Central to the Trump Administration’s ongoing tariff mayhem is their fantasy that one of the outcomes of the implemented policies will be to bring back the glory days of American manufacturing.
In an April 7 White House article, the Administration wrote, “As he [President Trump] puts into action his bold plan to reverse the decades of globalization that has decimated our industrial base, President Trump is putting the Forgotten Men and Women of America first.”
The article then cited five ‘everyday Americans’ who support Trump’s trade action, of which only two were involved in manufacturing – a retired autoworker and a bike manufacturer.
While the idea of job creation is always a solid goal, the reality is that the state and dynamics of American manufacturing can likely never return to their heyday of the 1970s.
Much has changed since the peak manufacturing employment in 1979, when over 19 million Americans were employed in the sector.
The United States Bureau of Labor Statistics’ March 2025 Manufacturing Workforce Report shows that just 8.9 million Americans are currently employed in the sector.
Technology, automation, and increased efficiencies mean that far fewer employees are required in manufacturing today. Take that a 2024 US Department of Commerce report found that the average American manufacturer employs just 20 workers.
It will take a momentous – and unrealistic – shift to see manufacturing employment numbers similar to those of the 1970s.
Even if the administration is correct in its assessment that companies will begin mass-building new factories on US soil, who will ensure that the jobs created are high-paying?
The reality is that manufacturing jobs of years-gone-by were the solid, high-paying jobs that workers wanted, not because of the generosity of the factory owners but because of the strength of organized labor.
Organized labor in the United States has been decimated.
While the total number of unionized workers peaked in 1979 at 21 million, as a percentage of the total workforce, the peak was in 1954 at just over 28% of workers being unionized. Specifically, in the manufacturing industry, in March 2025, only 7.8% of workers are union members.
Furthermore, the average hourly earnings of manufacturing workers currently is $28.92 (March 2025), which is far lower than the average hourly earnings for all employees on private non-farm payrolls, at $36.00 (March 2025).
If the average hourly earnings for manufacturing workers is more than 20% lower than that of the average of all nonfarm workers, how is that putting the forgotten men and women of America first?
What incentive will there be for any new manufacturer to pay higher wages?
Not much.
Consider that any company that shifts its manufacturing operations to the USA must figure out how to ensure its sales revenue does not fall.
Currently, manufacturers operating on foreign soil benefit from exporting to the US market (and other countries) and selling domestically within their own borders.
Moving to the US would likely mean losing much – if not all – of their current country’s domestic sales. Further complicating the issue is that many countries are issuing reciprocal tariffs on US goods, meaning there will be little appetite for them to export their goods outside the USA.
That leaves the American consumer to make up the difference in sales.
But the American consumer is already facing higher prices on many goods, and assuming that they will be willing to extend themselves further to purchase a more costly USA-made product is risky.
Just last month, the University of Michigan’s consumer sentiment survey found that US consumers are not optimistic:
“For the third straight month, plummeting 12% from February. The expectations index plunged a precipitous 18% and has now lost more than 30% since November 2024.”
Interestingly, Trump’s base isn’t confident in the current economic environment either.
The survey showed that Republicans agreed with independents and Democrats in “expressing worsening expectations since February for their personal finances, business conditions, unemployment, and inflation.”
Furthermore, “consumers continue to worry about the potential for pain amid ongoing economic policy developments.”
Finally, the report concluded that “notably, two-thirds of consumers expect unemployment to rise in the year ahead, the highest reading since 2009.”
With the prospect looking slim for Trump’s resurgence of a manufacturing Golden Age dream coming into reality, it will be the American worker and consumer who will be left living a higher-cost-of-living nightmare.