Trump says free trade killed American auto jobs. That’s not the whole story

Tariffs aren’t going to reverse the loss of auto jobs in the Midwest during the last 30 years. Automation, and a change in American car buyers’ preferences, cost more jobs than bad trade deals.

Much of President Donald Trump’s tariff rhetoric has been about restoring factory jobs — particularly auto jobs — that he says had been destroyed by bad trade deals such as the North American Free Trade Agreement. “American steelworkers, auto workers, farmers and skilled craftsmen … they really suffered gravely,” Trump said during his April 2 rollout of new tariffs. “Foreign cheaters have ransacked our factories, and foreign scavengers have torn apart our once beautiful American dream.” Trump promises that his 25% tariffs on all imported cars will raise costs enough to bring a flood of new auto plant construction, and thus auto jobs, back to US shores. But the loss of auto jobs in the US, especially across the upper Midwest, is a complex story beyond trade deals and shifting production to low-wage countries. There was also the fact that American car buyers abandoned the three Detroit automakers for foreign competitors following years of questionable quality and value. And most importantly, the introduction of automation, which drastically reduced the hours needed to assemble a car. “What you see is that the real story in the auto sector is automation,” said Jason Miller, a business professor at Michigan State University and an auto industry expert. One of the reasons the production shift to Mexico gets so much attention from those angry about assembly plants and auto parts factories closing, Miller says, is due to timing. The introduction of more robots, and the resulting job loss, “was especially severe during the exact time period that trade liberalization took place.” And the situation is not nearly as dire as Trump makes it out to be. In fact, there are more workers building cars in US assembly plants today than when NAFTA took effect in 1994, according to the US Labor Department data. They also built roughly twice as many cars as Mexico and Canada combined last year, according to S&P Global Mobility.