Expanded tariffs could shield some manufacturers from foreign competition. Economists, however, warn they might also fuel inflation.
Trump’s Vision for a Manufacturing Renaissance
Donald Trump, the president-elect, has pledged to revitalize U.S. manufacturing. He proposes tariffs to protect domestic companies, aiming to increase the appeal of American-made products by raising the cost of imports. These tariffs have earned praise from manufacturers facing competition from low-cost imports, particularly from countries like China. Economists, however, caution that such measures may increase inflation and interest rates, ultimately harming the broader economy.
“It does offer a measure of protection for manufacturers,” said Gary Schlossberg of Wells Fargo Investment Institute. “But depending on where you are in manufacturing, that [inflation] could work against you.”
During his first term, Trump imposed tariffs on products like solar panels, washing machines, and metals. Joe Biden maintained most of these tariffs and added new ones targeting Chinese goods such as electric vehicles and semiconductors. Trump now plans more aggressive measures, including tariffs of 60–100% on Chinese imports and up to 20% on goods from other countries.
In a September speech, Trump said, “We’ll lead an American manufacturing boom. When they have to pay tariffs to come in but have an incentive to build here, they’re going to come roaring back.”
Economists, however, warn that these policies might trigger inflation and rising interest rates. Companies like Autozone and Stanley Black & Decker have already indicated they would pass higher costs onto consumers.
The Peterson Institute for International Economics estimates these tariffs could cost the average U.S. household over $2,600 annually. A National Retail Federation report suggests consumer spending power could drop by $46–78 billion yearly. For example, $50 athletic shoes could rise to $64, and a $2,000 mattress set could increase to $2,190.
“Most of us feel the tariffs are detrimental to the economy overall,” Schlossberg said, “even though they may benefit some manufacturing sectors temporarily.”
Matt Bigelow, president of Vermont Flannel, expressed concerns about inflation’s impact on his business, which imports fabric from Europe. “If tariffs ultimately increase consumer prices, then I think that’s a concern,” he said.
Economic Impacts and Job Prospects
Some manufacturers view tariffs as a way to level the playing field. Stephen Liquori, CEO of Goodwear USA, sees potential benefits in making imported goods pricier. Still, he remains cautious about their economic ripple effects. “We can’t make or don’t make everything here. It’s a global economy,” Liquori said.
Optimism persists among others, like Drew Greenblatt, president of Marlin Steel. He expects new tariffs to benefit his U.S.-sourced steel business and hopes to double his workforce of 115. “This is going to be very good for the American factory worker,” he said.
A Coalition for a Prosperous America study suggests a universal 10% tariff could create 2.8 million jobs. However, a Brookings Institution study found that first-term tariffs under Trump created jobs in some sectors but caused losses in others dependent on imports or retaliatory tariffs.
Bayard Winthrop, CEO of American Giant, supports rebalancing trade with China through tariffs but advocates a measured approach. His company, which sources all materials domestically, sees tariffs as a tool to grow U.S. industrial capacity and strengthen the middle class. “There will be some increase in costs—that’s the price you pay,” he said. “But it will start to establish industrial capability in the United States.”
Scott Paul, president of the Alliance for American Manufacturing, echoed the importance of strategic tariff application. “If we’re looking to decouple or de-risk our economy from China, that’s an important policy step we have to take,” he said.
