Minnesota small businesses face economic uncertainty from new tariff rates

In the weeks leading up to July 2025, Minnesota small businesses are bracing for the impact of impending tariff rates that are set to take effect next month. Interviews with local business owners and trade law experts paint a picture of rising concern over how these changes may affect their operations. Specifically, businesses rely heavily on imports from Canada, Mexico, and China, and the tariffs could disrupt their ability to get necessary materials and resources. Paul Vaaler, a trade law professor at the University of Minnesota, stated that even a short-term tariff ban could drastically change conditions for businesses, with impacts being felt almost immediately. He emphasized the importance of monitoring small business responses, particularly their financial health, as many lack the capital to withstand prolonged economic strain. The situation varies among businesses, with those dependent on imported metals and energy sources facing the largest risks. Vaaler pointed out the uncertainty posed by tariffs, which can create heightened stress for small business owners who may not have the financial margins to cope with sudden price increases or the inability to access supplies. While Minnesota’s economy is generally robust due to the presence of numerous Fortune 500 companies, the fate of smaller enterprises remains precarious. The worst-case scenario, as warned by experts, could include significant bankruptcies within the sector, while the best-case scenario involves threats of tariffs that do not fully materialize. Local businesses and economic analysts are watching the situation closely, looking for signs of how these tariffs will reshape Minnesota’s business landscape.