8th September 2018, 07:03:50A new report by global technology consultancy firm, WPP has shown that big tech giants are about to face a “massive” wave of layoffs as the US economy falters in the face of Donald Trump’s proposed tariffs and tax hikes.
The news comes just weeks after US stock market futures closed down by over 2%, and in a sign that Trump’s trade war with China is likely to be an ongoing one as he moves to ramp up trade, he also plans to impose tariffs of up to 35% on US imports.
In a report titled “Huge layoffs looming for big tech”, WPP analysts have estimated that the number of jobs in the US technology sector could drop by more than 50% over the next six years, to around 20,000.WPP’s report also predicts that there will be a “significant impact” on the US healthcare system as the jobs lost from the tax hikes will likely be replaced by cheaper, less expensive healthcare, with those earning between $20,000 and $60,000 being most affected.
The report estimates that the job losses would be the equivalent of more than 4 million people leaving the US, with most of those jobs likely to move to other countries in Europe.
While WPP’s analysis has been criticised by some for being overly pessimistic, its authors also warned that there is still a chance that the US could remain in the top spot on the list of the world’s most productive economies.
It comes as Apple reported a “slight” drop in third quarter profit as revenue fell by about 2.1%, but the company’s stock price rose to $180, up 5.7% on the day.
The company also said it had raised its full-year revenue forecast to $9 billion.
The latest report comes as the Trump administration has been preparing to impose a tariff of 35% to protect US jobs from being lost from Trump’s crackdown on the world of tech.
According to the US Department of Commerce, US trade with China has fallen by almost 30% since the start of the year, but the Trump Administration has been working to accelerate the tax and trade sanctions that are expected to be imposed by President Donald Trump as part of his crackdown on tech companies.
“There is some indication that the Trump-led administration will impose additional tariffs on Chinese imports and exports this year, potentially triggering a trade war,” WPP said.
“These tariffs will likely lead to a reduction in overall US trade, which could have a substantial impact on the overall US economy.”
In 2018, the US will experience a major trade war and the impact of that trade war on the economy will be enormous.
“Trump’s crackdown against China was prompted by a series of anti-trade protests that have been taking place across the US.
Earlier this month, the president signed a new executive order that imposes a 45% tariff on imports from China for two months, and on US-made goods for six months.
Trump has also promised to “take the gloves off” on his trade war against China, and he has promised to impose new tariffs on “every single” country in the world.