With a tariff on steel, 146,000 jobs can be closed in the US

California Steel mill, which turns semi-finished steel into rolled coils Photo: Cláudia Trevisan / Estadão
California Steel mill, which turns semi-finished steel into rolled coils Photo: Cláudia Trevisan / Estadão

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Measure Will Cause Loss of Stations in Industries Using Steel as Input, Study Says

FONTANA AND LOS ANGELES – Studies released in the United States in recent days have estimated that the 25% tariff on steel imports will have a more negative than positive impact on job creation in the country. The Trade Partnership, an institution dedicated to the defense of free trade, estimates that there will be a net loss of 146 thousand jobs, resulting from the creation of 33,464 positions in the steel industry and the loss of 179,334 in other sectors of the economy that use steel as an input .

A similar impact occurred in 2002 when then-President George W. Bush imposed tariffs on steel imports, albeit far more punctually than the broad barrier erected by Donald Trump, the current White House occupant.

A study commissioned by the Trade Partnership at the time estimated that Bush’s protectionism destroyed 200,000 jobs during the 18 months it was in force. The number surpassed the total number of people employed in steelmaking, which was 187,000 in December 2002.

Another analysis made at the time by the Peterson Institute for International Economics concluded that the tariff led to the creation of only 3,500 jobs in the steel industry. But the small expansion had an astronomical cost for American consumers, in the form of price increases due to higher steel prices. The study estimated that each of these jobs cost $ 400,000.

“Tariffs are certainly going to help the steel and aluminum industries expand their profits and expand their output to some extent but they will probably not bring back lost jobs,” economist Eswar Prasad wrote in a study published by the Brookings Institution on Friday, market. According to him, much of the reduction of jobs in the sector is due to technology and automation.

To justify the protectionist measure, President Donald Trump used the defense of national security defense argument, which several countries pledged to challenge at the World Trade Organization (WTO). But his decision to exclude Canada and Mexico and to link the possible application of the tariff on the two countries to the renegotiation of NAFTA was seen by his critics as an extortion attempt to obtain concessions in the commercial area.

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