Accounts from manufacturers in the Institute for Supply Management survey on Monday painted a dire picture of the factory sector, which ironically President Donald Trump’s sweeping duties are intended to stimulate. Economists have long argued it was impossible to restore manufacturing to its former glory because of structural issues, including worker shortages.
“Tariffs have been roiling the sector for much of this year,” said Stephen Stanley, chief U.S. economist at Santander U.S. Capital Markets. “The comments from individual respondents suggest that firms are exhausted by all of the back and forth on tariffs since the beginning of April and are suffering mightily as their customers have pulled back significantly.”
The ISM said its manufacturing PMI fell to 48.7 last month from 49.1 in September. A reading below 50 indicates contraction in manufacturing, which accounts for 10.1% of the economy.
The PMI remained above 42.3, a level that the ISM said over time was consistent with an expansion of the overall economy.
Economists polled by Reuters had forecast the PMI rising to 49.5. Six industries including primary metals, transportation equipment and fabricated metal products reported growth. Among the 12 industries that contracted were textile mills, wood and chemical products as well as electrical equipment, appliances and components, machinery, and computer and electronic products.
PicoRascar on
Trump increased the cost of manufacturing inputs through tariffs and sent international purchasers of manufacturing outputs searching for alternative markets because of tariffs. This was an obvious outcome.
econheads on
It’s wild we’re still pretending tariffs alone can bring factories back. You can’t just slap taxes on imports and expect a supply chain to rebuild itself. The people, skills, and supplier networks that made U.S. manufacturing competitive don’t exist like they used to.
Now companies are paying more for parts that take longer to arrive, while local production can’t fill the gap. That’s not protecting jobs, that’s bottlenecking them.
If tariffs had been paired with serious investment in training, automation, and infrastructure, maybe this would’ve made sense. Instead, it feels like a political fix for an economic problem that needs actual strategy.
ICLazeru on
“the cost to import in many cases is still more attractive than sourcing within the U.S.”
So the tariffs are driving up domestic production costs without even giving them a gain in marketshare. Prices are rising for no other reason than to funnel cash out of the company and consumer pockets and into the federal government.
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From the article:
Accounts from manufacturers in the Institute for Supply Management survey on Monday painted a dire picture of the factory sector, which ironically President Donald Trump’s sweeping duties are intended to stimulate. Economists have long argued it was impossible to restore manufacturing to its former glory because of structural issues, including worker shortages.
“Tariffs have been roiling the sector for much of this year,” said Stephen Stanley, chief U.S. economist at Santander U.S. Capital Markets. “The comments from individual respondents suggest that firms are exhausted by all of the back and forth on tariffs since the beginning of April and are suffering mightily as their customers have pulled back significantly.”
The ISM said its manufacturing PMI fell to 48.7 last month from 49.1 in September. A reading below 50 indicates contraction in manufacturing, which accounts for 10.1% of the economy.
The PMI remained above 42.3, a level that the ISM said over time was consistent with an expansion of the overall economy.
Economists polled by Reuters had forecast the PMI rising to 49.5. Six industries including primary metals, transportation equipment and fabricated metal products reported growth. Among the 12 industries that contracted were textile mills, wood and chemical products as well as electrical equipment, appliances and components, machinery, and computer and electronic products.
Trump increased the cost of manufacturing inputs through tariffs and sent international purchasers of manufacturing outputs searching for alternative markets because of tariffs. This was an obvious outcome.
It’s wild we’re still pretending tariffs alone can bring factories back. You can’t just slap taxes on imports and expect a supply chain to rebuild itself. The people, skills, and supplier networks that made U.S. manufacturing competitive don’t exist like they used to.
Now companies are paying more for parts that take longer to arrive, while local production can’t fill the gap. That’s not protecting jobs, that’s bottlenecking them.
If tariffs had been paired with serious investment in training, automation, and infrastructure, maybe this would’ve made sense. Instead, it feels like a political fix for an economic problem that needs actual strategy.
“the cost to import in many cases is still more attractive than sourcing within the U.S.”
So the tariffs are driving up domestic production costs without even giving them a gain in marketshare. Prices are rising for no other reason than to funnel cash out of the company and consumer pockets and into the federal government.