Tariff costs for midsize US firms have tripled, analysis shows

Tariffs paid by midsize U.S. businesses tripled over the course of last year, new research tied to one of America’s leading banks showed on Thursday—more evidence that President Donald Trump ‘s push to charge higher taxes on imports is causing economic disruption.

The additional taxes have meant that companies that employ a combined 48 million people in the U.S.—the kinds of businesses that Trump had promised to revive—have had to find ways to absorb the new expense, by passing it along to customers in the form of higher prices, employing fewer workers or accepting lower profits.

“That’s a big change in their cost of doing business,” says Chi Mac, business research director of the JPMorganChase Institute, which published the analysis. “We also see some indications that they may be shifting away from transacting with China and maybe toward some other regions in Asia.”

The research doesn’t say how the additional costs are flowing through the economy, but it indicates that tariffs are being paid by U.S. firms. It’s part of a growing body of economic analyses that counter the administration’s claims that foreigners pay the tariffs.

The JPMorganChase Institute report used payments data to look at businesses that might lack the pricing power of large multinational companies to offset tariffs, but may be small enough to quickly change supply chains to minimize exposure to the tax increases. The companies tended to have revenues between $10 million and $1 billion with fewer than 500 employees, a category known as “middle market.”

The analysis suggests that the Trump administration’s goal of becoming less directly reliant on Chinese manufacturers has been occurring. Payments to China by these companies were 20% below their October 2024 levels, but it’s unclear whether that means China is simply routing its goods through other countries or if supply chains have moved.

The authors of the analysis emphasized in an interview that companies are still adjusting to the tariffs and said they plan to continue studying the issue.

The White House did not immediately respond to questions about the analysis.

Read the full story from The Associated Press.