Editorial: Small businesses are tariff casualties

Not every company that uses steel is a global giant.

They aren’t all traded on the stock exchange. They don’t all employ thousands. Sometimes it’s a small company with small margins.

But manufacturing matters whether it’s a major power or a minor one. That is why many buckled in for the bumpy ride when it came to steel tariffs.

“I thought it was going to be a better overall process for us,” said James Philipkosky, chief executive of MLP Steel in Scottdale.

It wasn’t. The 25% tariff placed on imported steel didn’t improve business. It forced MLP to absorb increases instead of passing them along to customers when steel prices rose.

Bellevue’s JATCO Machine & Tool did charge its customers more. The company also said why on the bills, making sure its buyers knew the hike was due to the tariffs.

So how does something that was supposed to help manufacturing not help all manufacturers?

The issue may be that President Trump’s focus was very big-picture with regard to overall trade imbalances. That makes sense, especially when talking about a massive building-block kind of commodity like steel. It seems almost too big to have smaller players. Even in Pittsburgh, it’s easy to see U.S. Steel as representing the industry as a whole rather than just being one — albeit large — part of something bigger.

With agriculture, the idea of smaller farms side by side with conglomerates was obvious. With manufacturing, it might need reinforcement.

Less steel was imported over the last two years. Some mills are making metal again. There are investments planned, like the $1 billion into the Mon Valley Works that U.S. Steel promised in May 2019. Those are positive moves, but that doesn’t mean some of the little guys aren’t collateral damage.

As the U.S. and China come to a truce in their trade war with Wednesday’s signing of a new “phase one” agreement, the Asian superpower pledges to up its purchases of American goods. That could definitely help manufacturing large and small.

But a second phase of the agreement down the road is promising action on tariffs. Let’s hope that road isn’t too long, because smaller manufacturers can’t wait forever.