The US jobs report for May 2019 was pretty grim.
The US economy added only 75,000 new jobs for the month. The consensus estimate from economists was that the economy would add 180,000 new jobs. 180,000 new jobs is roughly the number of new jobs that need to be added to keep up with the number of new people entering the workforce every month with a population our size.
This was the second time in the last four months that the number of jobs added to the economy was less than 100,000. Trump doesn’t understand this, but much of this is a result of his tariffs.
Tariffs are taxes on Americans. American importers and American consumes pay the tariffs, not the country of origin.
Tariffs cause businesses to lose customers because they have to raise their prices to cover the tariffs, and as a result of losing customers, they end up laying off employees or not hiring for jobs they would have otherwise.
The tariffs on goods coming from China will cost the average American family between $800 and $900 per year according to a federal estimate. Now that Trump is considering adding tariffs on Mexican goods, the cost to Americans will go up even more. The biggest imports from Mexico are avocados, beer, tequila, automobiles and car parts. All of those will be more expensive.
Automakers are saying the cost of a car will rise by $1300, minimum. That’s at the 5% tariff rate. Trump threatened to raise tariffs on Mexican goods to 25%, which would severely damage the automobile industry.