As a result of the General Motors strike, more than 100 of the auto maker's suppliers have laid off as many as 12,000 of their own workers, according to an industry trade group.
The largest U.S. labor strike in a decade is starting to ripple through the nation’s economy, with the potential to weaken data on manufacturing and jobs that economists are scrutinizing for signs of a recession.
as companies step down investment amid uncertainty caused by the U.S.-China trade war and global slump. Although economists expect the strike’s effect to be temporary, deterioration in economic reports would create challenges for forecasters, who see a 35% chance of recession over the next 12 months.
Effects of the strike could also create noise in the data that’s “going to make it harder to get a sense of how the manufacturing sector is holding up,” said Sarah House, senior economist at Wells Fargo & Co. “It could make it hard to determine how much momentum the economy is losing right now.” As a result of the stoppage, more than 100 of GM’s suppliers have laid off as many as 12,000 of their own workers, including truckers, parts makers and suppliers, according to the Original Equipment Suppliers Assn., an industry trade group. Less tangible is the slowed business at local restaurants, cafes and retailers.While total car production makes up only about 0.8% of gross domestic product — and GM accounts for about a fifth of that — the strike likely reduced manufacturing output by 0.
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