Bethlehem Steel operated from 1857 to 1995
Joe Mayer and his good friend Mike Dzwonczyk spent their entire careers working at Bethlehem Steel, as a foreman and in the plant’s blast furnace, respectively. In the 1980s they used to go to Washington D.C. with other steelworkers by the busload to lobby the government for tariffs on foreign steel imports.
Now their position has flipped: they both oppose the 25% tariffs the Trump administration imposed on steel imports on Mar. 12. “Because,” Dzwonczyk said, “it’s going to drive prices up on your food and your gas.”
What changed?
Experience, according to Mayer. “We have a bad feel for it,” he said. “It didn’t work before. Why was it going to work now?”
On the campaign trail and now as president, Donald Trump has promoted tariffs as a way to preserve and even create jobs. “Tariffs are not just about protecting American jobs,” he said in his address to Congress on March 4. “They’re about protecting the soul of our country.”
According to many economists, though, any gains made from steel tariffs are likely to flow into company profits, not boost wages or create new jobs. The experience Mayer and Dzwonczyk referred to might be a guide: while the steel tariffs Trump imposed during his first term produced a modest gain in steel-producing jobs, they also came at a steep cost. One study found that the tariffs caused a net loss of 75,000 jobs in the steel-consuming industry, which employs 45 times the number of people who work in steel production.
That’s because tariffs allow domestic producers to raise their prices, eating into profits downstream at steel-consuming companies and forcing them in their turn to raise prices. Higher prices lead to diminished global competitiveness and consumer demand, meaning there’s less money to invest in workers.
Mayer, the foreman, started working at Bethlehem Steel when he was still in college, in 1969, and stayed until it shut down in 1995. His father spent 36 years at the same company in the straightening gags, where beams that came out bent or curved were straightened. Mayer’s grandfather worked for 36 years at the company as a crane operator.
During Mayer’s forebears’ time Bethlehem Steel was an economic powerhouse that at its height employed some 24,000 people and produced the steel used in projects from the George Washington Bridge to the Golden Gate Bridge. Mayer described the plant’s closing in 1995 as “devastating news.” Thousands of workers lost jobs and health insurance, the city lost tax revenue and the area, Mayer said, lost its identity.
The long-standing financial stability that gave Mayer and Dzwonczyk a foothold in the middle-class, and the symbolic resonance of steel as a symbol of national strength, help explain why steel workers support the tariffs. The United Steel Workers union, for instance, said in a press release that the tariffs will correct “global overcapacity that for too long has threatened key domestic industries and with them good, community-sustaining jobs.”
Steel companies, however, not the union’s workers, will likely be the biggest beneficiaries from the tariffs. The 2018 levies did not cause wages to go up. But they did help steel companies, and their shareholders, to earn record profits. According to the Peterson Institute for International Economics, a nonpartisan think tank that supports free trade, steel producing companies were set to make an additional $2.4 billion as a result of the tariffs. Gary Hufbauer, a senior fellow at the institute, said every steel job created by the 2018 tariffs cost consumers as much as $800,000. That money mostly went to profits, not wages or jobs.
Those profits are the reason the powerful steel lobby has worked for as long as 50 years to get protectionist measures put in place. The new tariffs are the culmination of those decades-long efforts. But according to Inu Manak, a fellow at the Council on Foreign Relations, a foreign policy think tank, tariffs disincentivize steel companies from making additional hires. “If you’re in a protected market where you have no foreign competition,” said Manak, “why would you hire more workers?”
Still, some workers could benefit from the tariffs. According to Lisa Harrison, Senior Vice President for Communications at the American Iron and Steel Institute, an industry trade association that supports the tariffs, the 2018 protectionist measures caused 10,000 workers to return to their roles in steel production. And the steel industry argues those are very good jobs. The member companies of the Steel Manufacturers Association “usually offer the highest paying and best benefit jobs in the communities where they operate,” said Philip K. Bell, the association’s president.
But Tom Prusa, an economist at Rutgers University, points to increased efficiency and technological innovation as the most important factors causing job losses in steel production, which now employs roughly 80,000 workers in the US, down from a height of around 700,000 in the 1950s. Even if all steel production were done domestically, Prusa said, it would never create what Trump described in his address as “jobs like we have never seen before.”
The 2025 tariffs are more expansive than the ones implemented in 2018. This time around there probably won’t be any exemptions for countries like Brazil; product-specific exemptions like those negotiated in 2018 will also not be allowed, the administration has said. Despite Trump insisting that American consumers won’t bear the burden of the tariffs, long-standing economic research suggests that prices for goods that use steel will inevitably go up. “Waves of cost increases are coming across the US economy,” said Prusa, the Rutgers economist.
Bethlehem eventually bounced back from its slump after the steel plant closed. Mayer says the city fared better than others because of a redevelopment plan that converted parts of the steel factory into an industrial museum and the Sands Casino. He’s glad the casino offers employment in the area even though he says the jobs there are not as good as the ones he and Dzwonczyk had in steel production. Still, though, for Mayer nostalgia for the years of booming steel production is not the answer.
“Change isn’t necessarily a bad thing,” he said, “but it’s how you adapt. It’s not that you’re on the floor. How do you get off the floor?”
