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Uncertain Tariffs Make Beauty a Lot Uglier

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President Donald Trump’s alleged “liberation day” for American trade is set for April 2 and will usher in higher tariffs on top of those already in place. While the White House is narrowing its approach on reciprocal tariffs and even preparing to exempt certain countries, new fees on imports will raise the price of everything from automobiles to daily essentials, including beauty products.

As with most other sectors of the economy, the beauty industry relies heavily on trade. In 2023, the U.S. imported $6.58 billion and exported $6.86 billion in beauty products. Even though this represents a near one-to-one import-to-export ratio, only 7 percent of beauty and personal care products, like deodorants, soaps, and oral care items, sold in the U.S. are manufactured domestically.

While the president hasn’t levied an import tax on beauty products specifically (at least not yet), Trump-imposed tariffs have already affected $445 billion in total trade with China. His current 20 percent levy on all Chinese goods includes plastic products and packaging, which is a commonality between all beauty products, from the luxurious to the utilitarian.

The U.S. imported $114 billion worth of plastics and rubbers in 2023, making it the largest importer of plastic products in the world. Meanwhile, China was the largest exporter, exporting $159 billion worth of plastic goods that same year. Plastic imports from Canada and Mexico, America’s second- and third-largest suppliers of plastic in 2022, respectively, are expected to face a 25 percent premium come April 2.

Moving the manufacturing of essential products, like plastic packaging, to the U.S. is a stated goal of tariff supporters, but it is easier said than done. Plastic production is done overseas because labor costs in countries such as China ($7 per hour) and Mexico ($5.10 per hour) are substantially lower than in the U.S. ($30 per hour). Meanwhile, building the necessary infrastructure to support a domestic manufacturing spree would be expensive, especially as firms navigate stricter regulations and compliance costs.

Even if American plastic production could scale up, consumers of self-care products would not be impervious to tariffs.  The beauty industry isn’t able to fully onshore production since products rely on materials that can’t be fully sourced or replicated in the United States, such as Asian or African oils. Stringent patent protections, meanwhile, require that certain formulas be sourced from ingredients from specific geographical regions or countries.

Hair care and salon services have seen supply chain disruptions since 2019 that have increased prices by 27 percent. In response to higher costs, Americans are choosing low-maintenance options, going longer between appointments, or forgoing services altogether. A trade war increases the cost of everything, including daily beauty essentials. Even the mere uncertainty of increased tariffs will exacerbate the challenges salon owners and consumers face, forcing more Americans to trade down.

The post Uncertain Tariffs Make Beauty a Lot Uglier appeared first on Reason.com.


Source: https://reason.com/2025/03/25/uncertain-tariffs-make-beauty-a-lot-uglier/


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