The Blubber

Factories across China are scaling back production and placing workers on leave as U.S. tariffs—now at 145% on most Chinese imports—dampen demand from American buyers. This downturn has led to order cancellations for products ranging from jeans to home appliances, prompting some factories to reduce shifts or suspend operations entirely.

Industry groups report that many exporters are anxious, with some halting or delaying deliveries due to the trade war's impact. For instance, DeHong Electrical Products in Dongguan granted workers a month-long leave at minimum wage after clients paused orders, while Hangzhou Stellarmed advised employees to seek new jobs amid uncertainty.

In response, cities like Shenzhen are offering subsidies for trade shows and expanding export insurance to help businesses adapt. However, experts caution that restructuring China's manufacturing sector will be a prolonged and challenging process.

Meanwhile, some Chinese exporters are exploring new markets in the Middle East and Southeast Asia to offset losses, though replacing the U.S. market's purchasing power remains difficult.

The situation underscores the broader impact of the ongoing trade tensions, with both Chinese manufacturers and U.S. consumers feeling the effects of the escalating tariffs.