BY TIARA BROWNIE | Higher prices for consumers and lower profit margins for retailers: That’s the harsh economic reality once a tariff has been put in place. But when wielded by President Donald Trump as a means to bring other countries to the negotiating table, the looming threat of a tariff comes with its own unwelcome consequences.

“They are creating a lot of uncertainty. It’s driving up the cost of goods and fabrics for both business owners and consumers,” says Jessica Walker, President and CEO of the Manhattan Chamber of Commerce (MCC). “We think it’s a terrible policy. We have been trying to get them reversed. We’ve also been trying to pursue different exemptions for small businesses, which I do think that many of the businesses in the Garment District are qualified for,” said Walker during a May 10, 2025 online interview with Chelsea Community News (CCNews).

Tariffs, especially those from major exporters like China and South Korea, have a substantial impact on the garment industry by disrupting supply chains and forcing businesses to rethink their sourcing strategies, potentially leading to a transfer of manufacturing to other countries or a reliance on more expensive domestic suppliers. 

On April 2, 2025 (“Liberation Day”), President Trump imposed a minimum 10% tariff on all U.S. imports, starting a worldwide trade war. As it intensified, he put 145% duties on Chinese goods. China retaliated by taxing U.S. imports 125%. President Trump says that tariffs will safeguard jobs and boost American manufacturing–but the global economic chaos is expected to raise costs as business owners pay more for foreign goods they import for sale in the U.S.

New York City’s Garment District relies heavily on imported textiles. China, India, and Vietnam supply 97% of U.S. clothing and shoes, according to the American Apparel and Footwear Association. These countries are significant textile manufacturers, and their fabrics are imported to the United States, particularly the Garment District.

In the next few months unless something change,s policy-wise, “These tariffs will likely affect the upcoming holiday season as many items will cost more for consumers,” says Walker. 

The Manhattan Chamber of Commerce is making every effort to support business owners in surviving the tariff storm. They have been actively engaged in advocating for businesses affected by tariffs and providing resources to help them navigate these challenges.

One such resource is the webinar  “Tariff Response Support: Supply Chain Management Practices for Building Resiliency,” held on the afternoon of July 10. It featured, recalled Walker, “experts to help business owners remedy their supply chains. If, for whatever reason, things have gotten too expensive, or it just had different difficulties because of the tariffs.”

Giacomo Sant’Angelo, Ph.D., a Senior Lecturer in the Department of Economics at Fordham University, discussed significant economic policy shifts. “Businesses need to build adaptive capabilities rather than optimizing for specific policy scenarios,” said Sant’Angelo, adding, “Those companies that were able to transition within 30 days, from Liberation Day to the end of the first month, didn’t do that from the ground up. They did that fully expecting that something like this was going to happen because of their expectations coming into this.”

Sant’Angelo says that to remain viable amid tariffs, business owners should concentrate on progressive enterprises that are investigating collaborative procurement for non-competitive inputs, shared technology platforms for supply chain management, and coordinated strategies for alternative supplier development; these elements are crucial. The underlying economic rationale is quite simple: Regional collaboration can diminish individual business expenses while enhancing the collective resilience previously discussed.

“It’s about talking to the customers and saying, look, this is where we are. This is who we are. This is why we’re struggling,” says Sant’Angelo.

Additionally, he states that the Federal Reserve and the U.S. Trade Representative  believe there are four key issues that businesses should be asking: What proportion of my inputs come from imports? How soon can I modify my pricing strategy to account for volatility? Are there any other vendors I can rely on for my essential components? And can I plan and modify my system to implement a methodical change in ninety days? “The businesses that are doing this will thus come out stronger when we examine this, says Sant’Angelo. “So, what we need to do is quantify and understand what the actual import dependencies are.”

Although the implementation of long-term survival strategies may empower businesses, Walker says the industry as a whole is still being held in a state of limbo as a direct consequence of a tariff’s looming threat. “The biggest impact in the short term will be higher costs. The uncertainty of the tariffs is part of what’s driving job stagnation in the city,” says Walker.