Tariff pain is already hitting local communities hard
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Growth is slowing, inflation is creeping up, fears of a crippling 1970s-style stagflation are rising — and against that tough national backdrop, local communities are starting to feel the economic fallout from President Trump's trade policy.
Why it matters: It might be too granular to sway large national data sets, but border cities across North America are already feeling the trade war pain that could strain their budgets and threaten the broader U.S. economy.
Zoom out: Nearly two dozen local government officials from U.S., Mexican and Canadian cities were in Washington, D.C. on Friday — just blocks away from the White House — ahead of April 2, what one mayor told reporters was their "D-Day."
- Daniel Rickenmann, the mayor of Columbia, S.C., told reporters Sonoco, the packaging giant based in the state, is dealing with higher aluminum prices.
- Steelmaker Cleveland-Cliffs cut 1,200 jobs at plants in Michigan and Minnesota as tariffs hit demand.
What they're saying: "We are already hearing anecdotes from businesses being impacted by the uncertainty related to supply chains," Ron Nirenberg, the mayor of San Antonio, Texas, told Axios.
- "We're an international city with local businesses that are essentially borderless," he said, but now there is "a lot of confusion about what the North American trade corridor actually is at this point."
Zoom out: "Municipalities are on the front line of this economic downturn that is hitting our country when it is already at its most vulnerable," Rebecca Bly, a member of Vancouver City Council, told reporters after the summit hosted by the United States Conference of Mayors.
- "No place is an economic recession felt more than in each and every one of our municipalities," Daniel Serrano, mayor of Cuautitlán Izcalli, a city in Mexico home to a Ford assembly plant, said.
Zoom in: At times, the White House's reasoning for tariffs — trade deficits, lost manufacturing jobs and more — contradicts the microeconomic backdrop.
- San Antonio — where the North America Free Trade agreement was signed in 1992 — has a trade surplus with Mexico, the destination for over half of its exports in 2024.
- Trump claims tariffs will revive a U.S. manufacturing sector that has seen employment plunge over the last four decades, but officials like Nirenberg say the levies will destroy a local boom underway.
- In the San Antonio metro area, manufacturing employment most recently peaked in October after a pandemic surge.
The bottom line: Local politicians are often the first to see economic conditions shift.
Editor's Note: This story has been updated with additional details on national economic conditions.
