How has the North American Free Trade Agreement, or NAFTA, affected the number of manufacturing plants in the United States since its enactment in 1994? It’s been a big negative, President Donald Trump told Fox News’ Sean Hannity during an interview in Las Vegas.
Trump, who has negotiated with both Canada and Mexico to replace the current agreement, told Hannity, "NAFTA was a disaster. We lost thousands of plants. We lost millions of jobs. NAFTA was a disaster."
We take up Trump’s statement about job losses in a separate fact-check. Here, we’ll look at the question of plants that have been lost post-NAFTA.
The United States saw a loss of more than 80,000 manufacturing establishments from 1994 through 2014.
Data from a Census Bureau series, Business Dynamics Statistics, tallied 357,330 manufacturing establishments in 1994 and 274,756 in 2014, the last year for which data is available.
Granted, it’s unlikely that every shuttered manufacturing plant owes its closure to NAFTA. Among other things, advancements in technology have revolutionized manufacturing in recent years.
But even if a small fraction of the closures stem at least in part from NAFTA, then Trump’s use of "thousands" is valid.
Trump said that since NAFTA, "we lost thousands of plants."
That's actually an understatement. The United States lost 80,000 plants since then. Not all can be blamed on NAFTA, but even if only a fraction of them can be, Trump has a point. We rate the statement Mostly True.
Editor's note, Sept. 24, 2018: PolitiFact has joined an effort with other North American fact-checkers to examine statements about trade and tariffs. Poynter.org is documenting the project; see its report for links to other fact-checks.
Census Bureau, Business Dynamics Statistics, accessed Sept. 21, 2018
Economic Policy Institute, "The effects of NAFTA on US trade, jobs, and investment, 1993-2013," 2013
Economic Policy Institute, "China Trade, Outsourcing and Jobs," Dec. 11, 2014
U.S. Chamber of Commerce, "OPENING MARKETS, CREATING JOBS: Estimated U.S. Employment Effects of Trade with FTA Partners," 2010
U.S.-China Business Council, "USCBC: EPI Study on US Jobs, Trade Deficit, and China Currency is Wrong," Dec. 12, 2014
Financial Times, "In charts: what Donald Trump gets wrong about China and US jobs," March 24, 2016
Drusilla Brown, Alan Deardorff and Robert Stern, "Multilateral, Regional, and Bilateral Trade-Policy Options for the United States and Japan," Dec. 16, 2002
Congressional Research Service, "Free Trade Agreements: Impact on U.S. Trade and Implications for U.S. Trade Policy," Feb. 26, 2014
PolitiFact, "Clinton voted for 'virtually every' trade agreement, killing millions of jobs, Sanders says," April 10th, 2016
PolitiFact, "Donald Trump quotes Bernie Sanders' Half True claim about Clinton, free trade," June 29, 2016
PolitiFact, "Trump: Since China joined WTO, U.S. has lost 60,000 factories," March 24, 2017
Email interview with Robert E. Scott, senior economist and director of trade and manufacturing policy research, Sept. 21, 2018
Read About Our Process
In a world of wild talk and fake news, help us stand up for the facts.