While the latest report from South Carolina’s Department of Employment and Workforce (SCDEW) shows rising numbers in job placement, the White House’s imposed tariffs and trade war with China has weakened employment growth in the state’s $34 billion manufacturing sector, according to Clemson Economist, Bruce Yandle.
“It’s hard to win a trade war and consumers ultimately bear the cost when they confront higher priced goods,” he said. As one of the nation’s most specialized export manufacturing economies, “our state’s high level of prosperity is at risk.”
Using numbers not seasonally adjusted, the report only showed an increase of 300 workers in the state’s manufacturing space during April.
Despite slowed manufacturing numbers, SCDEW’s Executive Director Dan Ellzey, said South Carolina is enjoying unprecedented employment growth.
From Jan. 1, to April 30, approximately 21,000 individuals found employment, he continued.
While job growth is on the rise, the state’s seasonally adjusted unemployment rate ticked upward to 3.4 percent from March’s estimate of 3.2.
“When more people enter the labor force than there are jobs created, it causes the unemployment rate to nudge up,” Yandle said. “South Carolina is a services economy and employment gains are largest in this sector, with professional and business services leading the way.”
Back on the state’s manufacturing front, both the U.S. and China are preparing to push for a final agreement in June, even as tariffs go into effect.
Yandle said because China is the key destination for goods produced in both Carolinas and is also the number one source for ours, the Port of Charleston’s exports are weakening as the number of autos through the port fall.
The Trump Administration has imposed 25 percent tariffs on a large selection of Chinese goods and they have retaliated by imposing tariffs on US goods, “especially autos,” he said.
Although U.S. Sen. Tim Scott does not advocate the use of tariff’s, he said “the President’s objective of resetting our economic relationship with China is a necessary fight.”
“I’ve had numerous conversations with the President to discuss the impact that tariffs have on our state’s economy,” he said. “We need to force China to the table to ensure our manufacturing sector is on a level playing field with the rest of the world’s.”
To some state manufacturers, the problem is much deeper than the recent trade war with China.
“For way too long our policy makers on both sides have not championed American manufacturing,” Mark McClure said, VP at International Plastics.
Over the last 40-plus years, “we have been losing through failed policy and trade agreements,” he continued. While American consumers enjoyed cheap Chinese goods, American manufacturing jobs vanished.
McClure said the Trump administration’s tariffs would tell China “we are serious and not afraid to implement them long term if necessary.”
As policy makers meet to negotiate the trade deals with China, “rest assured other topics like IP theft, currency manipulation, cyber hacking and industrial espionage will also be addressed,” he said. “The President is doing the right thing by holding China accountable.”