Will Manufacturing Jobs Be Coming Back To America?

It's hard to give Donald Trump credit for much of anything, but one thing he deserves some degree of credit for is rhetorical and philosophical consistency on the topics of tariffs and economic protectionism.  He has believed in these things long before he got into politics and is defying the overwhelming consensus of both economists and public opinion with his supersized tariff scheme.  So even if we assume that wielding his sovereign-sized Excalibur on the global stage is Trump's strongest motivation for the tidal wave of tariffs he's deployed--and then summarily rolled back--in the last two months, he's sincere in his belief they will lead to a more independently functioning America, and that that would be a good thing.

This puts him on the same side of this issue as a lot of labor unions, so it's not a big surprise that he's cleaved off such a large share of the union vote by peddling this protectionist message.  So that begs the question.  Is there any chance that he's gonna be proven right?

The easy answer is that it's a major long shot, but this is a guy who has defied unimaginable odds to prevail in two Presidential elections, so underestimate his ability to reveal yet another royal flush with his poker hand at your own risk. The experts are assured Trump is hopelessly misguided with his economic policy, and I tend to agree with them, but a little humility is in order on these things until we actually start seeing the results. 

While I may not be 100% convinced that hefty and broadly applied tariffs won't accomplish the intended goal of boosting domestic manufacturing capacity, I can predict with far more confidence that it won't play out as cleanly or as beneficially as MAGA voters expect it to.

Let's break down the biggest challenges to weaponizing tariff policy for long-term economic realignment goals.  The core conundrum here is that most people are impatient.  Asking voters to play the long game and endure hardship has been an electoral loser at least since Jimmy Carter suggested Americans should turn down the thermostat and put on a sweater if they wanted to reduce energy bills.  Trump is asking Americans, who voted for him largely because of a boomlet of inflation that occurred during his predecessor's term, to withstand thousands of dollars per household of additional inflation every year based on a hypothetical promise of a pot of gold at the end of a very, very long rainbow.  But Trump knows most people don't have that kind of patience, which is why he's been spooked into rolling back the overwhelming majority of tariffs that he's imposed since April 2, attempting to dodge the groundswell of rage he knows will be coming in the event of significant inflation or empty shelves.

Let's suppose a majority of Americans were willing to endure this bargain and stand by their man at the polls until the desired outcome materialized.  If that was the case, Trump's original behemoth tariffs may have worked--in a qualified way and with incredible short-term pain that would take years to bounce back from--in incentivizing companies to bring manufacturing back to America.  But scaling back those tariffs to the 10% baseline as he's done since is far less likely to bring about the intended goal.  Factories operating in countries with lower labor, regulatory, and administrative costs will need more of an incentive to build a new plant in Flint, Michigan, than a mere 10% tariff if they remain abroad.

With that in mind, it's hard to see any outcome of such modest tariffs than just....inflation.  Trump wants to have it both ways with tariffs that are small enough to keep Wall Street and consumers from getting "yippy" but not large enough to have much chance of shifting manufacturer behavior. 

Trump actually has a small degree of leverage with public opinion because, in the abstract, a good-sized chunk of the electorate agrees with his core philosophy and are willing to give him a long leash to corral manufacturing back to America.  That's one of the reasons his approval rating has only ticked down a bit in the last two months.  Little to no hardship has been felt yet in working-class America because of the tariffs, but even if and when it is amidst a probable near-term recession, most of Trump's voters will stand by him because they believe in the cause.  It'll be far less than a majority of the American public, but not enough to create a political earthquake and turn many red states blue in the 2026 midterms or the next Presidential election.

Then the question begs itself: what should Trump's base expect as their reward for standing by him, especially if the tariffs somehow work and we're three years away from a manufacturing renaissance?  Will the farm and factory towns left for dead return to their mid-20th century glory days?  Will a virtuous cycle of private sector investment transpire to mend all that has been broken in the last half century in rural and industrial America?  Will the valedictorians of small-town high schools be inclined to stick around after graduation to lay down roots in a way they haven't in most people's lifetimes?

Not a chance.

Voters with romanticized expectations of towering plants on the edge of town employing 1,000 or more union workers are gonna be disappointed with what they end up getting even in the best-case scenario of tariff-induced domestic reinvestment.  Most of the jobs we'd be getting would be low-value light manufacturing.  Think tennis shoes or lunch boxes or crayons.  They'd be small operations with low pay, and that's if they employed any actual humans at all.  And even if we got manufacturing plants that made generators or something with more value and higher pay, job availability wouldn't resemble anything like the plants their grandparents were used to.  In the mid-2020s, it's a matter of whether the plants will be mostly automated or fully automated.

Now let's say automation advancements fall behind expectations and the new plants need more human capital than may be expected.  Light manufacturing jobs would still offer low pay, just as the existing domestic light manufacturing jobs do that always have "Help Wanted" signs on their doors.  In other words, the depopulating rural and industrial communities hosting these new plants wouldn't be any better positioned to fully staff them than their current employers are.  In fact, as the workforce continues to shrink with the retiring Baby Boomers and the plummeting birth rate, finding workers for low-wage jobs will get harder rather than easier.

What does that mean?  Immigrants.  Any scenario where millions of new light manufacturing jobs resurface in a nation with a fast-shrinking labor force means a greatly expanded need for immigrant labor to assemble the tennis shoes and lunch boxes, or even generators, domestically.  I'm sure the number of MAGA voters who've even considered this is very close to zero, and I also bet most wouldn't be very happy about it if it came to pass.  They sure weren't in Springfield, Ohio, where this scenario has already unfolded at a localized level.

And while there's a "chicken versus egg" debate that could be had here, most major employers are gonna be reluctant to locate anyplace with a shrinking labor force and schools and hospitals that are either already closed or on the knife's edge.  Recent reports showed that fully 20% of America's hospitals are teetering on that knife's edge, a strong breeze away from inevitable closure.  But that strong breeze is about to become a tornado in the form of $723 billion in Medicaid cuts serving as the centerpiece for Trump's "big beautiful bill" currently on the cusp of passing Congress.  The inevitable closure of hundreds more hospitals brought about by these Medicaid cuts is certainly not gonna make dying farm and factory towns more attractive for would-be employers, even the ones newly incentivized to find a domestic home for their lunch box factory.

A good case can be made for manufacturing more at home.  COVID exposed that we're too dependent on the goodwill of trading partners, and it made us more vulnerable than we should have been to supply chain disruption. Of course, there's at least as much risk of being too independent of trading partners, the ensuing global isolation leading to the 1930s-style conflicts that have historically always come amidst isolated cultures.  There's no silver bullet when it comes to geopolitical equilibrium. 

And there's no denying that it was a catastrophic political mistake and failure of imagination to let our manufacturing sector drift away with the expectation that something--anything--would fill the void in the hollowed-out communities that remained after the factories went to China.  Still, the muscular effort by the Trump administration to restore Pax Americana manufacturing employment is probably coming two generations too late for the desired effect.  If these tariffs were imposed in 1985 or 1995, when the workforce was abundant and the communities' infrastructure had not yet dissolved, Trump's gambit may have had a puncher's chance of working.  But even then, it might have been a net negative if it stalled out dynamism in other economic sectors insurgent at the time.

By 2025, the patient has already bled too much and for too long to be saved.  Biden's infrastructure bill and unrealized Build Back Better concepts were probably the best hope rural and industrial communities had for smoothing out the edges and managing their decline.  The private sector drove the decimation of blue-collar America because it no longer had a use for them.  Unless and until the private sector decides they need blue-collar America again, it's hard to believe the same people who tore it apart will choose to put it back together, even amidst the most heavy-handed possible government intrusion like large tariffs.  If Trump proves me and his other detractors wrong once again, then hats off.  But making Midwestern steel towns and Deep South mill towns look like they did when our grandparents were alive is gonna be a much more daunting task even than getting elected President twice.