All US metros worse off from recent tariff announcements

President Trump’s recent tariff announcements, and the global response, have meant a fast-changing policy landscape with significant effects on our global, national, and subnational outlook.

As a result, we have downgraded our short-term growth prospects for US metros to correspond to the weaker April macroeconomic forecast published earlier this week.

What you will learn:

• Every economy will be affected by the dramatic policy shifts, but the US slowdown will be especially acute. We have lowered our near-term forecast for US national GDP growth to 1.2% in 2025 and 1.6% in 2026, compared to 2.0% and 2.5%, respectively, in our March forecast.
• Nearly all sectors will see weaker near-term growth. Manufacturing will bear the brunt of the downgrade due to uncertainty weighing on investment and activity, and as tariffs raise input costs. Weaker investment also underpins a downgrade for construction. While service sectors in general are more insulated, some will be exposed―transport and logistics, via supply-chain disruption―and retail and hospitality, given squeezed real incomes and subdued spending.
• Our preliminary results indicate that all metros will be worse off given the recent policy changes. However, the downgrades will be far from uniform across locales, based on the spatial distribution of vulnerable sectors. Our analysis finds that the disparities in major metro performance will slightly widen―i.e., the biggest GDP downgrades are likely to be faced by legacy manufacturing hubs that were already laggards in our March forecast, while tech-focused West Coast metros should be less exposed.