Each new administration brings its own laws, regulations, trade agreements and economic policies to office, each causing subsequent market reactions and fluctuations in every aspect of the economy. In manufacturing, international trade policy, private investment, unemployment rates and fiscal stimulus policies all play an important role in market variations and real positive or negative growth. Following the election of Donald Trump in November, markets reacted immediately and, though the effects of the new administration’s policies have yet to be seen, both positive and negative forecasts exist in manufacturing, resulting from key economic indicators seen up to this point.
With domestic steel production currently struggling to compete with production abroad, most notably from China, experts predict the new administration’s strong emphasis on American industry and against international trade deals will give U.S. metals markets much-needed reinforcement. Critics argue that isolationist policies will discourage foreign investment, pushing businesses away from the U.S. as a trade partner, and make international sales more difficult.
Trump’s cabinet picks have caused concern for some and created optimism for others. Regardless, his selection of advisors seem to align with similar attitudes; imposing strong tariffs on goods from countries deemed to have inequitable economic policies, cutting or condensing regulations seen to pose obstacles to private spending, and reducing government influence on free-trade. Some believe the selected business leaders in government positions will advocate for domestic production. Others contend that Trump has selected individuals that go too far, and undiplomatic trade policies and excessive regulation cutting could mean trouble at home and abroad.
Trump’s proposed fiscal stimulus plan has many businesses seeing a bright horizon, fueling an uptick in stock markets. As congress is unlikely to support a spending bill, the stimulus is expected to come from private spending, translating to higher production, more jobs and a higher GDP. However, with unemployment rates at all-time lows, economists indicate that a stimulus plan may serve only to drive up inflation and fail to increase overall GDP.
R&M is optimistic about the future of manufacturing and continues to meet the challenges our customers face with dedication to innovation and customer service. While the future growth of the overall economy and domestic manufacturing interests are never assured, the R&M team knows hard work, loyalty to our customers and a drive to produce the best possible products will continue to provide positive results.