Proposed U.S. Tariffs Could Increase Labor Challenges

The U.S. already faces a critical labor shortage, with tariffs threatening to reshape and reshore manufacturing.

U.S. Trade Tariffs Could Increase Workforce issues
U.S. Trade Tariffs will likely increase workforce issues that already stand at more than 450,000 unfilled manufacturing jobs.
Marie Hickman via Getty Images

OEM Magazine rarely discusses politics but we will obviously cover policies and potential policies that will impact packaging and processing manufacturing.

In the coming weeks, the landscape of American manufacturing—including the packaging and processing sector—will confront numerous uncertainties, driven by a complex interplay of trade policies and labor dynamics. At the core of this shift is President-elect Donald Trump's ambitious plan to impose sweeping tariffs on imports, a strategy aimed at revitalizing domestic production. However, this approach encounters a significant challenge well-known to those in packaging and processing: a shortage of skilled labor to meet what could be a surge in factory jobs.

Trump's proposed tariffs, including a 25% duty on imports from Canada and Mexico and a 60% increase on Chinese products, aim to make foreign goods more expensive, thus encouraging companies to move production back to the U.S. An overlooked aspect of this vision is complicated by the reality that many manufacturing positions remain unfilled. Recent data shows that around 450,000 manufacturing jobs are unfilled, underscoring the ongoing labor gap.

The National Association of Manufacturers (NAM) emphasizes that 60% of its members consider hiring and retaining employees their top concern, even before the proposed tariffs. This issue is set to escalate, with forecasts predicting a need for an additional 3.8 million workers in the coming years. Factors such as an aging workforce, increased industrial demand, and new government-backed semiconductors and green energy initiatives contribute to this impending need. Additionally, with reshoring and the potential effects of Trump's immigration policies—which target the deportation of undocumented workers and restrictions on legal immigration—these measures could further diminish the available workforce, worsening the challenges packaging and processing manufacturers encounter.