American companies said they cut more than 10,000 jobs because of trade tensions in August

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American companies said they cut more than 10,000 jobs because of trade tensions in August

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  • American companies slashed thousands of jobs last month because of the yearlong trade dispute between the Trump administration and China, according to a new report.
  • Employers announced plans to eliminate 10,488 positions throughout August because of "trade difficulties," Challenger, Gray & Christmas, Inc. said in a monthly release.
  • Hundreds of companies have pushed back against the trade war over the past year, saying tariffs would raise prices and cast uncertainty on business plans.
  • Visit the Markets Insider homepage for more stories.

American companies slashed thousands of jobs last month because of the yearlong trade dispute between the Trump administration and China, according to a new report.

Employers announced plans to cut 10,488 positions throughout August because of "trade difficulties," the staffing firm Challenger, Gray & Christmas, Inc. said in a monthly release.

The report appeared to highlight lower confidence among investors and employers who expected a slowdown in demand for products and services, said Andrew Challenger, the vice president of Challenger, Gray & Christmas, Inc.

"Employers are beginning to feel the effects of the trade war and imposed tariffs by the US and China," Challenger said. "In fact, trade difficulties were cited as the reason for over 10,000 job cuts in August."

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The official Labor Department report painted a similar picture of the labor market on Friday, showing the US added 130,000 nonfarm payrolls in August. But that figure was lifted by temporary hiring in the federal government, while the pockets of the economy most sensitive to trade showed signs of cracking. The manufacturing sector created only 3,000 jobs last month.

"The breadth of the softening among private services was concerning," said Josh Wright, the chief economist at iCIMS, a recruiting software company. "Manufacturing and especially retail trade were weaker than most, suggesting that trade tensions are impacting these sectors."

In official testimony presented to the Trump administration, hundreds of companies have pushed back against the trade war over the past year. While some supported efforts to address Chinese trade practices seen as unfair, they warned tariffs would raise prices and cast uncertainty on business plans.

"This will result in an annual cost increase that exceeds $10 million, and eliminates our annual profits entirely. If sales decline, overhead and labor costs will need to be reduced, leading to the elimination of jobs, which in turn, will make our operation unsustainable," said Jim Day, who represented 47 Brand, LLC at public hearings in June.

The White House has admitted in recent months that its trade policies could pose challenges for companies and consumers at home, delaying a portion of planned escalations until after the holiday shopping season. But President Donald Trump has at the same time sought to downplay concerns about the economy and shift broader blame onto others.

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"The Economy is great," the president wrote on Twitter following the jobs report Friday. "The only thing adding to 'uncertainty' is the Fake News!"

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