Tariffs, Taxes and Labor: What Trump’s Policies Mean for Construction and Glass

Major changes could be in store for the construction and glass industries. President-elect Donald Trump and administration officials have promised widespread modifications to taxes, domestic manufacturing, energy, business regulations, tariffs and labor. Let’s dive into several expected changes and see how they will impact the construction and glass industries. 

Tariffs

The talk of the town for the past few months has centered on tariffs. Trump is outspoken about his desire to impose more. During his first term, Trump slapped China with a series of tariffs to narrow the gap between United States imports and exports. However, the trade deficit grew by nearly $200 billion between 2016 and 2020.

According to a U.S. International Trade Commission report, Trump’s first-term tariffs, especially on all steel and aluminum imports (10%), equated to higher prices for imported and domestic construction materials and products. The tariffs increased the average steel and aluminum prices by 2.4% and 1.6%, respectively.

In late November, Trump promised increased tariffs on goods from Canada, China and Mexico. He posted on social media that he intends to sign executive orders placing 25% tariffs on the aforementioned countries. China will also face an additional 10% tariff above any existing tariffs. Karl Schamotta, chief market strategist at Corpay Cross-Border Solutions, told CNN the tariffs could hit U.S. industrial sectors hard, adding “approximately $272 billion a year to tax burdens, raise goods prices, lift interest rates and sap strength in an already-vulnerable household sector.”

Associated General Contractors of America officials write that while the tariffs are “aimed at addressing trade imbalances and incentivizing domestic production, they also carry risks of escalating costs, retaliatory trade measures and further complicating global supply chains. For the construction industry, such policies could lead to stockpiling of materials, increased contract complexity and uncertainty in project pricing and timelines.”

OSHA

Phillip Russell, partner at Ogletree Deakins, told EHS Today that changes await the Occupational Safety and Health Administration (OSHA). He anticipates a refocusing on resources and priorities. For instance, he expects the new administration to eliminate the proposed heat standard to limit over-regulation and enable companies to address the issue independently. In a report by Seyfarth Shaw LLP, company officials expect a greater emphasis on cooperation with businesses and another decline in OSHA inspectors, as low as below 800. They anticipate a slimmer regulatory agenda, reduced emphasis on whistleblower and anti-retaliation claims and a potential withdrawal of the Walkaround Rule. 

Labor

For the construction industry, talk of labor is tied to immigration. Trump has called for mass deportation of illegal immigrants. Per the U.S. Department of Homeland Security, nearly 11 million undocumented immigrants were living in the U.S. as of 2022. Nearly 1.5 million illegal immigrants worked in construction (13% of its workforce), according to data from the Pew Research Center. The Bureau of Labor Statistics reports that the construction industry is short hundreds of thousands of workers, a figure that will cause the worker pull to diminish.  

“They don’t think it’s going to happen,” Stan Marek, CEO of the Texas-based Marek Family of Companies, told NBC News regarding colleagues in the construction industry. “You’d lose so many people that you couldn’t assemble a crew to frame a house.”

Taxes

Trump wants to extend portions of the 2017 tax cut set to expire next year, and he has called for additional cuts in the corporate tax. He has also floated the idea of exempting Social Security benefits from federal taxes. In an analysis of the economic implications under Trump, Wells Fargo economists Michael Pugliese and Jay Bryson write that there is “tremendous uncertainty about what will be enacted over the course of the next two years under Trump and this Congress. Extending the Tax Cuts and Jobs Act seems quite likely, and additional tax cuts seem possible, although the size, timing and specifics are yet to be determined.”

Energy

President Joe Biden’s administration spent the past four years offering billions of dollars in federal support for clean energy to cut U.S. carbon emissions and help curb climate change. Even though Trump has made a point of focusing on oil and natural gas, climate-friendly energy technologies could thrive. Abigail Ross Hopper, head of the Solar Energy Industries Association, says the green industry sector “translate[s] across political parties,” and the demand for electricity and renewables is soaring and much cheaper than it was during past administrations.