"Almost half of U.S. small businesses, 42%, have experienced rising costs due to tariffs over the past year, calling it a primary financial challenge, according to a Federal Reserve survey published this week. In some critical sectors, that figure surges well past the halfway mark, with 69% of retail firms, 62% of manufacturers, 61% of leisure and hospitality firms, and 56% of healthcare and education firms reporting that tariffs have squeezed their bottom lines."
"There are more than 36 million small businesses operating in the U.S., accounting for 46% of all private sector employment, according to the U.S. Small Business Administration. That's over 62 million people. In the three years after the pandemic, small firms led the U.S. in hiring, accounting for 53% of new job creation during that time. In 2025, it looks like the money they were reserving for hiring new workers has gone to paying the cost of Trump's tariffs instead."
"The Fed survey, which tracked more than 6,500 responses from businesses with fewer than 500 employees nationwide, found that 76% of companies experiencing higher foreign input costs have passed at least some of those increases directly to consumers."
Federal Reserve survey data reveals that tariffs have primarily burdened U.S. small businesses and consumers, contradicting claims that foreign countries would bear the costs. Nearly half of American small businesses report rising tariff-related costs, with higher percentages in retail (69%), manufacturing (62%), leisure and hospitality (61%), and healthcare/education (56%) sectors. Small businesses, which employ 46% of the private workforce and led job creation post-pandemic, now face reduced hiring capacity as resources shift to covering tariff expenses. The survey of over 6,500 small businesses found that 76% of companies experiencing higher foreign input costs have passed increases directly to consumers, effectively spreading tariff burdens throughout the economy.
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