President Trump’s tariff plans appeared to gather force. The dollar weakened against the Japanese yen and euro.
The Dow opened down more than 300 points on Wednesday before recovering some of those losses. The S&P 500 and the Nasdaq were down about 0.5% each by mid-morning, as the market was absorbing the ramifications of Cohn’s resignation.
“His departure has caught investors off guard,” said Alec Young, FTSE Russell’s managing director of global markets research.