On July 27, 2025, former President Trump announced a significant trade agreement between the U.S. and European Union. Under the deal, the U.S. will impose a 15% tariff on most EU imports in exchange for two massive commitments:
- The EU will purchase $750 billion in American energy exports, including oil, natural gas, and renewables.
- The EU will also invest $600 billion into U.S. infrastructure, manufacturing, and strategic industries.
The deal was marketed as a “win-win” for both sides, but in reality, its impact will be far more nuanced, especially when it comes to American jobs. While it could unlock historic investment and industrial growth, it also imposes new costs and risks on sectors heavily integrated with European supply chains.
Here’s a deeper look at where jobs could be lost—and where they could be created.
Where Jobs Could Be at Risk
1. Import-Reliant Manufacturers
Many American manufacturers depend on precision machinery, electronics, and materials imported from the EU. These include:
- Automotive OEMs and Tier 1 suppliers
- Aerospace and defense contractors
- Industrial automation and robotics manufacturers
- Medical device and life sciences firms
Risk: A 15% tariff on components or machinery from Germany, Italy, and France could increase input costs, delay deliveries, and force layoffs or offshoring if companies can’t adapt quickly. Job losses could hit hardest in Ohio, Michigan, Illinois, and Pennsylvania.
2. Retailers and Distributors of European Goods
The U.S. market is flooded with EU-sourced consumer products: fashion, appliances, beauty, luxury, wine and spirits. The companies distributing these goods include:
- Retail giants (Target, Macy’s, Nordstrom)
- E-commerce platforms
- Small businesses reliant on EU-made inventory
Risk: With tariffs inflating wholesale costs, companies face pressure on margins. They may cut staffing, limit inventory, or cancel EU contracts—affecting jobs in warehousing, logistics, sales, and customer service.
3. U.S. Agricultural Exporters
Although agriculture wasn’t explicitly targeted, trade retaliation is a real possibility. European regulators may impose technical barriers, slow-walk approvals, or reduce U.S. access to their markets.
Risk: Industries at risk include:
- California wine exporters
- Midwestern grain, pork, and dairy producers
- Processed food manufacturers
This could translate to downstream layoffs in trucking, storage, and rural economies.
Where the Deal Could Create Jobs
1. Energy & Petrochemicals
The EU’s $750 billion energy purchase commitment is unprecedented—and overwhelmingly favorable to U.S. producers.
📈 Upside:
- Gulf Coast LNG terminals (TX, LA) will expand capacity and labor demand.
- Oil and gas exploration in the Permian Basin, Appalachia, and Bakken will ramp up.
- Pipeline, port, and storage infrastructure will require skilled labor—creating thousands of union jobs in construction, transport, and engineering.
2. Clean Energy & Grid Modernization
The EU investment agreement includes earmarks for clean hydrogen, battery storage, and carbon-neutral energy technologies.
📈 Upside:
- Wind and solar developers may secure funding for new installations.
- Green hydrogen hubs in California, Texas, and the Northeast could scale production.
- The need for electricians, project managers, plant operators, and logistics teams will soar.
3. Reshored Manufacturing and Strategic Supply Chains
To avoid future tariff risks, U.S. firms are likely to reshore supply chains, especially in industries where reliability and national security are concerns.
📈 Upside:
- Semiconductors: With EU funding and domestic incentives (CHIPS Act), fabrication facilities may grow.
- EV batteries: Gigafactories and critical mineral processing plants may expand.
- Aerospace & defense: U.S. suppliers may win new contracts as European imports become costlier.
Job growth would likely concentrate in:
- Arizona (semiconductors)
- Michigan and Georgia (EVs)
- California and Alabama (aerospace and defense)
Will Companies Just Raise Prices? Not So Fast.
While import costs may rise due to tariffs, many businesses can’t simply hike prices 15%. Here’s why:
Market Forces Limit Pass-Through
- Retailers like Walmart, Amazon, and Costco resist price increases and have leverage to force suppliers to absorb costs.
- Brand loyalty is fragile—consumers will switch to domestic or non-EU alternatives if prices spike.
- Non-EU competition (from Asia or Latin America) keeps global prices in check.
Strategic Response: Innovation and Cost Control
Instead of passing costs onto consumers, many companies will:
- Invest in automation
- Re-engineer supply chains
- Partner with domestic suppliers
These moves could generate new operational roles in engineering, procurement, and logistics while preserving customer pricing.
Final Analysis: A Mixed but Manageable Picture
| Sector | Likely Impact |
|---|---|
| Import-dependent manufacturing | ⚠️ Risk of job losses or offshoring |
| Consumer goods & retail | ⚠️ Margin pressure, slower hiring |
| Energy & infrastructure | ✅ Significant job growth |
| Clean tech & advanced manufacturing | ✅ Long-term investment and hiring |
| Export agriculture | ⚠️ Retaliation risks, but unclear |
In sum, some sectors will hurt, but others could thrive—especially if public and private actors move quickly to capture the upside of new capital flows and export opportunities.
What This Means for Workers
Whether you’re a factory worker, engineer, logistics coordinator, or retail employee, this deal could reshape your job outlook in the next 6–18 months. At Employees First Labor Law, we believe in helping workers adapt, protect their rights, and thrive during times of economic transition.
Contact us today for a confidential consultation.
We’re Ready to Help
