News Summary
The Federal Reserve Bank of New York’s recent survey indicates that a majority of businesses in New York and northern New Jersey are passing increased tariff costs onto consumers, leading to higher prices for goods and services. Almost 90% of manufacturers and about 75% of service firms reported increased costs due to tariffs, with more than half of those businesses raising prices shortly after the tariff adjustments. The survey sheds light on the economic impact of tariffs and the uncertainty surrounding future tariff changes.
New York – The Federal Reserve Bank of New York has revealed that a significant number of businesses in New York and northern New Jersey are passing increased tariff costs onto consumers, leading to higher prices for goods and services. This information stems from a recent survey conducted between May 2-9, 2025, which sheds light on the economic impact of tariffs on local businesses.
According to the survey, nearly 90% of manufacturers and approximately three-quarters of service firms import goods, with an average of 30% of inputs coming from outside the U.S. Manufacturers reported experiencing an average tariff rate of around 35%, representing a substantial 25 percentage point increase in just six months. Similarly, service firms indicated an average tariff rate of 26%, marking a 17-point rise during the same timeframe.
Furthermore, about 75% of businesses facing tariff-related cost increases in both the manufacturing and service sectors have passed on at least a portion of these increased costs to their customers. Nearly one-third of manufacturers and 45% of service firms reported fully passing on these costs, while 45% of manufacturers and one-third of service firms indicated they only passed along part of the increased expenses. More than half of the firms that chose to raise prices did so within a month of incurring tariff-related cost increases, while a quarter of businesses planning to increase prices aimed to do so within one to three months of the tariff adjustments.
These findings come shortly before a significant reduction in tariffs on China, which was set to drop from 145% to 30% under President Trump’s policy changes. Despite this reduction, many businesses reported a considerable degree of uncertainty regarding future tariffs, with numerous firms anticipating further increases. Specifically, half of the service firms surveyed expected tariffs to rise in the coming months, while about one-third predicted a decrease.
The imposition of tariffs has been disruptive to supply chains, prompting many firms to consider relocating their operations or sourcing inputs from alternative locations to mitigate the impact. Analysts from BD8 Capital Partners have discussed the broader implications of President Trump’s tariff threats, particularly concerning major companies such as Apple and the effects on international trade within the European Union.
In summary, the New York Fed’s survey highlights how businesses are adapting to rising tariffs by adjusting their pricing strategies, ultimately impacting consumers. As operational decisions shift in response to tariffs, the long-term effects on supply chains and pricing remain uncertain, adding to the economic pressures faced by both businesses and consumers.
Deeper Dive: News & Info About This Topic
- The New York Times: Trump Tariffs Court Ruling
- Wikipedia: Tariff
- Fox Business: Consumers Paying Costs of Trump’s Tariffs
- Google Search: Trump tariffs
- CNBC: Inflation Fears Receded in May
- Google Scholar: Tariffs Impact on Economy
- New York Post: World Bank Supports Trump’s Trade Complaints
- Encyclopedia Britannica: Inflation
Author: STAFF HERE NEW YORK WRITER
NEW YORK STAFF WRITER The NEW YORK STAFF WRITER represents the experienced team at HERENewYork.com, your go-to source for actionable local news and information in New York, the five boroughs, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as New York Fashion Week, Macy's Thanksgiving Day Parade, and Tribeca Film Festival. Our coverage extends to key organizations like the Greater New York Chamber of Commerce and United Way of New York, plus leading businesses in finance and media that power the local economy such as JPMorgan Chase, Goldman Sachs, and Bloomberg. As part of the broader HERE network, including HEREBuffalo.com, we provide comprehensive, credible insights into New York's dynamic landscape.
