Tariffs Will Cost Schools Billions

Schools buy a lot of stuff. And many of those things are made internationally. So, as President Trump imposes tariffs on foreign-made goods, that will raise prices on schools and mean they either need to buy fewer things or find savings elsewhere, such as by reducing their expenditures on staff.

How much of an effect will tariffs have on schools? That’s hard to know with any degree of certainty, but they could potentially cost schools billions of dollars.

From the school side, we have no way of knowing where their purchases originate from. For example, remember that tariffs have nothing to do with where a company is based, only where its products are made. That is, if an American textbook publisher produces most of its printed materials in China, they would face a tariff when they imported those books into the States.

Still, we can start to put some numbers on the impact to schools by looking at what they currently spend on purchased goods. Not all of these are sourced internationally or just from the countries subject to the new tariffs (so far), but let’s assume they are. The National Center for Education Statistics (NCES) tracks several categories of school expenditures that are relevant here, and in the table below I’ve sorted them into three main categories: textbooks, supplies, and equipment.

The first and most straightforward is textbooks. These include books for classroom instruction and for school libraries. In 2021-22, public schools reported spending $3.4 billion on textbooks. If they had faced a 10% tariff on those purchases, they would have had to spend an additional $344 million. With a 25% tariff, the cost of the books would have risen to $861 million.

Table: Estimating the Potential Impact of Tariffs on Schools

Spending Category Amount schools spent in 2021-22 Potential cost of 10% tariff Potential cost of 25% tariff
Textbooks $3.4 billion $0.3 billion $0.9 billion
Equipment $13.0 billion $1.3 billion $3.2 billion
Supplies $49.4 billion $4.9 billion $12.3 billion
Total $65.8 billion $6.6 billion $16.4 billion

Note: Totals may not add up due to rounding

Source: NCES Common Core of Data

The next biggest category is equipment. This includes machinery; vehicles; furniture, fixtures, desks, file cabinets, typewriters, duplicating machines, computers, and audiovisual equipment; initial purchase of property items such as books for a newly constructed library; equipment for newly constructed laboratories; computers, modems, printers, disk drives, and computer furniture; and equipment used in providing food to students and staff including ovens, dishwashers, and refrigerators. Schools spent $13 billion on these items in 2021-22. If they had faced additional tariffs on all these items, their costs would have been $1.3 to $3.2 billion higher.

The largest category of goods purchased by schools are various types of supplies. “Supplies” is a broad category, but it includes purchases of other (non-textbook) books, reference books, periodicals, paper and other materials required for printing and copying; films, slides, tapes, videotapes, television programs; other classroom supplies like tape, scissors, or chalk; medical supplies; expenditures for energy such as electricity and natural gas purchased from a public or private utility, bottled gas, gasoline, and oil and coal for heating; and other general supplies such as paper towels and cleaning supplies.

All told, public schools spent over $49 billion on these items in 2021-22. If schools had faced a 10% or 25% tariff on all of these goods, they would have needed to spend an additional $5-12 billion.

Across all three categories of purchased goods, tariffs could add $6.6 to $16.4 billion in additional costs for America’s public schools. This is probably a high estimate, but it does not include the costs of tariffs on colleges and universities or on private schools, which educate about 10 percent of K-12 students across the country and which also need to buy textbooks, equipment, and supplies.

During the last Trump Administration, the Office of the U.S. Trade Representative Office made a number of “exclusions” for certain companies and industries. Could they make a similar exception for education?

There’s a strong case to be made for it. For one, schools are the backbone of civil society. Students of today will become tomorrow’s scientists, business leaders, and creative artists. And investing in our nation’s future has long-term benefits through higher achievement and higher future earnings. That pays dividends for all of us.

Besides those longer-term gains, education is one of the largest industries in our economy, especially in certain communities. Nationwide, public schools serve nearly 50 million students in grades K-12 and employ more than 8 million staff. There’s a strong economic argument to make for protecting those students and staff from the harms of tariffs.

It’s also a bad time to raise costs on school districts, which are dealing with the end of the last round of federal COVID relief funds at the same time they’re trying to get kids back in school and on track academically. Schools are already starting to cut back on before and after school and summer programs, tutoring programs, and other student supports. Adding the cost of tariffs on top of all of their purchased goods would only lead to steeper cuts.

For any teachers or school leaders reading this, look around your building and classrooms. What materials came from foreign sources, and how much will their prices rise after the Trump Administration imposes a tariff on them?

About Chad Aldeman

 

 

Chad Aldeman is a nationally recognized expert on education policy, including school finance; teacher preparation, evaluation, and compensation; and state standards, assessment, and accountability. Keep up with Chad on the EduProgess: Unpacked blog.

About the Author

Chad Aldeman is a nationally recognized expert on education policy, including school finance; teacher preparation, evaluation, and compensation; and state standards, assessment, and accountability. Keep up with Chad on the EduProgess: Unpacked blog.

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