A new survey released by the National Association for Business Economics (NABE) shows that hiring by U.S. companies has fallen sharply in recent months. According to an NABE summary of the survey, only 20 percent of companies surveyed said their firms have made additional hires in the last three months. That is down from one in three in July and the weakest number since 2012.
Wage increases have also appeared to slow in the third quarter. One in three companies surveyed for the latest report said their companies increased pay over the last three months. A year ago, a majority of the companies surveyed reported increasing pay for their workers.
The declines have been traced to several factors. One factor has been a slower growth in sales. Roughly 39 percent of the firms surveyed are reporting higher sales in the past three months, compared to 61 percent a year ago. About 38 percent said that they are expecting sales to increase in the three months ahead, compared to 61 percent a year ago.
Another factor has been increased cost for materials due to the trade wars the Trump Administration is currently engaged in with several major economies. According to the survey, 35 percent of respondents said tariffs on aluminum, steel and most Chinese goods have hurt their companies. That compares with 7 percent who said the tariffs have had a positive influence.
The trade war with China appears to be having the biggest effect. The two sides are currently maintaining tariffs on thousands of each other’s products. Earlier this month, it was announced that the U.S. and China would be agreeing to a “phase one” trade deal, with Beijing buying tens of millions of dollars of agricultural products from the U.S. as part of the agreement.
The Trump Administration is also escalating its trade wars with other countries. The World Trade Organization recently agreed to allow the U.S. to levy $7.5 billion in tariffs against the European Union over illegal subsidies provided to Airbus. Since then, the U.S. has imposed tariffs on a range of European goods.