Episode #1: Adapt and Thrive - Strategies for Manufacturing Success under Trump 2.0
In the first episode of U.S. Manufacturing Today, host Matt Horine, Head of Reindustrialization at Veryable, discusses the latest changes and developments in the U.S. manufacturing landscape under the second Trump administration. Topics include the impacts of new tariffs, trade policies, the crackdown on illegal immigration, and how these shifts affect manufacturing and distribution sectors. Matt provides insights into how businesses can adapt and thrive in this volatile environment, emphasizes the advantage of using a flexible labor pool, and introduces Veryable's solutions for mitigating risks and seizing new opportunities. The episode also features a detailed breakdown of recent policy changes, retaliatory measures from trade partners, and presents strategic advice for manufacturers facing the current and upcoming challenges.
Links
Timestamps
- 00:00 Introduction to U.S. Manufacturing
- 01:26 Understanding the Impact of Immigration
- 02:15 Tariffs and Trade Policies Under Trump 2.0
- 06:48 Future Trade Developments and Predictions
- 10:28 Adapting Your Business to New Realities
- 12:42 Leveraging Variable for Workforce Flexibility
- 17:46 Conclusion and Resources
Episode Transcript
Welcome to the first episode of U.S. Manufacturing Today. I'm your host, Matt Horine, head of reindustrialization at Veryable. In this podcast, you will hear the latest shifts in the U. S. manufacturing landscape, what is changing, what is happening, and how it impacts you today.
In this first episode, we want to help paint the picture of what is going on. Tariffs, trade, supply chain, volatility, and policy related issues are all on the table. Things are moving fast and it seems like literally every hour there's a new development. It can be hard to keep up, especially if you're in operations and you're busy in the daily fight and getting orders out the door.
As a company of former operations leaders, we understand this better than anyone. And it's why we intend to help you cut through the noise that you're seeing across the constructed narratives, misleading headlines, and provide clarity around this once in a generation shift in manufacturing and national policy.
That's why we intend to serve as your one stop shop for information and insights about the U. S. manufacturing and distribution sectors, especially as it relates to changes taking place under Trump 2.0. Trump's first seven weeks have been a whirlwind to say the least and you've probably been hearing lots of conflicting things as far as how the administration's illegal immigration crackdown and how new tariffs will impact the manufacturing and distribution sectors.
We're gonna clear things up, give you the rundown on what's happened so far, what's on the horizon, and how you can adapt proactively and position your business to thrive in the coming months. The first subject that probably deserves highlighting is immigration. One of Trump's first and most widely anticipated moves, of course, was his crackdown on illegal migration.
And even though the numbers haven't been as high as many were expecting, it is an issue that has historically impacted manufacturing, as many companies utilize this illegal source of labor, but now the entire industry is under a microscope and will continue to be. Even if your business is not reliant on illegal labor, you shouldn't overlook this, as chances are some of your competitors are using it, and this presents both challenges and opportunities.
If one of your competitors gets raided by ICE and suddenly loses a big portion of their workforce, this could present a massive opportunity to snatch up some more market share, but only if you're adequately prepared and can react fast. We'll get into how you can do that later in this episode. Now, let's recap some of Trump's actions with regards to tariffs.
Trump's first announcement on tariffs came less than two weeks into his second term, and on February 1st He signed three executive orders under the International Emergency Powers Act Which is also known as IEEPA to add new tariffs on goods from Mexico, Canada, and China specifically the administration stated plans to implement a 25 percent tariff on imports from Canada and Mexico and a 10 percent tariff on imports from China. Energy resources from Canada, on the other hand, will have a lower 10 percent tariff.
Shortly after the announcement, however, Trump agreed to pause the tariffs after the leaders of both Canada and Mexico promised to deploy additional resources to their countries respective borders with the United States in order to help curb the flow of fentanyl and illegal migration. China, however, announced retaliatory tariffs shortly after, and on February 10th, implemented a 15 percent border tax on U.S. coal and liquefied natural gas imports, alongside a 10 percent tariff on American crude oil, agricultural machinery, and large engine vehicles. Also on February 10th, Trump announced his plans to restore the Section 232 tariffs and impose 25 percent duties on imports of steel and steel derivatives, as well as aluminum and aluminum derivatives.
These actually went into effect this morning on March 12th. The original Section 232 tariffs were implemented in 2018, however, aluminum then only had a 10 percent tariff. Additionally, there were many exclusions that allowed companies to avoid these tariffs. While existing exclusions will still be in place under their expiration date, the Trump administration has announced that no new exclusions will be granted, meaning those dependent on steel and aluminum imports truly have nowhere to hide.
A few days later, on February 13th, Trump also announced his plans to implement reciprocal tariffs. Under current trade rules, the U. S. typically charges the same tariff for specific goods regardless of the country of origin, although subject to free trade agreements and trade preference programs. Under the Reciprocal Trade Memorandum, however, the United States will take a different approach by charging different tariffs based on the country of origin.
As detailed in the memorandum, the reason for this latest decision is that while America has one of the most open economies in the world, its trading partners have often kept their markets closed to U. S. exports. This, in turn, has contributed to America's massive trade deficit, which has persisted for almost 50 straight years and exceeded 1 trillion in 2024.
We saw that number surge in January of this year as well due to panic buying with these impending tariffs. For example, the EU can export all the shellfish it wants to the United States, but the EU bans shellfish exports from 48 U. S. states, despite committing in 2020 to expedite approvals for shellfish exports.
In 2023, the US imported $274 million in shellfish from the eu, but exported only 38 million. As far as timing goes for these reciprocal tariffs, the administration says that these could go into effect as soon as April 2nd, which is the same day the exemption for USMCA goods from Canada and Mexico will expire.
Jumping ahead a few weeks, on February 27th, Trump announced that the tariffs on Canada and Mexico would go into effect on March 4th and that he would implement an additional 10 percent tariff on China. While all these tariffs were implemented on March 4th, just a day later, on March 5th, after a phone call with leaders from the Big Three, Trump announced a one month exemption for automakers, and the next day, on March 6th, announced that he would be exempting all products from Canada and Mexico that fall under USMCA until April 2nd.
A lot of volatility in the trading there. Despite this exemption, on March 4th, Canada implemented a series of retaliatory tariffs on 21 billion US dollars worth of American goods, like orange juice, peanut butter, coffee, appliances, footwear, cosmetics, motorcycles, and certain pulp and paper products.
Additionally, Ontario Premier Doug Ford implemented a 25 percent tax on electricity exports to the United States. In response, the administration announced yesterday, on March 11th, that he would double the steel and aluminum tariffs on Canada, bringing them to 50%. However, just a few hours later, retracted this statement due to Canada's decision to roll back the energy export tax. Now, on Thursday, Ontario Premier Doug Ford and U. S. Commerce Secretary Howard Lettnick agreed to meet in D. C. to discuss a renewed USMCA trade deal. In China's case, almost immediately after Trump announced the 10 percent increase, they announced plans to retaliate and have since implemented retaliatory tariffs, 15 percent on U.S. products like chicken, wheat, and corn, as well as 10 percent on products like soybeans, pork, beef, and fruit.
So now that we're up to speed on what's happened so far, let's discuss what's on the horizon. Shortly before we recorded this episode, the EU responded to the newly implemented Section 232 tariffs by announcing plans to implement retaliatory tariffs on up to 28 billion worth of American goods, including motorcycles, bourbon, and boats. These will start in April. This is a very similar response to how they responded back in 2018 to the original Section 232 tariffs, where they hit back with levies on American products like Harley Davidson motorcycles and Kentucky bourbon. Again, this is a very recent development that was announced shortly before we recorded, and it's likely by the time you're listening to this that either Canada has announced retaliatory measures of their own, or Trump has announced additional tariffs on the EU.
Next, the exemption for Canadian and Mexican goods covered under USMCA will expire on April 2nd. While there is always a possibility that these will be delayed once again, don't count on it, especially in light of Canada's recent retaliatory measures. And even if there are additional exemptions, they will probably only apply to select goods.
Also, there are the reciprocal tariffs, which, like the Canada and Mexico tariffs, are expected to take effect April 2nd. In recent weeks, Trump has stated that he already has plans for nearly every country the U. S. does business with, saying broad reciprocal import taxes are in fact coming and will be consistent with levies other countries charge the United States manufacturing base to export their goods.
Another important thing you should stay on top of in this ongoing trade war with China. As previously mentioned, China has issued a series of retaliatory tariffs, first in response to the initial 10 percent tariff implemented by the Trump administration, and second in response to the 10 percent increase a few weeks later. Trump hasn't announced any retaliatory measures so far, but it is very likely that he will in the coming weeks.
In addition to these tariffs and immigration policy adjustments, other big changes likely to impact the manufacturing and distribution sectors that we can expect under the second Trump administration include incentives for domestic manufacturing such as tax breaks, R&D incentives, and subsidies to boost domestic production.
Tax policy reforms, which could include full expensing provisions, interest rate reductions, a lowered corporate tax rate, and territorial tax adjustments. Regulatory reforms, including loosening emission standards and green regulations that currently hinder oil and gas drilling, as well as coal mining.
Simplifying permit processes for factory expansion, dropping the previous U. S. Department of Labor's defenses to the employer groups, and rolling back the rule to the original Trump independent contractor rule, which will make it easier to classify workers as independent contractors.
As far as trade agreements and supply chain realignment go, the United States Mexico Canada, or USMCA, requires a joint review by July of 2026 and agreement by all three parties to continue. However, with Trump back in office, this review will likely become more of a full fledged renegotiation. In fact, due to the ongoing trade war between the U.S. and Canada, Ontario Premier Doug Ford and U. S. Commerce Secretary Howard Lutnick are actually meeting in Washington to begin this process a year early.
Also, in order to counterbalance Chinese influence, Trump could potentially pursue agreements with other countries in Asia like India, South Korea, and Vietnam, where some of the trade has been moved from China to likely avoid any type of increasing tariff. Again, we know it can be hard to keep up when things are changing by the hour, and our Navigating Trump 2.0 page serves as a single source of truth for those looking to keep up with these changes. The link to this page is in the description, and we're updating this page constantly with all new developments that you should be aware of. Also, every Friday, starting this week, we'll be publishing an article accessible from this page that will recap all the administration's latest actions and new developments each week that manufacturers and distributors should be aware of.
Now, last but not least, how should businesses proceed in this rapidly changing and highly uncertain environment? If your business is dependent on foreign imports, time is of the essence and there must be a sense of urgency, and you should have already started the process of identifying domestic suppliers.
If you can't do this quickly, you'll be forced to either eat the cost for the time being, or pass them along to consumers and lose your position in the market. Don't count on more exemptions. If your company has outsourced operations, the same is true. The pandemic era should have been a wake up call and made clear the risks of being reliant on extended supply chains that are highly susceptible to the whims of geopolitical conditions.
But if it wasn't, now is your final chance. If you can't reshore production, you will simply get crushed by these tariffs in the near future, which is the whole point. This is why companies like Apple, VW Group, and Honda have already stated plans to shift production to the U. S. over the past couple of weeks.
If you're a domestic manufacturer, you truly have the opportunity of a lifetime in front of you. But in order to capitalize, you'll need to take action now. This is much easier said than done, however. Increasing production capacity typically means investing in new equipment, additional full time employees, and potentially even new facilities.
Not only do all of those options have a long implementation period, but they can be incredibly risky. Even in a perfectly stable economy, it can take years to see a return on investment, which can be a prohibitive factor for small and medium sized businesses, which typically lack capital and make up the majority of the manufacturing sector.
Additionally, we don't really know what's in store for the coming months. If you're a domestic supplier of steel, for example, you know that business will increase in the coming months, but you don't really know by how much. If you estimate a 40 percent increase in demand and only see a 25 percent increase, now you have to choose between either laying off some of the workers you just spent months running through the hiring process or eating the cost for the time being and hope that demand increases.On the flip side, if you estimate a 30 percent increase and actually see a 50 percent increase, now you are severely capacity constrained and unable to take on new business, even with mandatory overtime. At this point, you can attempt some sort of emergency hiring spree, but this will likely take several weeks considering the administration's crackdown on illegal migration and the fact that so many businesses are trying to compete for the same workers all at once.
Meanwhile, you're leaving the door wide open for better prepared competitors. Examples like this are one of many reasons why at Veryable, we feel that having a fully fixed workforce makes absolutely zero sense. Thankfully, Veryable unlocks a better option. If you're not already familiar with our concept at Veryable, we operate on the idea that flexibility, agility, and speed are the ways to win in today's manufacturing and distribution environments. Current world events are highlighting the need for this more than ever, and Veryable enables this for businesses through the concept of a labor pool. A labor pool is a flexible extension of your full time workforce that you can tap into on an as needed basis. To use a sports analogy, think of a labor pool like a sideline bench of trained workers who are ready to jump in whenever needed.
Whether you are predicting that businesses will boom in the coming months or your company is trying quickly to move production back to a domestic facility from a tariffed region, on demand labor can help you quickly scale up without the need for several week long hiring processes or the risk of getting it wrong and ending up either overstaffed or severely capacity constrained.
Compared with direct hiring or temp staffing, with Veryable businesses can find workers with only one to two days of lead time and maintain full control over worker selection. For each of the more than 700,000 thoroughly vetted and ready to work operators on the Veryable platform, businesses have access to a live resume that shows a rating of five stars based on proficiency, safety, and attitude for every op completed, a reliability score based on timeliness and attendance history, relevant skills, and more. Previous work experience, relevant certifications, endorsements of skills and experience from other platform business users.
While Veryable provides you with more information about a worker than a resume or what a staffing agency would provide, it wouldn't be realistic to assume that you'll absolutely love every single worker on the platform. Thankfully, if a worker doesn't live up to your expectations, for whatever reason, you can rate them accordingly and have a new one in the next day. With staffing agencies or direct hiring, you simply don't have this option.
If you hire someone that doesn't live up to your expectations, it will likely take weeks until you can find a replacement. If business is picking up, you might just have to bite the bullet for the time being and hope they don't make any major blunders. Otherwise, you'll be forced to burn out your core team with overtime to keep up.
But the benefits of a Veryable workforce strategy extend far beyond quick and easy access to an essentially unlimited supply of skilled, Vetted and legal labor. Building a labor pool enables real time response to demand and changing market conditions, which provides a massive competitive advantage in today's uncertainty. Everyone wants to be able to aggressively go after new market share, but at the same time, nobody wants to be stuck with their pants down and end up with a bloated head count that destroys profit margins on slower days.
With Veryable, you simply don't have to worry about this anymore. With a Labor Pool, companies can maximize fixed costs by maintaining a lean, full time headcount while simultaneously maintaining the capacity to capitalize on anything that comes their way. This truly provides the best of both worlds. In addition to helping businesses seize new opportunities without the risks, a Labor Pool helps you create down cycle agility and build a layer of resilience into your operations.
If demand suddenly drops, whether for a few days or a few weeks, which is certainly a possibility in the event of any retaliatory tariffs, businesses can simply taper down Veryable platform usage and just like that, they're back down to a lower headcount without the need for any layoffs. Then when demand increases again, they can scale back up just in time with just a few clicks.
Another advantage of the Veryable platform is that businesses only pay for work once it's completed. While we feel very strongly that it's best to build the ark before the flood, smaller businesses in particular often lack the capital for massive up front investments into new FTEs, facility upgrades, or new equipment.
With Veryable, these businesses don't have to worry about this and they can find the help they need on short notice to maximize their existing capabilities at zero cost to scale. One way that manufacturers commonly use Veryable to quickly increase production capacity is to provide support to their highly skilled full time employees.
A welder, for example, may only spend half of their day actually welding. And with Veryable Operators brought in to help prep, clean, and move materials, this welder can produce significantly more, which not only helps your business, but keeps these skilled workers happy by allowing them to focus more on their main duties.
But Veryable Operators can do much more than provide assistance to your highly skilled, full time employees. On the Veryable Platform, there's more than 220,000 workers skilled in machining, welding, engineering, and tooling, many of whom possess certifications. Regardless of whether your business is a domestic manufacturer, Reliant on imports or has previously outsourced manufacturing operations to tariff regions.
You'll need to act now to capitalize on emerging opportunities and maintain profitability. The cost of an action is always greater than the cost of preparation. The best time to build flexibility and agility into your operation was before the crisis. The next best time is now.
The companies that thrive in the coming months won't be the ones with the most resources. They'll be the ones who can adapt the fastest. On demand labor isn't just a labor solution. It's a competitive advantage built by those who have walked a mile in your shoes. This isn't some generic workforce solution trying to adapt to manufacturing. It's purpose built for the way your operation actually works.
To learn more about the Veryable solution, how you can build your labor pool, check out our website at www.veryableops.com. Additionally, if you look under the resources, drop down menu at the top and click on the info for your role page, you'll find more information tailored to your exact role. Also under this same resources menu, you'll be able to access our Navigating Trump 2.0 page as well as case studies and our thought leadership blog.
Thank you for joining us on our first episode and following along in this rapidly evolving environment and learning more about how you can make your way.