A big part of President Donald Trump’s most recent presidential campaign was the implementation of tariffs. And in April, he imposed a 10% tariff on all goods entering the U.S. He also placed reciprocal tariffs on dozens of other countries.
The goal of tariffs is to prevent trade partners from taking advantage of the U.S. and protect domestic companies that produce and manufacture goods. Tariffs are also supposed to serve as a means of generating revenue for the U.S. government.
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Many consumers and lawmakers alike feared that Trump’s tariff policies would drive up costs for everyday Americans. In December of 2024, Trump told The Associated Press, “I can’t guarantee anything" in the context of tariff-related price increases. (1)
But during a post-inaugural rally in January, Trump doubled down on his stance that tariffs are a positive thing for the U.S. economy, stating, "Tariffs are going to make us rich as hell. It’s going to bring our country’s businesses back that left us." (2) And in a May Meet the Press interview, Trump stated, "The tariffs are going to make us rich. We’re going to be a very rich country." (3)
But as CNBC recently reported, data from S&P Global finds that tariffs will cost global businesses over $1.2 trillion this year alone, with the majority of that cost being passed along to individual consumers. (4) So while the goal of tariffs may be to make the U.S. richer, on an individual level, they may be having the opposite effect.
Tariffs are hurting American consumers
U.S. consumers are bearing 55% of the cost burden of tariffs already, according to recent Goldman Sachs data reported by NBC News (5). S&P Global, meanwhile, says that only about one-third of Trump’s tariffs will be covered by companies, with the rest of the cost burden falling onto consumers. And that’s a conservative estimate.
Unfortunately, these tariffs are coming at a time when consumers are already feeling the pain of inflation. In September, the cost of goods and services was up 3.0% on a year-over-year basis, according to the latest U.S. Bureau of Labor Statistics’ Consumer Price Index.
A late September Ipsos poll found that 48% of Americans have no money left over after paying their bills each month. (6) A separate Axios survey from early September found that 47% of Americans say groceries are costing them more than a year ago. (7)
While some companies and retailers may be trying to shield consumers from the impact of tariffs, many aren’t equipped to do so. A July Reuters analysis found that 21% of U.S. companies have implemented price hikes as a result of tariffs, while 44% have taken a financial hit. (8)
Those 44%, however, risk having to lay off staff to cope with the tariff situation. So that’s yet another way consumers may be impacted by tariffs individually.
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How consumers can manage the impact of tariffs
If you’ve been struggling to cover your costs, you may be hurting especially now that tariffs are starting to drive prices upward. The first thing you should do if you’re worried about covering your bills is get onto a budget. This should help you track your spending and allocate funds to your most important expenses.
The next best thing to do is try to boost your income, if possible. There may only be so much cutting you can do in your budget. But if you’re able to pick up a side hustle and boost your earnings, that could make it easier to cope with higher costs.
Self Financial reports that 45% of Americans have a side hustle. And among those who work an extra gig, 34.2% do so because they rely on the money to cover basic costs. (9)
At a time like this, if money is tight, another good thing to do is to try to limit your purchases to essential items only. And then shop around to compare prices when you’re buying things you need. You might consider secondhand for certain items, like kids clothes and toys, to save on costs.
Another way to cope with tariffs is to try to buy American-made products. Walmart, for example, says that more than two-thirds of its products are made, grown or assembled in the U.S. (10)
It pays to research retailers to see where they source their products from, as that may help you avoid tariff-related increases to some degree. But do keep in mind that many U.S. businesses are bearing the brunt of tariffs and raising prices accordingly, so this strategy may or may not work.
If your budget allows for it, stocking up on certain essentials in bulk could also help you lower your costs. You don’t necessarily have to pay for a warehouse club membership to buy in bulk. Many supermarkets and big-box stores carry bulk items, and you can shop online at sites like Amazon for them, too.
Finally, you may want to turn to discount stores and grocers to stock up on the items you need. And if you have a dollar store near you, it may be a good place to buy non-perishables and household items.
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Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
The Associated Press (1); Roll Call (2); NBC News (3), (5); CNBC (4); Ipsos (6); Axios (7); Reuters (8); Self Financial (9); Walmart (10)
This article originally appeared on Moneywise.com under the title: Tariffs to cost global businesses $1.2T this year — with consumers shouldering brunt of it. How you can fight cost creep
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.