Listen to this articleA large number of companies in industries have experienced a massive hit from increasing trade war of Donald Trump. They have shown hiring slowed sharply in May and hesitated to bring on new employees. On Friday, the labor Department reported that a significant pullback from 224 thousand jobs added in April and the U.S economy added 75 thousand jobs last month. The slow growth was the major red light yet that the economy is under strain. The unemployment rate remained at a five-decade low of 3.6%, but wage growth disappointed.
The research director of Hiring Lab for Indeed.com, Martha Gimbel said, “The slowdown is really coming from the sectors that are most susceptible to trade tensions like manufacturing, construction, mining and logging. That does make me worried”. The hiring fizzle comes as Trump has faced off in trade negotiations with some of the country’s largest trading partners. On Friday, the president announced that he is suspending a plan to put a 5% tariff on Mexican exports after his administration struck a deal with Mexico to stem illegal migration. Trump is still bargaining with the Chinese over a trade deal that would lift big tariffs each country has imposed on the other. He is set to meet with China’s President Xi Jinping at the end of the month to finalize those negotiations.
The ISM Manufacturing Index fell to the lowest level of Trump’s presidency earlier this week and it is another warning sign regarding the strength of the factory sector. The stock market rallied, with the Dow Jones industrial average jumping more than 263 points, or 1%, in spite of the poor jobs report. The largest publicly traded companies of America have recorded its best weekly performance so far this year. The Wall Street report according to the CME FedWatch Tool has indicated that more than a 75% probability that the Fed will cut rates by the end of next month.
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