The largest US nail manufacturer is on the brink of extinction after protectionist tariff war takes longer than expected. Trump in his latest move tried to implement the America first policy by putting tariffs on the steel imported. The idea was to boost the production of steel in the local industry instead of getting it imported.
The Mid-Continent Nail Plant in Poplar Bluff laid off around 60 employees ina recent week. The company blamed the downsizing on the 25% tariff on imported steel. The company had to increase the price of its nails after an import tariff was implemented. The increment in prices made the company suffer a 50% decline in sales.
Mid-Continent Nail is on Brink of Extinction after protectionist tariffs were implemented on the imported steel. The company saw a decline in sales after they increased the price of nails due to higher production cost.
The company officials are thinking to relocate the company to Mexico. They feel that company will shut down very soon if the commerce department does not exclude them from import tariffs. The tariffs apply to raw materials at the moment, thus sending back finished products in the US will not cost much.
The company spokesperson Glassman said that moving to Mexico is not something they want. They want to create more jobs in Poplar Bluff, Missouri. He further added that the company had created more jobs since 2013.
US Chamber of Commerce has calculated that around 2.6 million US jobs are at risk. The government needs to find a middle way to secure a win-win situation for all the contenders. The area where the plant of Mid-Continent Nail is present has voted 80% for the President Trump’s election. It has become less clear if people of the town are supporting the president.
Is it Just a beginning of Job Reduction?
The question is real and poses a threat to the American Economy. The tariffs are also causing some warped relationship with EU and China. Trump has shown aggressive policies for exercising the America First policy. All the unequal treaties are being repealed. Trump has a history of changing relations with respect to the situation, for example, North Korea is now enjoying good relations with America.
Let’s see if these tariffs take another turn or the general public faces job reduction.