How Upcoming Tariffs Could Raise Prices on Sneakers, Jeans, and Your Favorite Apparel: What You Need to Know

NEW YORK (AP) — As kids head back to school, families might be in for a surprise. School shopping for new shoes and clothes could cost a lot more this year. Industry groups warn that upcoming tariffs on imports will impact prices significantly.

Most of the clothing and footwear we buy—about 97%—comes from overseas, mainly from Asia. Big names like Walmart, Gap, Lululemon, and Nike source most of their products from these regions.

Under the new tariff plan, imports from China will face at least a 54% tax. Meanwhile, products from Vietnam and Cambodia will see steep increases of 46% and 49%, respectively. Even countries like Bangladesh and Indonesia will have higher tariffs, making it harder for U.S. companies to find affordable alternatives.

Steve Lamar, president of the American Apparel & Footwear Association, emphasized that these costs won’t be absorbed by manufacturers. “If these tariffs persist, consumers will feel the pinch,” he said.

The Footwear Distributors and Retailers of America recently estimated that the price of shoes could soar. For instance, a pair of work boots made in China that currently sells for $77 might jump to $115. Running shoes from Vietnam could increase from $155 to $220. Families with tighter budgets will likely be hit the hardest. A pair of children’s shoes now costing $26 could rise to $41 by back-to-school season, according to their projections.

The trade tensions have already altered the landscape for U.S. retailers. Before Trump’s presidency, many companies began shifting production away from China due to trade concerns and human rights issues. Following the tariffs imposed in 2018, this trend grew, with Lululemon reporting 40% of its sportswear is now made in Vietnam and other countries.

Despite these efforts, experts argue that reviving the American garment industry would be costly and time-consuming. In 2015, the U.S. had 139,000 apparel manufacturing jobs; by early 2022, that number dropped to just 85,000, according to the Bureau of Labor Statistics. In contrast, countries like Sri Lanka have significantly more garment workers, despite having a smaller population.

Moreover, the U.S. lacks domestic sources for over 70 materials needed to make shoes. Factories would need to be established to produce laces, eyelets, and other components locally, a challenging endeavor.

Consumers may soon notice rising prices after decades of relative stability. Over the past 30 years, clothing prices in the U.S. have remained largely the same. Experts attribute this to free trade agreements and competition among retailers. However, with inflation affecting many sectors, including groceries and housing, people might be more sensitive to price hikes in clothing.

Matt Priest from the Footwear Distributors and Retailers of America noted that shoppers seem nervous. Many have cut back on shoe spending, reflecting their concerns about prices.

A recent report by Barclays highlighted the winners and losers in this ongoing trade situation. Retailers with strong negotiating power and limited exposure to Asia, such as Burlington and Ross Stores, may weather the storm better. On the other hand, companies like Gap Inc. and Urban Outfitters, which depend heavily on imports, face tougher challenges.

Interestingly, secondhand clothing sites like ThredUp could benefit from this shift. They applauded recent tariff changes aimed at reducing the flow of cheap, imported goods that often lead to overproduction and environmental issues.

Economists have warned that these tariffs may act as a hidden tax for consumers, deepening the gap between America’s wealthiest and those with lower incomes. Mary E. Lovely, an economist at the Peterson Institute, raised a provocative question about the future of U.S. apparel: “Will we have to start knitting our own clothes?”

As families gear up for a new school year, the cost of dressing their kids might just be the tipping point in their back-to-school budgeting plans. For more insights into apparel pricing and tariffs, check out the research from the American Apparel & Footwear Association.

Check out this related article: Could Mississippi and Kentucky Be the First States in Over 40 Years to Eliminate Personal Income Taxes?

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