With job announcements, firms appear to seek Trump approval
WASHINGTON — From Wal-Mart to General Motors to Amazon, a growing number of the world’s largest companies appear to be trying to get in step with President-elect Donald Trump’s demand that employers hire and keep jobs at home.
Trump, in response, has taken to Twitter to signal his approval.
“Thank you to General Motors and Walmart for starting the big jobs push back into the U.S.!” he tweeted Tuesday afternoon.
Yet it’s unclear just how many jobs are actually being saved or created as a result of Trump’s push or whether his administration will hold companies accountable for their pledges. In a solid job market with just 4.7 percent unemployment, hundreds of thousands of U.S. jobs are added all the time for a broad range of reasons.
Trump has boasted that he deserves the credit based on what chief executives have told him, despite evidence to the contrary provided by those same companies.
“Ask top CEO’s of those companies for real facts. Came back because of me!” the president-elect declared on Twitter on Wednesday.
GM announced Tuesday that it was creating or keeping 7,000 jobs, while Wal-Mart said it planned to hire 10,000 and support an additional 24,000 construction jobs with store openings and expansions.
Those announcements followed Amazon’s commitment to add 100,000 workers through mid-2018 and a bold claim by the Chinese online retailer Alibaba that it would create 1 million U.S. jobs over the next five years. That extravagant pledge would make Alibaba alone responsible for over 10 percent of all jobs added each year — an unheard-of feat in the modern economy.
Many economists say the hiring being celebrated by Trump reflects, more than anything, the health of the $18.7 trillion economy he is inheriting.
“Between the election and today, unless you work on Capitol Hill in D.C., nothing fundamental has changed in the U.S. labor market,” said Andrew Chamberlain, chief economist at the jobs site Glassdoor.
To these economists, the latest high-profile hiring announcements suggest that companies are capitalizing on the politically charged climate. Trump has berated companies such as Nabisco for shuttering domestic plants in order to open factories in Mexico, while celebrating companies that publicly commit to hiring in the United States.
What’s more, nearly every major U.S. employer has tax and regulatory issues before the government. To that end, a sympathetic ear in the White House could be helpful.
The heads of German chemical company Bayer and seed-and-herbicide-maker Monsanto met with Trump last week to pitch the benefits of a planned-for merger of the two companies that requires antitrust clearance. And Trump proudly tweeted reports Wednesday that Bayer would add U.S. jobs.
By announcing new jobs, companies can use any existing hiring plans to ingratiate themselves with Trump by hitching their plans to his economic agenda, noted Patrick O’Keefe, director of economic research at the consultancy and accountant CohnReznick.
“There is a degree of opportunism — in a positive way,” O’Keefe said.
GM plans to invest $1 billion in its U.S. factories and to create or keep 7,000 jobs — moves that the company had said were being planned well before the election. Trump had drawn attention to GM this month by threatening on Twitter to tax the automaker for selling Mexican-built cars in the United States. That set up GM’s jobs announcement as a coup for Trump, even though the investment was already in the works.
A GM spokesman said it was “good timing for us to share what we are doing.”
Wal-Mart’s hiring similarly seems somewhat independent of Trump. The jobs stem largely from plans to open and remodel stores— work that would not be outsourced overseas. Wal-Mart is the nation’s largest private employer, with 1.5 million workers in the United States, and its hiring rate this year will be similar to prior years, said Lorenzo Lopez, a company spokesman.
These announcements follow hiring plans announced by Ford and Fiat Chrysler, among others. The auto executives were willing to let Trump promote their hiring plans, even though their decisions involved other market forces, including increased demand for SUVs as gasoline prices have dropped.
Hyundai said Tuesday that it plans to invest $3.1 billion by 2021 on research and development at its factories in Alabama and Georgia. Chung Jin Haeng, chief executive of the South Korean automaker, said the decision had little to do with Trump.
“The U.S. market is strategically important,” he said.
At the same time, Trump has also talked with companies about cutting their costs — a move that often involves slashing jobs. He met Tuesday, for example, with the CEO of Boeing, a company he had criticized in December over Twitter for the “out of control” price of two new planes for the Air Force One fleet. CEO Dennis Muilenburg said he chatted with Trump about how to lower the costs for the presidential planes as well as fighter aircraft.
“I think Mr. Trump is doing a great job with engaging the business,” Muilenburg said afterward. “We’re all on the same page here.”
Not all the job announcements will necessarily come to fruition. Alibaba has said it expects to add a million U.S. companies to its online retail platform in the next five years. It asserted that sales to Chinese consumers would lead each of those companies to add, on average, one job each. This would translate into an astounding 250,000 a jobs a year in an economy in which every employer, combined, added 2.2 million jobs in 2016.
“It’s not rocket-science math,” said company spokesman Brion Tingler, who nevertheless cautioned that the 1 million jobs being publicized were an “aspiration.”
Other than his social media megaphone, Trump doesn’t appear to have the means to hold companies accountable for their jobs pledges.
His transition team didn’t respond to questions about how it planned to ensure that CEOs’ promises to create U.S. jobs were fulfilled.