The Trade War’s Impact
Some economists feared that Mr. Trump’s trade war could be the shove that pushed the United States into a recession. But there is little evidence of that. Manufacturers added 17,000 jobs in June, the most since January. Data from the Institute for Supply Management this week showed that the industry’s struggles continued in June, although the decline wasn’t as severe as some economists had predicted.
In addition, the much larger service sector regained its footing in June after unexpected weakness in May. Retailers continued to shed jobs, but those cuts were more than offset by increased hiring by warehouses and trucking companies, which are benefiting from the rise of online shopping. Other consumer-driven industries also added jobs, a sign that consumers have not lost confidence in the economy’s strength.
“Confidence is high, income growth is strong, layoffs are basically zero,” Mr. Shepherdson said.
Still, economists say they don’t expect manufacturing to be the engine of growth that it was early in Mr. Trump’s term.
At Taco Metals, a Miami-based manufacturer of equipment for the recreational marine industry, tariffs have meant higher costs for the raw materials and parts it imports from China and other countries. That has added to fears from boat builders and dealers about how long the good times can last in an industry that is highly sensitive to the broader economy.
“The tariffs just kind of forced people to think twice about is this going to continue,” said Bill Kushner, a vice president at the company. “There’s starting to be more hesitation on both the manufacturing side and the dealer side.”
As customers pull back, Mr. Kushner’s company, which employs about 150 workers in Florida and Tennessee, is doing the same. They are holding off on some equipment purchases and waiting to fill some positions.
“It’s just caused us to take a little step back and reassess some of the direction and make sure we’re not jumping the gun,” Mr. Kushner said. “It’s like, ‘Well, are we sure we’re going to need to do this, or should we try to outsource?’”
