President Trump says he will be the greatest jobs producer God ever created. “I’m going to work very hard on that. We need certain amounts of other things, including a little bit of luck, but I think we’re going to do a real job,” he said recently.
While his critics laughed and economists urged caution, the truth is American manufacturing is already showing signs of confidence and optimism about a Trump presidency.
U.S. CEO’s are rewarding the incoming administration with a flurry of announcements promising new jobs, bigger inventories and a reduction of operations moving to Mexico and abroad. Some of those announcements have come under the pressure of tweets by Trump directed at a handful of companies, but most are a nod of confidence to his promises of tax and regulatory reforms.
They are also a sign of approval of his blunt tough talk on China’s practice of currency undervaluation and the deliberate dumping of its products into the U.S. market at below the cost of production.
Those two practices, along with high-tech automation, have cost blue-collar workers their middle-class job opportunities and economic stability for a generation. It’s a situation that pushed many of those same workers to vote for him.
“The election results can be really important to our business,” said Bryan Iams, vice president of corporate communications for PPG Industries in Pittsburgh. “As we look at it through some early discussions that we have had with the members of the transition team for” Trump, he said, “we are hearing that there is going to be a sharp focus on some key areas that are really important to companies like ours.”
The Bureau of Labor Statistics data show the United States lost 286,000 manufacturing jobs during the time President Barack Obama was in office. Employment gains were in lower-paying retail and food services industries, where 3,238,800 jobs were created.
Manufacturing jobs average hourly earnings is just over $26 an hour according to BLS. Food service jobs are half of that at $13.60 an hour with retail jobs slightly higher at $18 an hour.
The loss of those manufacturing jobs due to automation and bad trade deals and the destruction of the coal industry by regulations have soured many voters in the Rust Belt on the Democratic Party and their candidates. Trump’s rhetoric and “Make America Great Again” offered them a message of hope and tangible benefits that Hillary Clinton failed to deliver.
Iams said he has also been meeting with members of congress about the Trump agenda. “All of the conversations have been centered on timetables for a comprehensive tax reform package, infrastructure spending, and regulatory reforms,” he said.
Iams said infrastructure spending means more of his high-end coatings will be used in those projects on bridges, roads, buildings, ships, and so forth. “And lower tax rates gives us the ability to repatriate cash that we have that has been currently stuck in some other parts of the world. Which means we can reinvest here in U.S. operations where we do all of our research, development and manufacturing,” he said.
Iams would not put a number on hiring or expansion plans, said: “We are feeling confident and we are optimistic. And that optimism coupled with those public policy issues will make us grow and produce more in the US.”
Founded in 1883, PPG is the world’s largest manufacturer of paints and coatings. Its employees are not only skilled laborers, but scientists, chemists, engineers and high-tech workers who manufacture paint, coatings and materials worldwide, with operations in more than 70 countries and more than 46,000 employees.
More than 18,000 PPG employees in the U.S. work at 35 manufacturing facilities in places like Springdale Pennsylvania, Strongsville Ohio, Oak Creek, Wisconsin, as well as plants in Michigan, Texas, South Carolina among others.
Other company chiefs are offering optimism as well. Last month, U.S. Steel CEO Mario Longhi predicted 10,000 steelworkers could be back to work under the business-friendly policies of a Trump administration.
In the week that Trump won the election, the Bloomberg Americas Iron/Steel Index, which tracks the value of steelmakers in North and South America, reported an 18 percentage jump for the industry.
As if on cue, U.S. Steel announced last week it plans to reopen an idled plant in Keewatin, Minnesota, a move that will bring approximately 202 furloughed employees, in December the steel company also announced plans to reopen a shuttered mill and blast furnace plant in Granite City, Illinois, restoring 220 jobs that have been idled since 2015.
And in McKeesport, Pennsylvania, Jason Morris, president of the family-owned company Dura-Bond, said the shift in the mood of the country toward buying American and supporting American manufacturers had prompted him to buy the manufacturing assets of a shuttered U.S. Steel plant.
Morris will lease the steel company’s building and rail line and begin tubular steelmaking sometime this year.
Over 260 employees lost their jobs in June of last year after U.S. Steel said unfairly-imported tubular steel products were hurting its business.
Steelton, Pennsylvania’s Dura-Bond bought a Bethlehem Steel pipe mill in 2003 and the plant has been at 100 percent capacity for over a year.
The oil and gas industry is a major part of Dura-Bond’s tubular steel pipe business, and energy will be a part of the reviving American workforce under a Trump administration. Trump indicated in several speeches last year that he was going to free up the regulations that were hurting the coal, gas and oil industries, something that causing Consol Energy COO Tim Dugan some optimism in an industry hit hard by regulations.
“We are very encouraged by the prospect of a regulatory and political climate that recognizes the importance of our domestic energy resources,” he said.
Dugan added that challenges remain with regard to the pipeline infrastructure necessary to effectively bring energy to markets, “But we anticipate a streamlined regulatory environment that will help encourage further buildout of this infrastructure and growth across the energy space,” he said.
Consol energy employs over 2,300 people in Pennsylvania, West Virginia, Ohio and Virginia. For the past few years the company has undergone a transformation from a legacy coal producer to a natural gas company.
Trump has also created some unease among American CEOs as he has moved the needle with companies by using social media to declare where they should build their cars, make their air-conditioners or create new jobs with Tweets.
He has taken aim at Ford, General Motors, Carrier, industrial parts maker Rexnord and aerospace companies Boeing and Lockheed Martin, generating more jobs and lower costs in the process.
But Trump’s approach is not unprecedented. Other presidents, such as Teddy Roosevelt, Harry Truman and Jack Kennedy, all used sharp elbows, salty language and the press to issue edicts.
Roosevelt certainly did when he put big business on notice during the original progressive era. Truman did when he squashed a looming railroad strike by issuing an executive order putting American railroads under the control of the U.S. Army, and Kennedy did as well when he publically shamed steel executives for raising prices.
It is unclear if Trump’s unorthodox methods will continue to be successful. But what is clear in the Midwest, many CEO’s are optimistic that he will have major positive impact on their business plans.
