By Anthony Birritteri, Editor-in-Chief On Apr 9, 2025
With the slew of foreign trade tariffs introduced by President Donald Trump last week now reduced to just 10% for a 90-day period for most countries – and top administration officials saying more than 75 countries want to negotiate fairer trade deals while the trade war with China only intensifies – it is difficult for anyone to predict what the short- and long-term fallout of this economic roller coaster ride will be.
Rutgers University Dean Emeritus and economist Jim Hughes, always one to use a humorous phrase to describe an economic situation, says this is an “in again, out again, Finnegan” situation; a phrase used to describe a basketball that loops around the hoop and is both in and out of the basket.
“Things are changing on a daily basis … we should be used to this by now,” Hughes tells New Jersey Business Magazine. “We really have no idea what the tariffs could be next week compared to today, and that certainly makes forecasting extraordinarily hazardous.”
What Hughes already has seen because of the tariff debacle is declining consumer confidence, driven by a volatile stock market and expected inflation, which will have a negative effect on spending.
However, he said any direct impacts of tariffs, in terms of declining imports and exports, would have a “below average” impact on New Jersey because “we are not [as big of] a manufacturing state as compared to Michigan or Tennessee with their auto industries, or the Midwest which produces a lot of corn and other agricultural export products.”
However, with the largest port on the East Coast located in Port Newark/Elizabeth, there probably would be a decline in import volumes, Hughes said. “So, [the tariffs] would have some type of negative impact on the port, and that would impact wholesaling jobs and the like, but that’s difficult to forecast,” he said.
Hughes is cautious in predicting a recession. “The reality is, we had substantial positive economic momentum coming into 2025. Growth was slowing, but it was slowing to pre-COVID pandemic norms. We’re almost exactly where we would have been had we not had the pandemic,” Hughes said.
While soft metrics, such as consumer confidence, are negative, Hughes said the hard metrics, such as job growth, are still favorable. Last week, there was surprising strength when the federal Bureau of Labor Statistics reported that US employers added 228,000 jobs in March, a faster pace than the average monthly gain of 158,000 over the last 12 months.
Asked if he sees any long-term benefits to an ongoing tariff trade war, Hughes says there could be the potential for some critical manufacturing to return to the US. “We saw the negative effects during the COVID pandemic when supply chains melted. We were overly dependent on China and other nations for critical components. So, having independence on certain sectors of the economy, with internal supply chains, would be desirable. However, the critical question is: “Will tariffs actually do that?” Hughes said.
Hughes has weathered many downturns during his decades-long career as an economist. He said there was almost a complete financial meltdown of the US economy during the housing crisis of 2007-2009. “People forget how severe that was,” he said. “So, what is happening now is not unprecedented in terms of recent economic history. … We’ve gone through these ups and downs before.”