Import tariffs in 2025 are failing to protect local jobs because they are too messy to actually implement.
April 24, 2026
Original Paper
U.S. Import Tariffs in 2025: Realized Tariff Rates, Import Prices, and Local Labor-Market Effects
SSRN · 6630174
The Takeaway
Realized tariff rates in 2025 were significantly different from the statutory rates announced by the government due to administrative frictions. These implementation gaps meant that the intended economic shock never fully hit the market in the way policymakers planned. As a result, the tariffs had a negligible impact on local unemployment or labor-force participation. Most people assume that an announced tax on imports immediately translates into protection for domestic workers. This research shows that the complexity of global trade makes tariffs a far less effective tool for job creation than usually claimed.
From the abstract
We analyze the effect of the 2025 U.S. import tariffs on import prices and local labor-market using highly disaggregated customs data to construct realized tariff rates from actual duty collections. We document a large and persistent gap between realized and statutory rates, mainly driven implementation frictions. Hence, statutory rates are a poor proxy for the trade shock that firms actually faced. Using realized tariffs, we find that pass-through of realized tariffs into import prices was clos