Idaho braces for economic uncertainty under proposed Trump policies
Chloe Baul
BOISE, Idaho (CN) — Idaho’s farmers, small businesses, and migrant workers could soon face higher costs, labor shortages and disrupted trade relationships due to President-elect Donald Trump’s proposed tariffs and immigration policies.
The changes could pose significant challenges to the state’s economy, experts say.
Aiming to boost U.S. manufacturing, President-elect Donald Trump has proposed tariffs ranging from 10% to 25% on imported goods. While this could benefit some industries, experts caution that it might also lead to price increases and challenges for industries heavily reliant on trade.
Idaho’s key exports — dairy, beef, wheat, and potatoes — depend on trade relationships with countries like Canada, Mexico and China. If tariffs reduce the competitiveness of these exports, it could affect farmers and ranchers across the state.
“During the first Trump administration and since then, including during the Biden administration, the total value and volume of Idaho agricultural exports have continued to climb to record levels,” Sean Ellis, spokesperson for the Idaho Farm Bureau Federation, said.
“We hope that whatever happens on the trade front, it ends up being a net positive result for Idaho agriculture,” Ellis added.
Trump’s planned immigration policies likewise present a challenge to Idaho’s economy. The returning president has proposed to deport millions of undocumented workers and potentially eliminate the H-2A visa program, which provides seasonal agricultural labor. That could further strain Idaho’s workforce, especially in the agricultural sector.
As these policies begin to take shape, experts suggest their impact on Idaho’s economy (along with the broader U.S. economy) remains uncertain.
“It’s hard to forecast or project what the specific impacts might be,” said Karl Geisler, an economics professor at Idaho State University. “Hopefully, this is just an opening bid in a negotiation, and we end up with relatively low tariffs. We’ll have to wait and see."
Tariffs, inflation and rising costs of living
According to Geisler, tariffs essentially function as taxes.
For Idahoans, this could mean paying more for products like groceries and appliances.
"Producers are really good at passing increased costs onto the consumer," Geisler said — but the impacts could reach businesses, too. “With global supply chains, so many companies use components from all over the world,” he said. “Any time one of those components comes from a place that has a tariff, we could see an increase in price.”
Theoretically, businesses could switch to domestic suppliers. After all, that’s a purported goal of Trump’s trade policies: to keep money circulating in the national economy.
While that might seem like a solution, it comes with additional costs, Geisler said.
“The fact that they’re using an international supplier points to it being cheaper in the first place,” he said. “Moving to a domestic supplier is still going to be a cost increase.”
Tariffs can be a valuable tool to protect industries or encourage domestic production. Targeted tariffs like those on microchips can help reduce reliance on foreign sources for critical goods.
Even still, broad tariffs of the kind Trump has proposed are more likely to trigger inflation and lead to retaliatory measures. As Geisler puts it: “The broader the tariffs, the more likely we are to see widespread inflation.”
The end result could be a vicious economic feedback loop. Higher prices could force Idahoans to cut back on spending, which could reduce demand for local goods and services. That could lead to layoffs at both export businesses (if demand declines) or import ones (if costs go up).
The impacts could be particularly felt at small- and medium-sized businesses — and especially those in the export sector. “Exporting industries are likely to bear a much higher cost when it comes to decreased demand for their goods and services,” Geisler said. “They’ll have to do more furloughs or lay people off.” That could create headaches for the Idaho economy, where many businesses depend on getting products like dairy, potatoes, beef and wheat to markets abroad.
A threat to Idaho’s exports — and its migrant workforce
When the U.S. imposes tariffs, other countries often retaliate by targeting sensitive industries.
For Idaho, that could spell trouble.
In November, after U.S. President-elect Donald Trump threatened to impose 25% import duties on Mexican goods, President Claudia Sheinbaum suggested that Mexico might respond with tariffs of its own.
“One tariff would be followed by another in response,” the Mexican president said.
Rick Naerebout, CEO of the Idaho Dairymen’s Association, says retaliatory tariffs from countries like Mexico or China could further add to the challenges facing Idaho farmers.
“Mexico is the largest importer of U.S. dairy products,” he said. “Any discussion around tariffs with our significant trade partners is definitely going to get our attention.”
Trump’s immigration policies could have far-reaching effects in Idaho as well. An estimated 35,000 undocumented immigrants work here, in sectors like agriculture, construction and hospitality.
Although they are ineligible for public assistance, 86% of these migrants work and pay taxes, a report from the University of Idaho’s McClure Center found. Large-scale deportations could harm the economy, Naerebout warned.
Around 90% of workers in the state’s dairy sector are foreign-born — but “this issue goes far beyond just Idaho’s dairy industry,” he said. “Mass deportations and removals could significantly damage agriculture across the board.”
Dairy is Idaho's largest agricultural export, followed by beef, wheat, and potatoes. The value of Idaho’s agricultural exports has increased for three straight years, breaking records each time, according to data from the Census Bureau.
“If we want a growing economy, we have to have immigrant workers,” Naerebout said. “We don’t have enough domestic workers to fill the jobs that are needed to support our economy.”
Sectors like dairy need year-round labor and therefore don’t rely as much on tools like visa programs for seasonal workers. Still, given Idaho’s agriculture-dominant economy, “we’re uniquely at risk,” Naerebout said.
The end result of new tariffs and immigration restrictions could be counterproductive, further driving food production to cheaper places abroad rather than promoting domestic agriculture. In Naerebout’s view, that would be a shame. “Do we want to produce food here domestically, with our standards,” he asked, “or do we want it produced somewhere else?”