In what should come as no surprise to anyone with a basic understanding of how supply chains work, Trump’s ever-escalating trade war with China is having a ‘catastrophic’ effect on the American retail industry.
According to a recent article from The New York Times, back in 2018, well before any of this tariff craziness began, nearly 6,000 stores were shuttered in the US, and another 7,000 stores were slated to close by the end of 2019. Now, however, with some of Trump’s tariffs enacted, and more on the way, the number of store closures estimated for this year has jumped to 12,000 – a figure the Times calls “catastrophic.”
What’s more, the staggering loss of retail jobs – we’re at 50,000 and counting since January – is in no way going to be offset by a return of manufacturing jobs, “because labor costs are much higher here and there is little capacity for new production.”
Instead, as Quartz reports, the corporations who contract in China (many of whom are American) are now simply moving production to other, cheaper places. “Mexico and Vietnam have benefited the most, followed by South Korea and Taiwan.”
Quartz goes on to say that even if a “breakthrough” in the US-China negotiations occurs, it won’t “be enough to deter the… changes afoot,” as the full-on “supply chain rejiggering” happening because of Trump’s tarffis is already too far along.