Back in April, President Donald Trump touted his aggressive tariff policy as a catalyst for the reshoring of manufacturing jobs. Eight months later, reshoring progress is nowhere to be seen.
The jobs report from the Bureau of Labor Statistics released last week found that while nonfarm payrolls increased by 119,000, there were 6,000 fewer manufacturing jobs, adding to the tally of 59,000 lost factory jobs since Trump’s April vows to ignite domestic manufacturing. The Labor Bureau’s data is consistent with the Institute for Supply Management November report, which indicated an eighth consecutive month of contracting manufacturing jobs.
“The US is losing blue-collar jobs for the first time since the pandemic…as manufacturing industries lose jobs at a rapid pace while growth in construction & transportation has nearly zeroed out,” economic commentator Joseph Politano noted in a LinkedIn post last week.
In a frozen white-collar job market, blue-collar trade and factory jobs have been seen as a safe haven for not just Gen Z, but antsy office workers more broadly. But fewer manufacturing jobs mean job prospects in this low-fire, low-hire market may be bleaker than even some workers anticipated.
The shrinking manufacturing opportunities, meant to be a balm for domestic labor woes, are ironically a result of Trump’s whipsaw tariff policy intended to restore factory jobs, according to Laura Ullrich, director of economic research at the Indeed Hiring Lab.
“It is striking how soft manufacturing has been because in theory, you put tariffs in place to protect domestic manufacturing, so that domestic manufacturing employment grows,” Ullrich told Fortune. “And we have seen the opposite of that.”
Tariff troubles
Ullrich attributes the contracting manufacturing sector in part to the uncertainty tariffs have brought, which has disincentivized companies from growing their workforce. In a September note to clients, Pantheon Macroeconomics analysts Samuel Tombs and Oliver Allen attributed shrinking wage growth in the U.S. to tariff-struck companies trying to maintain margins by trimming labor costs. Similarly, Ullrich argued, companies trying to navigate new variables are usually less concerned with growth.
“Oftentimes when there is heightened uncertainty, it’s just difficult for businesses and people to make decisions in real time,” she said. “And so that slows down employment. It slows down all those processes.”
To be sure, nearly all jobs—with the exception of the health care and leisure hospitality sectors, which continue to grow and include many blue-collar roles—have stagnated as a result of economic uncertainty, Ullrich noted, but manufacturing jobs may have another vulnerability due to tariffs.
Trump’s tariffs have had an impact on intermediate goods, or products used in the process of creating a final, finished good. These levies have hiked up input and production costs, which can discourage hiring. A study published this month in the American Economic Journal: Economic Policy found that during former President George Bush’s second term in 2002, his steel tariffs did not improve local steel manufacturing unemployment, but rather depressed it, even years after the tariffs were removed.
“When you tax the intermediate goods, that’s going to manufacturers directly,” Ullrich said. “That’s part of what we’re seeing.”
Labor mismatch
The latest jobs report doesn’t tell the full story on manufacturing, however. Ullrich cited Indeed data that found job postings for manufacturing jobs have remained resilient, despite a contracting industry. She said while there are fewer job opportunities, the sector is still seeing a shortage of individuals qualified for manufacturing work.
“Some of the declines in blue-collar employment could be about labor demand going down,” Ullrich said. “But it also could be about labor supply shortages and a mismatch between the jobs that are available and the skills that people have to fill those jobs.”
Earlier this month, Ford CEO Jim Farley lamented in an episode of the Office Hours: Business Edition podcast that Ford had 5,000 open mechanic roles, some with a salary of $120,000, that the company was unable to fill. A 2024 survey from the Manufacturing Institute and Deloitte of more than 200 manufacturing companies, more than 65% of firms said recruiting and retaining workers was their biggest challenge.
It could be, then, that despite fewer manufacturing opportunities out there today, pursuing trade skills could be valuable in finding a job. Enrollment in trade schools and programs has been on the rise across the country, a sign young people are not giving up on manufacturing jobs anytime soon.
“More kids are realizing they can go out and earn a great living with an amazing career and making very good money,” Matt Scott, a welding instructor at Portland Community College in Oregon, told KATU in July.
