ICYMI: “Trump’s tariffs are saving the American steel industry”

Press Releases

TLDR

This press relase references an executive order imposing 25% steel tariffs will likely have limited benefits for the steel industry while causing broader economic harm. Trump’s previous steel tariffs in 2018 created only about 1,000 steel jobs while causing 7,000-10,000 job losses in steel-dependent industries. The tariffs face significant public opposition (61% disapproval) and unanimous skepticism from economic experts. While the steel industry may see short-term benefits from reduced competition, these come at significant costs to construction, automotive, and other sectors that rely on steel inputs.

This White House press release and noted op-ed by Philip K. Bell, president of the Steel Manufacturers Association, claims that President Trump’s 25% tariffs on steel imports will “reinvigorate” the American steel industry. However, economic data and research suggest a more complex reality.

Bell claims the tariffs will revitalize domestic steel production, but historical evidence from Trump’s first-term tariffs shows limited benefits for the steel industry while causing broader economic harm:

  1. Limited Job Creation: Trump’s 2018 steel tariffs only added about 1,000 new jobs in the steel manufacturing sector. This minimal gain came at a significant cost to the broader economy.

  2. Disproportionate Job Losses: Steel-consuming jobs outnumber steel-producing jobs by a ratio of 80 to 1. The tariffs from Trump’s first term adversely affected employment in the very manufacturing industries they were intended to protect.

  3. Net Negative Impact: Studies found that the small positive effect from import protection was offset by larger negative effects from rising input costs and retaliatory tariffs. The previous implementation resulted in 7,000-10,000 job losses in small and medium enterprises that relied on steel.

The tariffs have far-reaching negative consequences for the broader economy:

  1. Higher Costs Across Industries: The tariffs are expected to elevate expenses for industries that rely heavily on steel, including construction, automotive, transportation, machinery, energy, utilities, and consumer goods manufacturing.

  2. Project Cancellations: Many construction projects were canceled during the previous tariff implementation because steel price increases made them economically unfeasible, resulting in lost construction jobs.

  3. Market Disruption: The announcement of these tariffs triggered immediate turmoil in the U.S. stock market, and their implementation led to the S&P 500 entering correction territory.

Despite the Steel Manufacturers Association’s support, the tariffs face significant opposition:

  1. Broad Public Disapproval: 61% of Americans disapprove of the way Trump is handling tariffs, including 72% of young adults.

  2. Opposition from Key Constituencies: 59% of Americans without college degrees and 62% of those making less than $50,000 also registered their disapproval—these are key demographics in Trump’s voter base.

  3. Economic Understanding: 54% of Americans believe that it’s mostly American companies and consumers who bear the cost of tariffs, not foreign countries and companies.

The economic expert community is overwhelmingly skeptical of the tariffs’ benefits:

  1. Unanimous Expert Opinion: A Chicago Booth survey of 43 economic experts revealed that 0 percent thought a US tariff on steel and aluminum would improve Americans’ welfare.

  2. Academic Research: Multiple academic and governmental studies find the tariffs have raised prices and reduced output and employment, producing a net negative economic impact.

While the steel industry may see some short-term benefits from reduced competition, the evidence suggests that these gains come at a significant cost to the broader American economy and workforce. The claim that these tariffs will “save” or “reinvigorate” the American steel industry overlooks the substantial economic trade-offs and collateral damage to other sectors of the economy.

The American steel industry will be “reinvigorated” by President Donald J. Trump’s tariffs on steel imports, writes Steel Manufacturers Association President Philip K. Bell in today’s Pittsburgh Post-Gazette — describing how President Trump’s action to close loopholes and exemptions will strengthen the critical industry.

“The American steel industry, in other words, is going in reverse, primarily because of increasing imports from exempt countries and product exclusions. With global overcapacity soaring, foreign producers everywhere will take advantage of any gaps in America’s tariffs to find an outlet for their excess steel in the U.S. market.

The harmful impact of a ton of imported steel sold at the domestic industry’s expense does not depend on whether it comes from an ‘ally’ or ‘adversary’ country.

A stable supply of domestically produced steel is more important than ever to America’s national, economic and energy security. In the face of the considerable pressure likely to come to exempt certain countries and weaken the tariffs, the president has stayed strong and continued to put America first on steel trade.”

Read the full op-ed here.

This is the text:

Philip K. Bell: Trump’s tariffs are saving the American steel industry Mar. 18th, 2025

One of President Donald Trump’s most impactful moves during his first term was applying 25% tariffs on nearly all steel imports. As a result, the American steel industry saw a revival.

On March 12th, he reinvigorated that action by closing the exemptions and loopholes that had weakened it over time. He was right to do so.

A suffering industry The American steel industry was cutting production, laying off workers, and idling facilities because of unfair trade. Domestic steel producers filed a series of trade cases seeking relief from unfairly traded imports.

Countries selling this dumped or subsidized steel in our market included China, Korea, Taiwan, Australia, Brazil, Mexico, Canada, India, Vietnam, Germany, the Netherlands, Russia, Japan, Belgium, and France.

Domestic producers must file these cases to compete successfully, but they have become a costly game of Whac-a-Mole. One successful trade case is soon followed by import surges of new products or products from new countries.

The president’s comprehensive response leveled the playing field. The industry’s production and percentage of what could be produced (what’s called its capacity utilization) improved as harmful import volumes fell. Steel companies invested more than $20 billion to expand and improve their capabilities.

Most importantly, they were able to continue providing reliable, high-wage jobs to the hard-working Americans and the communities that rely on them. And the American economy continued to thrive.

Weakened tariffs

Over time, however, the impact of the tariffs was dramatically weakened. Negotiations and agreements led to complete exemptions for Australia, Canada, and Mexico, and partial exemptions in the form of tariff-rate quotas for Japan, the European Union, and the United Kingdom.

They led to quotas for Argentina, Brazil, and Korea that are no longer effective given changing market conditions. The new agreements allowed millions of tons’ worth of product exclusions, including for products that domestic producers are ready, willing and able to supply.

As a result of these modifications, the tariffs have applied to only a small share of total U.S. steel imports for the last several years. Their beneficial impact on the American industry has been significantly eroded.

Today, market conditions are once again deteriorating. The intergovernmental Organisation for Economic Co-operation and Development projects that global overcapacity will reach 644 million metric tons by 2025, an increase of nearly 100 million metric tons over 2023.

China’s steel exports in 2024 reached near-record highs of more than 110 million metric tons, as its domestic demand has collapsed. Prices around the world are falling.

This has driven higher U.S. imports from the countries that were exempted from the steel tariffs, even as U.S. demand has softened. U.S. finished steel imports were more than 630,000 metric tons higher in 2024 than in 2023, with Canada, Mexico, South Korea, and Brazil — all exempt from the tariffs — the four largest sources.

The domestic industry’s shipments, in contrast, declined by 3.6%. The American steel industry’s capacity utilization rate has fallen to 75%, well below the 80% minimum target set by the Commerce Department in 2018, and nearly three percentage points lower than it was this time a year ago.

A stable supply

The American steel industry, in other words, is going in reverse, primarily because of increasing imports from exempt countries and product exclusions. With global overcapacity soaring, foreign producers everywhere will take advantage of any gaps in America’s tariffs to find an outlet for their excess steel in the U.S. market.

The harmful impact of a ton of imported steel sold at the domestic industry’s expense does not depend on whether it comes from an “ally” or “adversary” country.

A stable supply of domestically produced steel is more important than ever to America’s national, economic and energy security. In the face of the considerable pressure likely to come to exempt certain countries and weaken the tariffs, the president has stayed strong and continued to put America first on steel trade.

Philip K. Bell is the president of the Steel Manufacturers Association.

First Published: March 18, 2025, 4:30 a.m.