Trump’s tariff may cost the American economy hundreds of thousands of jobs: Goldman Sachs

A new report issued by Goldman Sachs examines how the president Donald Trump The customs tariff will affect that the labor market has found that although this may stimulate increased employment in the field of manufacturing, job losses in other industries that are affected by definitions will lead to a net negative impact on employment throughout the economy.

Goldman Sachs Economists, led by Jean -Hatzius, reviewed historical and academic studies on the impact of customs tariffs on the labor market in the industries protected by definitions and estuary industries that depend on imports of customs tariffs.

Economists said: “Some studies have found examples that customs tariffs may be effective when applied to emerging industries, or products with high flexibility to demand in particular, or products with a lower scope of cost effects on estuary industries,” Economists said. “However, the existing broad definitions offered by the Trump administration do not target these types of industries and products.”

The report indicated that the Trump administration plans to raise the actual US tariff rate by 15 percentage points (PP) and that academic studies that they reviewed generally indicate an increase of 10PP in international tariff rates enhances employment in protected industries by 0.2 % -0.4 %, but the increase of 1p in customs tariff costs by 0.3 % -0.6 %.

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“This historical flexibility indicates that protection is from Trump’s tariff Economists wrote that manufacturing workers are less than 100,000 (with estimates ranging from 0-240 km), but the costs of high inputs will lead to a selection of about 500 thousand on employment (with estimates ranging from 0-1MN).

The broader statistical guide refers to Passive negative employment Effects, “explain.” Expanding the scope of these estimates to the American economy means a batch less than 100,000 for manufacturing employment from protecting customs tariffs, but approximately 500,000 recruitment towards the river course from the pressure of the input cost. “

In general, this estimate indicates that employment in the American economy will reduce the total employment by 400,000 jobs even after the account increased in the employment in Protected manufacturing Industries.

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The analysis was martyred with three examples of the circumstances in which the customs tariff helped to develop local industries and the estuary industries. These include targeted tariffs that aim to Protection of emerging industriesLike an introductory MCKINYY effect on the year 1890 on the American shanty manufacturing, and the manufacturing process in South Korea.

Another example includes strengthening the local manufacturing of highly flexible goods to import, such as the US tariff for European capture trucks of the 1960s, which has restricted severe imports to support the manufacture of light trucks. Customs tariffs on products that are not intermediate commodities and do not affect manufacturers of manufacturers may enhance local employment, such as definitions of Japanese motorcycles imposed to help Harley-Davidson.

However, the economists in Goldman emphasized that Trump’s tariff is broader and is not implemented in ways that do not focus on infant industries, highly elastic goods for demand or final products. This leaves statistical analysis that shows that although tariff plans may help in employment in manufacturing, it is likely that this mesh clouds in general. United States employment.

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Economists said: “The scope of estimates – especially about the effects of employing high input costs – is considered large and it is difficult to have confidence in the pure influence, especially given that there is no increase in the historical tariff in size and its breadth by President Trump.”

They added, “But these estimates often indicate a negative impact on the protection of trade on employment, even before the employment is calculated from the slowdown in the growth that we expect under our basic outlook,” they added.

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The latest forecast of the Coldman Sachs foundation, which was updated after Trump announced that he had stopped the “consecutive” tariff plans, is expected to likely 45 % of the recession and GDP growth on an annual basis by 0.5 % for 2025 with 3.5 % basic PCE enlargement.