Using elasticity approach and input-output technique, we analyze the shock of Sino-US trade tariff war on bilateral economic growth and labor market from the perspective of global value chain. Our results show that China will suffer from huge losses at exports, value added and employment if US raises tariff sharply. Not only will China suffer loss, but US will suffer loss as well since China’s intermediate imports from US will decline dramatically. In the case of bilateral trade war, China will suffer much more losses than US since China’s degree of dependence on foreign trade is much higher. What’s worse, Sino-US trade war will break up parts of global production chains, all the countries on the chains will suffer losses and the risks of global downturn will increase. The results suggest that American trade protectionism is bad for bilateral economic development, and Sino-US trade war will bring lose-lose consequences. Continuing opening-up and advancing win-win cooperation is the optimal strategy.