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What does Trump’s “Buy American” executive order mean for the transportation industry?

buy american

Last month, President Trump’s office released his much-anticipated Buy American, Hire American executive order. The new order is meant to protect American jobs, by encouraging companies to buy and sell American-made products, and by reviewing the country’s H1-B visa program for highly-skilled workers.

The president campaigned heavily on a promise to revive American industries, and create American jobs. This new executive order will kick-start that process, according to the White House. So what’s included in the Buy American executive order, and what effects could it have on American transportation?

American Workers, American Goods

The Buy American order includes two main objectives: to stimulate USA manufacturing by tightening requirements that industries use American-made goods, and to review the USA’s visa policy for skilled immigrant workers. Its language is broad, and how it will be enacted and enforced remains to be seen. However, American industry across the board will likely see more scrutiny in the coming months, especially regarding where they buy their goods, and who they hire.

For the transportation industry, there may be a crackdown on vouchers for foreign-made goods, which transportation projects use to buy imported goods when they can’t find what they need made in the USA. Initially, this could drive the cost of projects up. However, it depends on how seriously the executive branch decides to enforce the order, whether they have the support of Congress, and what they find out during their assessments of the transportation industry in the coming months.

Steelworkers are particularly interested in Trump’s Buy American order, because he’s promised to use it to bolster US-made steel. Trump signed the executive order just a day before an important directive about foreign-made steel, which skyrocketed USA steel stocks. This directive calls for a probe into whether foreign steel is a threat to national security. It’s expected that the Trump administration will use both initiatives to crack down on transportation, and other infrastructure-related, projects that use foreign steel.

Transportation May See Labor Shortages due to Buy American, Hire American Executive Order

However, where this could have the most far-reaching implications for transportation is in the hiring process. The Buy American order promises to review the country’s H1-B visa program, which is specifically used for hiring highly-skilled workers. This type of visa is intended for workers with extraordinary talent and training, when companies can’t find an American worker with the necessary skills.

The H1-B visa has been steadily growing in popularity for several years, as foreign workers have rigorously trained and built their skill sets to meet America’s demand. This new executive order calls for a probe of this program, to determine whether abuses are happening, and whether H1-B visas are doing their job of bringing in foreign workers only when an American with the right skills isn’t available. For transportation, a crackdown on H1-B visas could mean a shortage of engineers, computer scientists, and other highly-skilled professionals to plan new projects.

A shortage in this area could actually hurt transportation, causing new projects to stall and prices to go up. The Trump administration, however, claims this review– and possible tweaks in the program– will keep wages up and create more opportunities for American workers.

Transportation Training for Americans

The question is whether American workers will have the skills and education to perform these jobs that are currently going to foreign workers on H1-B visas. Currently, it appears that they don’t. If the transportation industry wants to grow and thrive under the “Buy American, Hire American” directive, industry leaders would do well to increase their focus on training here in the USA.

Lots of questions about the new directive will be answered in the coming months. Initially, the transportation industry should prepare for more scrutiny, by making sure that they are following all the rules when it comes to hiring and buying goods. Everyone involved in the transportation industry should also take extra care to comply with all their insurance, licensure, and bonding requirements.

Lastly, to keep transportation growing and thriving under the new administration, the country will need a fresh look at domestic training programs. The economy has suffered from labor shortages for years, and the USA will continue to rely on foreign workers unless government officials and business leaders cooperate, to create more training opportunities for American workers.

What is your take on Trump’s Buy American executive order and its implications for the transportation industry? We’d love to hear from you in the comments below.

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Todd Bryant

Todd Bryant

President & Founder at Bryant Surety Bond
Todd Bryant is the president and founder of Bryant Surety Bonds. He is a surety bonds expert with years of experience in helping freight brokers get bonded and start their business.
Todd Bryant
Todd Bryant
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