Tariffs almost feel like a buzzword these days, with changes happening across the globe it seems like daily. While they might feel unfamiliar to many of us, the truth is that tariffs have been around for centuries. While tariffs are not a new concept, they are making headlines and raising questions like:

• What are tariffs, and how do they work?
• How will tariffs affect the country?
• How could tariffs impact me and my family?

For those considering (or already working) careers in manufacturing, tariffs might feel especially relevant. Manufacturing is based entirely on the production of goods, and therefore, is a key driver of our economy. Tariffs work to protect the nation’s economy, promoting domestic manufacturing and increasing demand for locally-made products. At the same time, tariffs can also increase costs for manufacturers who rely on imported goods.

So, the question becomes: How do tariffs impact manufacturing, and will changes in tariffs help or hurt manufacturing jobs?

Let’s explore some of these questions in more depth.

What are tariffs?

Tariffs are taxes that the government imposes on imported or foreign-made goods. These taxes are paid by the importer to the home country’s government. In simplest terms, tariffs are an extra cost that the government adds to foreign products as they enter the country. They are a key tool in international trade policies and serve several purposes in today’s economic and political landscape.

How do tariffs work?

Tariffs are enacted at the federal level and imposed on foreign goods.

Typically, tariffs are “ad valorem,” or a fixed percentage of a product’s value — for example, 10% of imported goods’ cost. There are other types of tariffs, such as specific amounts on each item (e.g. $2 per unit) or costs that kick in after importing a certain quota. However, these are generally less common.

To put this into perspective: Let’s say the United States places a 10% tariff on materials imported from another country, like Canada. A $100 shipment of steel from Canada would cost a total of $110 to import, due to the incremental tax. The cost of the goods ($100) would be paid to the Canadian supplier, and the tariff ($10) would be paid to the U.S. government by the importer.

How tariffs could help manufacturing

Tariffs are not new, and as mentioned, can be an important tool in a country’s trade policy. There are many reasons why governments implement and impose tariffs. In addition to bringing in more government revenue, tariffs also help to:

• Protect domestic industries, reducing foreign competition and encouraging the consumption of domestically-made goods
• Correct imbalances in foreign trade, or trade deficits (this happens when a country is importing more goods than it is exporting)
• Negotiate foreign trade, with tariff costs being leveraged to encourage other countries to adjust their policies or behaviors

Specific to the manufacturing industry, tariffs also have the potential to bring certain benefits. Of course, this all depends on how the tariffs are implemented and how other countries respond to them.

If you are considering or working a job in manufacturing, you might be wondering how tariffs could impact you. Here are some of the potential advantages to consider:

Tariffs can protect domestic production.

Tariffs reduce foreign competition and increase the need for domestic goods. Typically, this is good news for manufacturers: The demand for locally-made goods widens as imported goods become less prevalent (and more expensive).

Tariffs can create more manufacturing jobs.

When the demand for domestic goods increases, so does the need to hire more workers. Manufacturing jobs could become available as more processes and materials are brought back to a country (vs. that country relying on foreign trade).

Tariffs might encourage companies to invest and grow.

Similarly, as the demand for domestic manufacturing grows, companies will likely grow with it. In addition to hiring workers to do existing tasks, this might also mean investing in new talent and training to carry out more advanced capabilities, operate new technology, bring more operations in-house, and expand plants beyond their existing location, all to meet the production demand.

Learn about the manufacturing career pathway here.

How tariffs could hurt manufacturing

Just as tariffs have potential benefits, they also come with potential risks. Countries that impose tariffs, for example, might experience backlash and resistance from previous foreign trade partners. Specific to manufacturing, tariffs can result in higher costs for companies that previously relied on imported materials or goods.

Let’s explore the negative impact tariffs might have on a nation’s manufacturing industry, as well as the employees within it.

Tariffs could cause reciprocation from other countries.

Tariffs have the potential to trigger something called “trade wars,” resulting in higher costs for all parties involved. A country that’s affected by imposed tariffs might respond with its own, exponential tariffs. This, in turn, would hurt domestic companies that sell their goods overseas, as they’d be the ones paying the tariff costs.

Tariffs could raise costs for domestic manufacturers.

Although a primary goal of tariffs is to bring manufacturing “home” and increase the demand for domestic goods, even domestic manufacturers could take a hit. This is because many domestic manufacturers still rely on imported materials (like raw steel or certain car parts) to produce their goods. As tariffs on these imports rise, so do the total production costs.

Tariffs could reduce consumer demand for products.

If manufacturing companies are forced to raise their prices for finished goods (due to the factors above), consumers may start to purchase less. This would mostly affect manufacturers that rely on imported goods, shrinking overall demand for their products and in turn affecting their production levels and team.

The future of manufacturing jobs

At the end of the day, tariffs come with both benefits and risks for the manufacturing industry. On one hand, tariffs can safeguard and grow manufacturing jobs, as the need for locally-made goods increases. On the flip side, though, tariffs can raise production costs for manufacturers, which are often passed to consumers.

In short, the impact of tariffs on manufacturing is difficult to predict or define universally. Right now, however, let’s consider what we do know about the future of manufacturing jobs:

• Earnings for manufacturing employees are high. Did you know that the average manufacturing worker in the U.S. earns six figures annually? The average salary in 2023 was $102,629, according to data from the National Association of Manufacturing (NAM).
• There is still high demand for manufacturing employees. New data shows that in March 2025 alone, there were almost 450,000 manufacturing job openings available across the U.S. Companies express preference towards candidates who have training and education under their belts, as these individuals bring a bigger impact and require a lower investment in job training and onboarding.
• The need for manufacturing workers will continue to grow. Experts predict that, by the year 2033, 3.8 million manufacturing jobs will need to be filled, due to baby boomers retiring as well as overall industry growth. The NAM, however, expresses that there’s a shortage of workers to fill these positions. An estimated 1.9 million jobs will go unfilled, they predict, unless we have qualified people to fill them. The next generation of modern manufacturing professionals is needed, and soon.

If you are passionate about a forward-thinking, cutting-edge career, consider the growing field of manufacturing. While the impact of tariffs varies, we know that as a key contributor to the nation’s success, manufacturing is here to stay — workers are needed more than ever.

Learn about Goodwin’s manufacturing programs to develop and future-proof the skills needed to thrive in this industry.