“U.S. manufacturing activity contracted for the ninth consecutive month in November,” reports the Wall Street Journal. “Tariffs, which have increased costs for sourcing materials, continue to weigh on U.S. producers.”
Rising tariffs made manufacturing shrink, rather than shifting America back to a manufacturing-based economy. “According to the Commerce Department’s latest figures, manufacturing has contributed 9.4 percent of total GDP through August 2025, down from 9.8 percent in 2024,” reported Reason Magazine:
Rather than being helped, the manufacturing sector is being crushed by tariffs, which are increasing the cost of raw materials and intermediate goods. Monthly surveys by the Institute for Supply Management show that overall manufacturing activity has declined for seven consecutive months through September. A separate survey conducted by the Dallas Federal Reserve in August 2025 found that just 2.1 percent of business owners believed the tariffs had a positive impact. “The effect is most widespread in manufacturing, where more than 70 percent of firms noted negative impacts,” the survey reported.
“Some in Trump’s orbit insist that 15 percent of the economy should be manufacturing,” but President Trump’s tariffs have taken us further away from that goal.
Trump’s tariffs bankrupted hundreds of small businesses, by raising tariffs so suddenly that companies couldn’t adjust their purchases or prices, and by imposing a bewildering array of tariffs that varied enormously from product to product and country to country: “After 99 years, Michigan clockmaker Howard Miller is shutting down. The culprit: Trump’s tariffs.” “If the federal government had said, ‘Oh, it’s a 10% tariff, constant,’ … they might’ve worked things out,” an employee said. “But no. It’s just chaos.” “Tariffs dialed up the cost of certain imported products” the clockmaker needed to make its clocks. “The family-owned company was put in a difficult position, said Nelson Vandermeer, a product development engineer.”
Other small businesses are being crushed by the tariffs.
A trade economist explains that tariffs have grown much more complex under Trump. Their complexity
has radically increased in recent years, burdening American businesses along the way. Before Trump’s first term in office, U.S. importers typically reviewed three things when calculating their products’ potential tariff liability: 1) the “general” baseline tariffs set in the U.S. tariff code… 2) “special” exceptions to the baseline rates for a few nations and products subject to preferential arrangements like free trade agreements… and 3) for an even smaller number of products (around 1 percent of all imports, as of 2022), whether any additional duties applied because of U.S. antidumping or countervailing duty measures intended to offset “unfair” foreign trade practices…..they were relatively clear and static—for example, items 1 and 2 are published in the HTSUS for every product, and free online tools let importers determine a product’s detailed tariff code. As a result, even high U.S. tariffs (e.g., on shoes) have long been surmountable by smaller, less sophisticated American businesses, assuming they were willing to pay whatever taxes applied.
The Trump 1.0 and especially Trump 2.0 eras have obliterated this dynamic. During his first term, Trump applied tariffs under three rarely used statutory provisions….During just the first year of Trump’s second term, he’s added even more Section 232 actions (automotive goods, copper, wood, and trucks/buses), another Section 301 action (on ships), and several rounds of tariffs under the International Emergency Economic Powers Act (global “reciprocal” tariffs; fentanyl tariffs for China, Canada, and Mexico; extra punitive tariffs for Brazil and India; and around 10 IEEPA-related trade deals). As of today, 17 different U.S. tariff measures and seven different legal regimes now apply to significant commercial volumes of imports into the United States—up from just three in 2017.
Some small businesses just can’t keep up with this ever-growing complexity.
Tariffs will increase healthcare costs, such as by adding billions in costs for medical goods.
Trump’s tariffs increased the cost of building a home in America by thousands of dollars.
Tariffs on steel wipe out more jobs than they save, because “steel is produced by a tiny sliver of the economy, but used as an input by a much broader swathe of manufacturers,” notes Justin Wolfers, an economist at the University of Michigan.
Steel and aluminum tariffs have a history of wiping out more jobs than they save, by increasing the cost of production for American industries that use steel and aluminum as raw materials to make their products. The steel and aluminum tariffs Trump imposed back in 2018 shrank employment by 74,000 jobs, wiping out more jobs than they saved.
In June, Bloomberg News reported on how tariffs are harming manufacturers in the news article “Trump’s Tariffs Aimed at Reviving Manufacturing Are Doing the Opposite“:
President Donald Trump’s signature trade policy is threatening to backfire by upending other top priorities: the revival of US manufacturing and the American Rust Belt.
In Illinois, Trump’s tariffs prompted a compressor maker to delay a key equipment purchase after an ambitious factory revamp. Rockwell Automation Inc., a Wisconsin-based producer of factory tools, says some manufacturers are putting projects on hold because of uncertainty over costs and future demand. Snap-on Inc. is seeing similar hesitancy among car mechanics.
The warnings underscore the rising worry that turbulence from Trump’s trade wars will smother the progress US manufacturers have already made revving up American factories. Manufacturing payrolls fell by 8,000 last month, the most this year, according to the Bureau of Labor Statistics.
Trump’s so-called “reciprocal” tariffs aren’t reciprocal at all.
