Midsize businesses face $82 billion tariff tab
A message from: JPMorganChase
The current U.S. tariff policy will cost midsize businesses $82.3 billion, according to a new report from the JPMorganChase Institute.
Why it's important: Midsize businesses, often defined as those with annual revenues between $10 million and $1 billion, generate about one-third of U.S. private sector revenue and employment.
- They're an important — yet often overlooked — segment of the economy.
The challenge: Nearly half (48%) of midsize companies import goods. Unlike larger companies, these firms may lack the scale or market power to absorb additional cost burdens or negotiate with suppliers for better prices.
- A companion report finds these businesses are disproportionately exposed to tariff hikes because they rely more heavily on imports from countries facing the highest tariffs.
The impact: Using proprietary data, these JPMorganChase Institute reports reveal how tariffs impact midsize companies, U.S. metro areas and industries under three different policies.
- In both analyses, the estimates consider direct costs to firms that physically import goods and pay import tariffs when goods enter the U.S.
Scenario 1: In February and March, the U.S. government announced tariffs on imports from Canada, China and Mexico. This included a 25% rate on imports from Canada and Mexico and 20% on imports from China.
- Estimated total direct tariff costs: $29.6 billion.
- Average cost per employee: $750.
- Areas near the Mexico border and in the Midwest were most affected.
Scenario 2: On April 2, sweeping tariffs were announced on imports from nearly every country, with rates ranging from 10% to more than 100%. On April 9, some tariffs were paused for 90 days, but a 10% universal import tariff and a 145% tariff on Chinese imports remained in effect.
- Estimated total direct tariff costs: $187.7 billion (a 6x increase from Scenario 1).
- Average cost per employee: $4,740.
- These tariffs hit midsize companies importing from China particularly hard. In 2022, these firms sourced 20.9% of their imported goods from China.
- The Pacific Northwest and Northeast — which saw little exposure in Scenario 1 — were hit hardest this round.
Scenario 3: On June 11, a new tariff rate of 55% on imports from China was announced. As of August 2025, this is still the current policy.
- Estimated total direct tariff costs: $82.3 billion.
- Average cost per employee: $2,080.
Across all three scenarios, midsize wholesalers bear the largest share of direct tariff costs by sector. Because wholesalers may operate on relatively thin margins, these costs could be passed along to their business customers.
The takeaway: These findings from the JPMorganChase Institute illustrate the wide range of direct tariff costs to midsize firms depending on policy outcomes. If paused tariffs go into effect again, they could generate major upfront costs for midsize companies, while the impact may be more modest if future trade deals continue to reduce tariffs.
Looking ahead: Midsize firms will have to consider their options carefully as trade policy evolves. Firms with suppliers in potential high-tariff countries may need to develop contingency plans for a range of outcomes, weighing short-term cost concerns with longer-term strategic considerations.
- Because midsize companies often play a crucial role in regional economies, policymakers should also be aware of how tariffs could impact their local economies and affect tax revenues that fund local government services.