Although the tariffs were originally billed as a negotiating tactic, talks between the U.S. and China have so far failed to make much progress. The recent tariff hike kicked in as part of a second round of tariff raises that weren’t supposed to be necessary, as the President had bet that China would renegotiate in the face of mounting pressure. That didn’t happen, and now tariffs are again going up.
That’s worrisome for almost everyone, and some have interpreted it as a sign that the tariffs could become a permanent feature of U.S. trade policy. That, in turn, could push the economy in unexpected directions, so the U.S. manufacturing industry — and, by extension, businesses around the world — waits with bated breath to see what the next round of negotiations will bring.
Especially in today’s uncertain political and economic climate, it’s hard to know what the final impact of tariffs will be on America’s manufacturers. Some may derive long-term benefit from their protectionism, while many others will have to contend with higher costs and slower growth. Either way, almost all businesses must prepare for the possibility that tariffs are here to stay and make the technological and process improvements that will enable them to remain competitive.