Donald Trump’s victory in the 2024 presidential elections could bode poorly for IT budgets, the Consumer Technology Association (CTA) has warned.
Trump has floated various tariff proposals on the campaign trail—most notably, a universal tariff of around 10% or 20% on all goods entering the US, as well as adding a 60% tariff on top of all existing tariffs for imports from China. According to an analysis by the CTA, which lobbies on behalf of US tech firms, the result would be a stunning surge in prices.
Laptops and tablets, for example, might cost 57.3% higher than they do under existing tariffs.
Here’s what that CTA analysis looks like for other products (projected increases under existing tariffs are negligible):
- Smart phones and tablets: 57%
- Monitors: 50.7%
- Computer accessories: 23%
- Connected devices: 20.7%
- PCs: 11.3%
That’s not to mention consumer products like video game consoles (62.1%), headphones (39.4%), and TVs (17.5%). The CTA analysis also didn’t account for retaliatory tariffs other nations might impose in response, which could increase prices further.
All told, the proposed tariffs on the ten categories of consumer technology products in the analysis would reduce US consumer spending power by $90 billion per year, according to the CTA.
Ed Brzytwa, VP of international trade at the CTA and former director of APEC affairs at the US Trade Representative’s Office, told IT Brew the CTA has elsewhere estimated the cost of shifting all consumer technology production in China back to the US would “very conservatively” cost at least half a trillion dollars in direct investment. That’s in addition to environmental and energy costs as well as a 10-fold increase in labor.
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Brzytwa has little doubt Trump will find both the legal authority and will to impose unprecedented tariffs on imports.
“I think he will pursue those tariffs, based on what he did in his first term,” Brzytwa said, adding that the CTA takes his claims at “face value” based on the hundreds of billions of dollars in tariffs Trump ordered in his first term.
Economists broadly agree tariffs, which are paid by importers rather than sellers in the country of origin, increase prices. Other groups like the National Retail Federation have released similar projections to CTA’s.
According to Brzytwa, it’s not just that tariffs discourage imports; they’ll fail to encourage domestic manufacturing. Disrupting the supply chain and increasing the cost of doing business so significantly, he said, won’t ensure “all this production magically moves into the United States overnight.”
“Moving these supply chains out of China into other markets or the United States is going to take time, and it’s going to be very costly,” Brzytwa said. “Companies aren’t just going to eat those costs—it’s very likely they’re going to pass those costs on to consumers.”
Brzytwa warned higher prices for IT gear could delay upgrades at enterprises, resulting in lower productivity over time, as well as delay research, product development, and expansion. He also cautioned retaliatory measures by trade partners could cause additional pain.
“The EU is not mincing words, they’re going to retaliate quickly and severely, and we’re going to see China retaliate,” Brzytwa said. “I’m sure many other countries are going to follow suit.”