They cost $9,000 a second. Every second of every hour of every day.
That’s what the U.S. Chamber of Commerce says Trump administration tariffs of 10% to 145% are currently costing American small businesses. Annualized, that’s almost $284 billion a year.
And according to economists and small business operators here and across the state, that’s a dagger aimed straight at the heart of a sector that employs almost half of all working South Carolinians.
“Small businesses don’t have the flexibility or financial resources that larger businesses do,” University of South Carolina economist Joseph Von Nessen told the Charleston City Paper this week. “So they’re more likely to have to pass higher costs onto consumers, which hurts demand for their products and services.”
Another difference, Von Nessen noted, is that small businesses don’t have the same ability to lobby federal officials for tariff delays, waivers and exemptions, such as those awarded to U.S. automakers in an April 29 executive order.
“They just don’t have the capacity to negotiate [with government leaders] the way that large businesses might,” Von Nessen said. “So again, you’re in a scenario where they have to absorb the changes as they come.”
In short, South Carolina small businesses are facing big tax increases in the form of tariffs that they can’t absorb or avoid. And that means higher prices and fewer choices for Palmetto State consumers — and a harder economic road for the small business owners who serve them.
‘I just can’t take on all that risk’
Since 2009, Charleston’s Dan Einhorn has seen his Bilda Bike business grow from a backyard hobby to a regional powerhouse, with a 10,000-square-foot headquarters and retail locations in Charleston and North Charleston.
Key to that success has been the explosion of international trade and commerce, which allowed Einhorn to design and custom-manufacture his own line of affordable, corrosion-resistant bikes that can stand up to Charleston’s wet and salty environment.
While Einhorn says he supports the goal of supporting U.S. manufacturing, he told the City Paper that tariffs have already forced him to transition away from custom manufacturing and back toward selling off-the-shelf brands that are already in U.S. warehouses.
The irony? More than 90% of those major brand bikes are imported, too.
“It makes me a little sad,” Einhorn said. “I have a history of selling these products. People like them, and I deliver them at a good price with good quality. But I just can’t take on all that risk right now.”
But even more concerning to Einhorn is the coming buying season, now just around the corner.
“We have to get things in order for next spring but what does that even look like?” Einhorn said.
“What if you order something, but by the time the goods have shipped, the tariffs have changed? That would be incredibly challenging.”
How realistic is the goal?
Like Einhorn, Jon Lessans of Indigo Ink Marketing in West Ashley says he supports the goal of making sure that American manufacturers can compete and win in international markets.
But he, too, is already feeling the bite of tariffs, particularly on custom-branded swag — think everything from shirts and hats to knapsacks and more — that his clients rely on him to provide for their businesses.
In fact, he just had to eat a significant tariff cost out of his own pocket to keep a client project moving forward.
“Usually a quote is good for 30 days, sometimes even 90,” he said. “And because of the crazy up-and-down tariffs, I wound up losing quite a bit on that one.”
What’s more, he says he wonders what it would actually mean to move production of the kinds of items he sells back to the U.S., where labor costs are so much higher.
“Would most of it just become automated anyway?” he asked.
Interestingly, that’s an issue Vice President J.D. Vance may have inadvertently raised with his May 1 visit to Nucor Steel in Huger, where he promised an “industrial renaissance” thanks to the administration’s punishing tariffs on imports.
But the production and employment numbers on U.S. steel over the past generation may answer Lessans’s question. At the industry’s height in 1973, America’s steel companies needed almost 600,000 workers to produce 110 million tons of steel. Today, they produce almost 75 million tons with just 85,000 workers.
In other words, experts say, even if U.S. steel manufacturers once again reached their zenith of 110 million tons, they’d only employ about 125,000 Americans — far fewer than the number currently working in the legal cannabis business.
‘Small businesses can’t do any of that’
S.C. Small Business Chamber of Commerce President Frank Knapp says his members are already feeling the effects of high Trump tariffs — and that unlike the major corporations that have dominated the headlines, their hands are mostly tied.
“Big businesses can find new sources, make special deals and stockpile inventory before tariffs take effect,” Knapp said. “Small businesses can’t do any of that.”
And the few options they do have, he says, are bad for consumers and businesses.
“Tariffs are a tax,” Knapp said. “They have to either pass it along or eat it.”
But what Knapp says he’s most concerned about right now is President Donald Trump’s recent suggestion that small businesses aren’t being negatively impacted by his tariffs.
“They’re not going to need it,” Trump said on May 4’s Meet the Press, when asked if he would consider giving small businesses tariff relief. “They’re going to make so much money.”
Knapp said the answer “showed his feelings” about small business.
“The attitude of the president of the United States is just appalling,” Knapp said. “How hard would it have been to show a little compassion to small businesses?”
But in Knapp’s view, the president is unlikely to change course.
“Everything’s always fine — until it’s not,” Knapp said. “But by then, he’s already on to the next thing.”
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