Analysis shows Trump’s tariffs would cost US employers $82.3 billion

An analy­sis finds that a crit­i­cal group of U.S. em­ploy­ers would face a di­rect cost of $82.3 bil­lion from Pres­i­dent Don­ald Trump’s cur­rent tar­iff plans, a sum that could be po­ten­tial­ly man­aged through price hikes, lay­offs, hir­ing freezes or low­er prof­it mar­gins.

The analy­sis by the JP­Mor­gan­Chase In­sti­tute is among the first to mea­sure the di­rect costs cre­at­ed by the im­port tax­es on busi­ness­es with $10 mil­lion to $1 bil­lion in an­nu­al rev­enue, a cat­e­go­ry that in­cludes rough­ly a third of pri­vate-sec­tor U.S. work­ers. These com­pa­nies are more de­pen­dent than oth­er busi­ness­es on im­ports from Chi­na, In­dia and Thai­land — and the re­tail and whole­sale sec­tors would be es­pe­cial­ly vul­ner­a­ble to the im­port tax­es be­ing levied by the Re­pub­li­can pres­i­dent.

The find­ings show clear trade-offs from Trump’s im­port tax­es, con­tra­dict­ing his claims that for­eign man­u­fac­tur­ers would ab­sorb the costs of the tar­iffs in­stead of U.S. com­pa­nies that re­ly on im­ports. While the tar­iffs launched un­der Trump have yet to boost over­all in­fla­tion, large com­pa­nies such as Ama­zon, Cost­co, Wal­mart and Williams-Sono­ma de­layed the po­ten­tial reck­on­ing by build­ing up their in­ven­to­ries be­fore the tax­es could be im­posed.

The analy­sis comes just ahead of the Ju­ly 9 dead­line by Trump to for­mal­ly set the tar­iff rates on goods from dozens of coun­tries. Trump im­posed that dead­line af­ter the fi­nan­cial mar­kets pan­icked in re­sponse to his April tar­iff an­nounce­ments, prompt­ing him to in­stead sched­ule a 90-day ne­go­ti­at­ing pe­ri­od when most im­ports faced a 10% base­line tar­iff. Chi­na, Mex­i­co and Cana­da face high­er rates, and there are sep­a­rate 50% tar­iffs on steel and alu­minum.

Had the ini­tial April 2 tar­iffs stayed in place, the com­pa­nies in the JP­Mor­gan­Chase In­sti­tute analy­sis would have faced ad­di­tion­al di­rect costs of $187.6 bil­lion. Un­der the cur­rent rates, the $82.3 bil­lion would be equiv­a­lent on av­er­age to $2,080 per em­ploy­ee, or 3.1% of the av­er­age an­nu­al pay­roll. Those av­er­ages in­clude firms that don’t im­port goods and those that do.

Asked Tues­day how trade talks are far­ing, Trump said sim­ply: “Every­thing’s go­ing well.”

The pres­i­dent has in­di­cat­ed that he will set tar­iff rates giv­en the lo­gis­ti­cal chal­lenge of ne­go­ti­at­ing with so many na­tions. As the 90-day pe­ri­od comes to a close, on­ly the Unit­ed King­dom has signed a trade frame­work with the Trump ad­min­is­tra­tion. In­dia and Viet­nam have sig­naled that they’re close to a trade frame­work.

There is a grow­ing body of ev­i­dence sug­gest­ing that more in­fla­tion could sur­face. The in­vest­ment bank Gold­man Sachs said in a re­port that it ex­pects com­pa­nies to pass along 60% of their tar­iff costs on­to con­sumers. The At­lanta Fed­er­al Re­serve has used its sur­vey of busi­ness­es’ in­fla­tion ex­pec­ta­tions to say that com­pa­nies could on av­er­age pass along rough­ly half their costs from a 10% tar­iff or a 25% tar­iff with­out re­duc­ing con­sumer de­mand.

The JP­Mor­gan­Chase In­sti­tute find­ings sug­gest that the tar­iffs could cause some do­mes­tic man­u­fac­tur­ers to strength­en their roles as sup­pli­ers of goods. But it not­ed that com­pa­nies need to plan for a range of pos­si­ble out­comes and that whole­salers and re­tail­ers al­ready op­er­ate on such low prof­it mar­gins that they might need to spread the tar­iffs costs to their cus­tomers.

The out­look for tar­iffs re­mains high­ly un­cer­tain. Trump had stopped ne­go­ti­a­tions with Cana­da, on­ly to restart them af­ter the coun­try dropped its plan to tax dig­i­tal ser­vices. He sim­i­lar­ly on Mon­day threat­ened more tar­iffs on Japan un­less it buys more rice from the U.S.

Trea­sury Sec­re­tary Scott Bessent said in a Tues­day in­ter­view that the con­ces­sions from the trade talks have im­pressed ca­reer of­fi­cials at the Of­fice of the U.S. Trade Rep­re­sen­ta­tive and oth­er agen­cies.

“Peo­ple who have been at Trea­sury, at Com­merce, at US­TR for 20 years are say­ing that these are deals like they’ve nev­er seen be­fore,” Bessent said on Fox News Chan­nel’s “Fox & Friends.”

The trea­sury sec­re­tary said the Trump ad­min­is­tra­tion plans to dis­cuss the con­tours of trade deals next week, pri­or­i­tiz­ing the tax cuts pack­age passed on Tues­day by the Re­pub­li­can ma­jor­i­ty in the Sen­ate. Trump has set a Fri­day dead­line for pas­sage of the mul­ti­tril­lion-dol­lar pack­age, the costs of which the pres­i­dent hopes to off­set with tar­iff rev­enues.

By JOSH BOAK

WASH­ING­TON (AP)