{"id":1825,"date":"2018-03-22T15:19:23","date_gmt":"2018-03-22T15:19:23","guid":{"rendered":"https:\/\/www.certitrek.com\/nlpa\/?p=1825"},"modified":"2021-07-28T06:51:30","modified_gmt":"2021-07-28T10:51:30","slug":"trumps-tariffs-hit-metals-then-china-could-the-service-industry-be-next","status":"publish","type":"post","link":"https:\/\/www.certitrek.com\/nlpa\/blog\/trumps-tariffs-hit-metals-then-china-could-the-service-industry-be-next\/","title":{"rendered":"Trump\u2019s Tariffs Hit Metals, Then China. Could The Service Industry Be Next?"},"content":{"rendered":"

Earlier this month, US President Donald Trump announced 25% tariffs on steel imports and 10% tariffs on aluminum imports. \u00a0According to Yahoo! Finance, he plans to \u201cimpose tariffs on $50 billion worth of Chinese imports.\u201d<\/p>\n

With Trump, one gets the sense that, if he gets on a roll, he\u2019s going to stay on a roll. \u00a0So, what\u2019s next?<\/p>\n

An\u00a0article on The Balance dances around this question. \u00a0It implies that countries like Japan and Germany could be Trump\u2019s next targets for protectionist measures.<\/p>\n

But the article, whose statistics are based around Census figures, wisely includes the caveat that \u201cthe Census provides trade data by country for goods only, not services.\u201d<\/p>\n

For nearly 20 years, the US economy has seen its service industry steadily offshored. \u00a0IT support, customer service \u2013 heck, even procurement \u2013 have all been offshored. \u00a0Not necessarily because the workers in the developing countries were good, but largely because they were cheap.<\/p>\n

But what if Trump decided to reverse this trend with tariffs?<\/p>\n

Suddenly, the call centers wouldn\u2019t be so inexpensive. \u00a0And, in that case, would US-based companies reshore the outsourced functions? \u00a0Or, perhaps a better question,\u00a0could<\/em>\u00a0US-companies reshore the outsourced functions? \u00a0Is there enough IT support, customer service and procurement capacity left after so much has been offshored?<\/p>\n

It wouldn\u2019t surprise me if we were forced to find out. \u00a0Trump likes winning, has won some trade-related initiatives, and is likely to focus his efforts on areas where he can continue to win (unlike repealing and replacing Obamacare, which we haven\u2019t heard much about since the US Congress has failed to pass any related legislation).<\/p>\n

Recommended Reading<\/b><\/p>\n