Trump Uses Questionable Figure for U.S. ‘Plants and Factories’ Lost Since NAFTA

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When President Donald Trump has talked astir the request for higher tariffs connected imports of overseas goods due to the fact that of a diminution successful American manufacturing, helium has often made the assertion that “90,000 plants and factories” successful the U.S. closed aft the North American Free Trade Agreement with Canada and Mexico took effect successful 1994. But that fig is questionable, and experts accidental different factors, specified arsenic automation, had much to bash with the ample diminution successful U.S. manufacturing jobs than trade.

Data from the Census Bureau’s Business Dynamics Statistics database amusement that determination was a alteration of astir 74,000 “manufacturing establishments” successful the U.S. betwixt 1995, the highest twelvemonth for manufacturing aft NAFTA went into effect, and 2022, the astir caller twelvemonth for which information is available. Furthermore, astir one-quarter of the diminution during that astir three-decade play was successful establishments with 4 oregon less employees — truthful it’s unclear however galore of those genuinely number arsenic a manufacturing mill oregon plant. For example, immoderate small-business manufacturers marque products portion moving retired of their ain homes.

About 2% of the diminution was successful establishments with astatine slightest 500 workers. That’s a driblet of 1,346 establishments.

However, implicit the past month, the president — arsenic good arsenic members of his medication — person utilized the 90,000 fig respective times.

On April 7, erstwhile discussing caller tariffs connected imports that helium announced days earlier, Trump said, “We’ve mislaid 90,000 plants and factories. Think of this, 90,000 — you wouldn’t deliberation it’s possible, 90,000 plants and factories since NAFTA. Which was, by the way, the worst commercialized woody ever developed, ever had by immoderate country, anywhere, NAFTA.”

A fewer days earlier, successful an April 3 interview, Vice President JD Vance said, “Since NAFTA, successful the aboriginal ’90s, 90,000 American factories person been closed down. That’s tiny towns that person been blighted.”

And portion speaking with White House reporters connected March 7 astir an summation successful U.S. manufacturing jobs successful February, Trump said, “As you astir apt know, it’s a statistic that everyone talks about, but cipher seems to person done overmuch about. Since the opening of NAFTA, there’s been 90,000 plants and factories closed successful this country.”

When White House Press Secretary Karoline Leavitt made a akin assertion astir mislaid factories aboriginal successful March, the White House told the Washington Post that the fig came from a astir 5-year-old investigation done by the Economic Policy Institute, a left-leaning deliberation tank.

In that August 2020 report, which was astir however Trump hadn’t been palmy astatine reshoring manufacturing jobs during his archetypal statesmanlike term, the EPI said that “the U.S. has suffered a nett nonaccomplishment of much than 91,000 manufacturing plants” betwixt 1997 and 2018, the twelvemonth that the U.S., Canada and Mexico agreed connected a caller commercialized deal, known arsenic the USMCA, which officially replaced their NAFTA woody successful 2020. The EPI report’s superior root was Business Dynamics Statistics information published by the Census Bureau.

But that fig appears to beryllium retired of date. When we tried to corroborate that tally utilizing the BDS online tool, we got a smaller alteration — a driblet of astir 65,000 establishments betwixt 1997 and 2018. Census defines an constitution arsenic “a azygous carnal determination astatine which concern is conducted oregon services oregon concern operations are performed.”

Then, erstwhile we measured from 1995, which was the NAFTA era’s precocious constituent for the fig of U.S. manufacturing establishments, and 2022, the astir caller twelvemonth successful the BDS database, we came up with a diminution of much than 74,000 establishments. (There was a important alteration successful manufacturing establishments successful 2020 and 2021 during the COVID-19 pandemic.)

A statistician for the Census Bureau told america that the BDS bid figures are updated annually with each caller release, which astir apt explains, astatine slightest successful part, wherefore our calculations successful 2025 were antithetic from the EPI’s successful 2020. For its report, the EPI said it besides utilized a antithetic Census dataset to estimation manufacturing losses successful 2017 and 2018.

“The 2022 BDS that was released successful September 2024 contains the astir up-to-date accusation available,” said the Census official, who told america helium besides couldn’t reproduce the EPI’s total.

Moreover, thousands of those mislaid establishments aren’t what galore radical deliberation of arsenic a manufacturing mill oregon works — surely not the ample accumulation facilities that Trump talks astir bringing backmost to the U.S.

The manufacturing sector, according to the North American Industry Classification System, “comprises establishments engaged successful the mechanical, physical, oregon chemic translation of materials, substances, oregon components into caller products.” Those establishments, which usage “power-driven machines and worldly handling equipment” successful the manufacturing process, are often labeled arsenic plants, factories oregon mills.

“However,” the NAICS says, “establishments that alteration materials oregon substances into caller products by manus oregon successful the worker’s location and those engaged successful selling to the wide nationalist products made connected the aforesaid premises from which they are sold, specified arsenic bakeries, candy stores, and customized tailors, whitethorn besides beryllium included successful this sector.”

Another Census authoritative told america that the bureau doesn’t person a breakdown of however galore manufacturing establishments are, oregon were, factories, plants, mills, home-based oregon thing else.

But we bash cognize from the BDS database that establishments with betwixt 1 and 4 workers accounted for astir a 4th of the diminution from 1995 to 2022. Meanwhile, establishments that employed 500 oregon much radical were little than 2% of the decrease.

As of 2022, astir a 3rd of the 268,182 manufacturing establishments successful the U.S. had nary much than 4 employees. At that time, a small much than 1% had astatine slightest 500 employees.

NAFTA’s Role successful Job Losses

As for NAFTA’s role, some critics of escaped commercialized agreements person faulted the aged commercialized pact for a diminution successful U.S. manufacturing jobs. But others disagree that NAFTA is to blame, arsenic Trump has suggested.

“The diminution successful US manufacturing jobs — thing that has been taking spot since 1979 — is much a story of technology (robots, computers, and the like) and changing US user tastes than it is astir trade,” Colin Grabow, subordinate manager astatine the Cato Institute’s Herbert A. Stiefel Center for Trade Policy Studies, wrote successful a March 2024 commentary portion for the libertarian deliberation tank. “We cognize this due to the fact that portion the fig of manufacturing jobs has declined, output has risen.”

Grabow argued that automation and economical improvement person had much to bash with mislaid manufacturing jobs than either Mexico oregon China, which joined the World Trade Organization successful 2001.

Furthermore, successful a 2017 report, the nonpartisan Congressional Research Service said that some proponents and opponents of NAFTA made inaccurate predictions astir the commercialized agreement’s impact.

“In reality, NAFTA did not origin the immense occupation losses feared by the critics oregon the ample economical gains predicted by supporters,” the CRS said, describing NAFTA’s wide effect connected the U.S. system arsenic “relatively modest.”

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