A new study from the Federal Reserve found that President Trump’s tariffs are backfiring.

According to the Fed study, the tariffs that went into effect in 2018 have led to not only higher producer prices but also a loss of jobs across the U.S. — particularly in manufacturing. A previous analysis also found that tariffs have cost the U.S. $42 billion so far.

“In terms of manufacturing employment, rising input costs and retaliatory tariffs each contribute to the negative relationship, and the contribution from these channels more than offsets a small positive effect from import protection,” the new Fed study stated. “For producer prices, the relative increases associated with tariffs are due solely to the rising input cost channel. We find little evidence for a relationship between industrial production and any of the three tariff channels considered.”

View photos President Donald Trump speaks to 5000 contractors at the Shell Chemicals Petrochemical Complex on August 13, 2019 in Monaca, Pennsylvania. (Photo: Jeff Swensen/Getty Images) More

‘You cannot simply raise tariffs’

Back in December 2018, Trump tweeted: “Almost 500,000 Manufacturing Jobs created since I won the Election. Remember when my opponents were saying that we couldn’t create this type of job anymore. Wrong, in fact these are among our best and most important jobs!”

However, the tit-for-tat tariffs between the U.S. and China have thrown a wrench in his plans to revitalize the manufacturing sector.

“While the longer-term effects of the tariffs may differ from those that we estimate here, the results indicate that the tariffs, thus far, have not led to increased activity in the U.S. manufacturing sector,” the Fed study stated.

According to the study, the industries hardest hit by the retaliatory tariffs from China include producers of aluminum sheet, iron and steel, motor vehicles, household appliances, and computer and other electronic equipment.

View photos Manufacturing is the industry hit hardest by the 2018 tariffs. (Photo: Federal Reserve) More

Doug Barry, senior director of communications and publications for the U.S.-China Business Council (USCBC), told Yahoo Finance that the findings came as no surprise.

“They reflect what we have been hearing anecdotally for quite some time,” he said. “As the report authors note, in an era of globally interconnected supply chains, you cannot simply raise tariffs on imports to protect domestic manufacturing because a lot of those imports are actually intermediate goods that domestic manufacturers need.”

The Fed study noted this as well and highlighted that the retaliatory tariffs from U.S. trading partners offset any positive gains that came from reduced competition.

“These retaliatory tariffs may harm U.S. manufacturers by decreasing their competitiveness in foreign markets,” the Fed study said.

According to the USCBC, exports to China support over 1.1 million American jobs. Factory workers have particularly bearing the brunt of the retaliatory tariffs from China — the October 2019 job report highlighted the contraction in total factory payrolls, “which not only increases price for companies but also causes investment uncertainty,” according to Bloomberg.

‘The consequences will be very bad’

View photos U.S. President-elect Donald Trump stands with Carrier worker Sadieka Alexander while touring a carrier factory in Indianapolis, Indiana, U.S. (Photo: REUTERS/Mike Segar) More