CLEVELAND, Ohio – President Donald Trump’s plan to significantly increase the number of U.S. manufacturing jobs is probably unrealistic, according to the head of a company that does international economic, business and political research and analysis.
“The fact that there is this promise that manufacturing jobs are going to flood back into the United States and this region is misguided,” said Michael Patrick Weidokal, a native Clevelander, who heads Luxembourg-based International Strategic Analysis. “That is not going to happen. There may be some increase, but nothing to bring back the number of manufacturing jobs we had in the glory days of manufacturing.”
Weidokal is scheduled to be a member of a panel discussion on the issue at 6:15 p.m. today (Jan. 25) at Baldwin Wallace University’s Center for Innovation and Growth, 340 Front St., Berea.
Trump’s plan for strengthening the U.S. manufacturing base includes stopping factory jobs from leaving the country and reshoring, or bringing back business operations and jobs, that have been sent overseas. Trump said he also wants to renegotiate trade deals, such as the North American Free Trade Agreement, or NAFTA, that went into effect in 1994, which he said have put many U.S. workers out of jobs.
On Monday, Trump scrapped plans for the U.S. to join the Trans-Pacific Partnership, or TPP, because he said the agreement would lead to American job loss. Under the TPP, the U.S. would have entered a trade pact with 10 other countries, including Canada, Japan, Malaysia, Mexico and Vietnam.
Weidokal said the thought that the TPP would have been unfair to American workers in Ohio, and other industrialized states, was inaccurate.
See:How could good-paying jobs be created in Ohio? (poll)
“The Trans-Pacific Partnership was a major opportunity for U.S. exporters in the region,” he said. “The TPP included wealthy and emerging markets, so it wasn’t just a trade deal that was going to export jobs.
“There were also very viable markets, including a huge market in Japan, for U.S. exporters,” Weidokal said. “This was an opportunity for exports to grow and for us to enhance our position in Asia at a time when China is so powerful over there.”
But organized labor, whose leaders met with the president Monday, disagree with such an assessment.
“Last year, a powerful coalition of labor, environmental, consumer, public health and allied groups came together to stop the TPP,” said AFL-CIO President Richard Trumka in a news release. “Today’s (Jan. 23’s) announcement that the U.S. is withdrawing from TPP and seeking a reopening of NAFTA is an important first step toward a trade policy that works for working people.”
While Trump and union leaders say the goal is to protect American workers, Weidokal fears rejecting such trade agreements could lead down a slippery slope to protectionism.
“If we start erecting trade barriers, other countries are going to do the same,” he said.
Weidokal said automation and globalization are among the factors making it nearly impossible for the U.S. to return to “the glory days of manufacturing.”
“They may bring the jobs back, but they are not going to employ the number of workers they did in Mexico or China,” he said of reshoring efforts. “If you look at the United States’ economy right now, the level of manufacturing is about the same as it was 20 years ago, but employment in manufacturing has fallen by almost 40 percent.”
The issue of cheaper labor costs, a major driver for decades in U.S. companies moving abroad, will not disappear, Weidokal said.
“If you think about when the previous generations worked in the manufacturing sector, they didn’t have to compete with China and Latin America, Eastern Europe, or the rest of the global economy, where workers will work for a lot less than in the U.S.” he said.
A strong dollar, which makes U.S. exports more expensive than those from competing nations also has had and impact on job growth, Weidokal said. So has slow economic growth globally.
“We haven’t had this long of a period of sluggish growth since the late 1980s in term of the global economy,” he said. “It is becoming increasingly difficult for Ohio and the U.S. exporters to find growth in international markets just because the rates of growth that were there a decade ago, just aren’t there anymore. Emerging markets are slowing down. Developed economies are getting older and their populations are starting to shrink.”
Asia offers an exception, Weidokal said. He added that Ohio businesses that focus on exporting to Asia increase their chances for job growth.
“Right now it is going to be Asia,” he said. “Longer term it will be places like Africa and the Middle East. Ohio exporters need to put a greater focus on them.”
For information about attending the Economic Insights panel tonight, call: (440) 826-2104 or register here.
Follow: @OPinfo
