Nearly a month has passed since President Donald Trump announced sweeping tariffs on, well, basically everything the US imports from everywhere.
Apart from financial market gyrations, most of the real-world effects have remained comparatively muted thus far.
That delay is all thanks to the nature of ocean freight shipping times, which can take 20 to 45 days to cross the Pacific.
In particular, orders from Chinese suppliers that were canceled on or after Trump announced the new trade policy are just now starting to be felt in the US.
“We’re starting to see this on the West Coast, and we’re expecting this to continually get worse,” Michigan State University professor and supply chain researcher Jason Miller told Business Insider.
In recent weeks, executives from major retailers, including Walmart, Target, and Home Depot, reportedly warned Trump that US shoppers could start to see empty shelves across the country in the coming weeks if his policies continue.
In a cabinet meeting Wednesday, Trump acknowledged that his policies could reduce shoppers’ choices later this year.
“Maybe the children will have two dolls instead of 30 dolls,” he said. “And maybe the two dolls will cost a couple of bucks more than they would normally.”
Whether faced with sharp price increases or outright product shortages, trade experts say US shoppers are likely to face some difficult realities starting this summer.
Here are seven charts that might be noteworthy on their own, but together, they raise alarms about the consumer economy.
GDP shrank for the first time in three years
Data released Wednesday from the Bureau of Economic Analysis showed a critical dip in US GDP, ending 11 straight quarters of growth and sparking renewed concerns of a recession. It’s worth noting that the first quarter ended before the trade war was officially announced on April 2, still, the number was shaped by business expectations, specifically anticipation of new import costs.
Related stories
Business Insider tells the innovative stories you want to know
Business Insider tells the innovative stories you want to know
That decline came from companies pulling import orders forward
The biggest factor that weighed on GDP last quarter was a ballooning trade deficit from rushed imports. Companies largely knew that some form of tariffs were coming with the election of Trump, and many ordered inventories ahead of time.
Still, ordering a bunch of stuff ahead of schedule comes with its own set of expenses and logistical challenges, and it could leave retailers and suppliers on the hook if consumer spending falters.
Cargo volumes are down significantly — especially from China to the US
Containerized cargo is generally measured in twenty-foot equivalent units, or TEUs, and the numbers have dropped precipitously this week. Some carriers have reported transpacific bookings falling by 30% or more, largely out of China.
A Port of Los Angeles spokesperson told BI that arrivals will slightly increase after next week as more imports come in from countries other than China. Many of these countries are looking to beat the deadline of Trump’s pause on so-called “reciprocal” tariffs.
But MSU’s Miller said the lift will most likely be temporary.
“Any type of rushing stuff to the US from everywhere else cannot fully counterbalance the loss of Chinese volume,” he said.
Instead, the US is receiving more empty containers
Blank sailings are ships that carry empty containers to ports where they will be filled with exports. Normally, the Port of LA sees about a half dozen blank sailings a month, except once a year following the Lunar New Year holiday in China.
The port says it expects to receive 17 and 12 blank sailings in May and June, respectively, and estimates the combined capacity loss to be 350,000 TEUs.
Policy uncertainty is at its highest since early in the COVID-19 pandemic
Hardly anyone — from the White House to Wall Street to Main Street — seems to have a coherent picture of what Trump’s goals are with his trade policy.
One result of this lack of clarity is elevated levels of policy uncertainty that last peaked in the early months of the COVID-19 pandemic. Americans are historically pretty capable of managing both good news and bad news, but uncertainty tends to lead households and businesses to lock down spending, cut investments, and take a defensive stance.
Small business optimism is in the pits …
Large firms aren’t exactly excited about the trade situation, but many have repeatedly said over the past six months that they are well-equipped to deal with whatever is thrown their way.
Smaller companies, meanwhile, are often more dependent on China and don’t have the physical or capital capacity to avoid incurring tariff charges. Nor do smaller companies typically have the purchasing power to ask overseas suppliers for discounts to offset import costs.
“Oftentimes, when businesses and consumers are concerned about the future because of uncertainty, they will stop their activity,” Dana Peterson, chief economist at The Conference Board, previously told Business Insider. “Businesses won’t invest or they won’t hire, consumers won’t spend, they’ll just kind of sit there and wait and see what happens.”
… as is consumer sentiment
Like small businesses, US consumers are not feeling great about the economy.
University of Michigan’s consumer sentiment index took another nosedive in April to 52.2, down nearly 20 points from the start of the year. The last time the number was this low was the summer of 2022, when inflation was at its peak of more than 9%.
Of course, low sentiment and high prices didn’t appear to slow consumer spending all that much back then, but it’s not clear that shoppers will show such resilience this time around.
Even if the White House changes course, Miller said the price impacts and product shortages will start rippling across the US as tariffed inventory works its way through the supply chain.
“A lot of the pricing impacts from this are not going to be felt until the summer,” he said. “You’re going to start seeing the toasters with the 145% tariff probably hitting the shelves in late May, early June.”
