While nominal exports from Wisconsin have improved after Trump, real exports haven’t really recovered — and it may be until the global economy recovers. What does this mean for jobs in Wisconsin?
figure 1: Real “exports” of goods originating in Wisconsin, weighted by U.S. Producer Price Index (1982 all goods (in millions) dollars, nsa (blue, left log scale), and Wisconsin dollar real exports value, 1988 = 100 (red, right) for downscaling) small scale). NBER-defined recession dates from peak to trough shaded in gray; orange dotted line indicates March 2018 when Section 232 and Section 301 measures were announced. resource: Census Bureau Calculations by FRED, Dallas Fed, NBER, and authors.
While Wisconsin’s export growth stagnated during the 2014-15 dollar appreciation, it turned negative after the announcement of Sections 232 and 301, even though the dollar was fairly stable. This shows that Trump’s threatening approach to trade policy has failed — retaliation (and the associated heightened economic policy uncertainty) has not benefited Wisconsin in the export sector.
There are some things to keep in mind when examining these data, as this series does not necessarily represent Wisconsin production.from data description:
This collection does not represent the country of origin of production for U.S. exports. In some cases, sizable exports of manufactured goods have been attributed to states with little known manufacturing capacity. One reason is that items produced by out-of-state suppliers can be shipped from in-state distribution centers. Another factor is the delivery of finished goods from in-state warehouses and other distribution centers arranged by out-of-state exporters. In both cases, exports of manufactured goods from non-industrial countries are amplified in the OM series.
Employment in durable manufacturing has languished, in part as a result. Despite a booming domestic economy, durable manufacturing employment on the eve of the pandemic was the same as when Mr. Trump announced his intention to impose protectionist measures under Sections 232 and 301.
figure 2: Actual “exports” of goods originating in Wisconsin, by US PPI (all goods in 1982 in millions of dollars), nsa (blue, left log scale) and Wisconsin durable goods manufacturing employment , 000s, sa (red, right log scale) shrinks. NBER-defined recession dates are shaded from peak to trough in gray; dashed orange line indicates March 2018 when Sections 232 and 301 measures were announced. resource: Census BureauBLS, by FRED, NBER, and the authors’ calculations.
Manufacturing employment will struggle to grow significantly without a full recovery in export trends (although total manufacturing employment has surpassed pre-pandemic levels.)
