Senate Investigation Reveals Tariffs Impact Michigan Business and Tourism

Tariffs Impact Michigan Business and Tourism as local shops report fewer customers, shorter tourist stays, and growing uncertainty.

Senate Hearing Focuses on How Tariffs Impact Michigan Business and Tourism

LANSING, Mich. — June 20, 2025 — In a tense hearing this week, the Michigan Senate Oversight Committee, chaired by Sen. Sam Singh (D-East Lansing), examined how recent federal trade policies are fueling a local economic slowdown. The session featured stark testimony from small business owners and economic researchers who say tariffs impact Michigan business and tourism in ways that are already being felt in communities from Traverse City to Detroit.

“The impacts of Trump’s reckless and blanket tariffs are sparking fear and uncertainty for Michigan consumers,” Singh said, emphasizing the ripple effect on small retailers. “We’re seeing real damage to confidence and sales. Our state’s economic stability is at stake.”

Consumer Confidence Collapses Under New Trade War Tensions

Dr. Joanne Hsu, director of the University of Michigan’s Surveys of Consumers, shared data showing a sharp drop in consumer sentiment during the first quarter of 2025. After climbing through much of 2024, the index dropped rapidly—marking the second-lowest point since the 1950s.

“This is more than political,” Hsu explained. “Consumers across party lines are feeling uncertain. When tariffs hit, it shakes expectations, especially for big-ticket spending. Even affluent households are pulling back.”

Hsu said nearly two-thirds of consumers surveyed expect unemployment to rise soon, a sign that confidence in job security is also eroding.

Tariffs Impact Michigan Business and Tourism in Border-Trade Regions

Data presented during the hearing showed a 19-fold increase in import duties from Canada between January and April 2025, according to researchers from the MSU Center for Canadian Studies. The Trump administration’s newly reimposed 50% tariffs on steel and aluminum are expected to worsen the burden.

Michigan’s economic ties to Canada are especially vulnerable. Experts warned that these tariffs—targeting key sectors like automotive parts, copper, and raw materials—could threaten tens of thousands of jobs in manufacturing, logistics, and retail.

Nick Nigro, founder of Atlas Public Policy, noted that Michigan’s clean energy and electric vehicle production sectors are also at risk. “Tariffs create bottlenecks in supply chains. If uncertainty continues, investment dries up.”

Northern Michigan Retailers Say Tourism Economy Is “Treading Water”

Karen Roofe, a Traverse City gift shop owner and board member of the Downtown Traverse City Association, testified that her revenue has slipped significantly. “Customers are still coming—but they’re booking shorter stays and spending less,” she said.

Roofe said that tariffs impact Michigan business and tourism by dampening discretionary spending—especially in tourist towns that depend on longer stays, dining, and shopping. “I’ve had to hold off on hiring and cut hours. Everyone’s feeling the pinch,” she added.

Lawmakers Pledge Further Hearings as Uncertainty Grows

Sen. Singh and other Democratic lawmakers said this was one of several scheduled oversight hearings to examine how federal economic decisions are affecting Michigan households. While tariffs are federally imposed, Singh noted the state has tools—such as targeted relief and small business loan expansion—to blunt the worst effects.

Hsu concluded by warning the committee, “Tariff uncertainty is becoming the new norm. Unless clarity is restored, consumer and business sentiment may continue to deteriorate.”

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