Will Steel Tariffs Revitalize the U.S. Steel Industry?

The Trump administration made waves earlier this year when it decided to invoke a 25% tariff on steel imports. The goal, according to the administration, is to protect American steel workers from unfair trade practices, but critics immediately blasted the decision, saying it would hurt consumers instead of help.

On the surface, the tariffs will make domestic steel relatively cheaper to buy than foreign, imported steel. The tariffs will raise the price of imported steel so that it is higher than steel made in the U.S. This will help increase sales for American steel producers.

As American steel sales rise, there will be a domino effect in which local economies that depend on steel see more prosperity. This is being seen now as U.S. Steel announced plans to reopen a blast furnace in Illinois, which will restore 500 jobs. Nucor Corp. announced late last fall plans to open a micro mill in Missouri that will create 255 jobs.

These job increases by themselves may be small, but when added together, they could collectively provide thousands of jobs in hard-hit areas that have depended on steel for generations.

In the short term, it’s likely that steel producers will see an increase in business. But the larger macroeconomic effects will have to be seen as we go through the second half of 2018 and into 2019, when the effects of longer-term plans enacted this year from American steel corporations will be shown.

Needless to say, the Trump administration’s steel tariffs have been a big hit in steel country, and have encouraged thousands of workers and their families that better times may be right around the corner should the tariffs prove to be a lasting success.

And if steel country benefits, the economic benefit could soon be felt in other areas as a rising tide lifts all boats.

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