The U.S. Federal Reserve has released a study that found the tariffs imposed by the Trump administration in 2018 led to higher prices and fewer manufacturing jobs.
The study, written by Aaron Flaaen and Justin Pierce was released in December, reporting that manufacturing production has not increased as a result of the administration’s actions.
U.S. tariffs may have reduced competition domestically, but trading partners responded with retaliatory tariffs that may harm U.S. manufacturers “by decreasing their competitiveness in foreign markets.”
“The traditional use of trade policy as a tool for the protection and promotion of domestic manufacturing is complicated by the presence of globally inter-connnected supply chains,” the Fed said.
“We find the impact from the traditional import protection channel is completely offset in the short-run by reduced competitiveness from retaliation and higher costs in downstream industries”
The Motor & Equipment Manufacturing Association (MEMA) has been a leading voice against proposed tariffs that impact motor vehicle parts suppliers.
The association released a statement in the summer expressing concern about expanding and escalating the tariffs, arguing they leave U.S. companies less able to compete in the global market place.