President Donald Trump‘s aggressive push to protect domestic industry through tariffs is backfiring on the very sector it aims to defend, with the U.S. manufacturing economy shrinking for the sixth month in a row and businesses citing soaring costs, job cuts and planning chaos.
The Institute for Supply Management’s (ISM) Manufacturing Purchasing Managers Index (PMI) for August stood at 48.7%, just above July’s 48% but still below the key 50% level that signals expansion. Economists had forecast a modest rebound to 49%.
The only bright spot was a slight uptick in new orders. However, all other major subindices deteriorated.
Production and employment both declined, supplier deliveries slowed, and inventories of raw materials continued to shrink. Input prices increased, while both imports and exports contracted, reinforcing the picture of a sector under sustained pressure.
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Tariffs Slam US Manufacturing, Push Prices Higher
Business leaders surveyed by ISM drew a direct link between the sector’s weakness and current tariff …