By Alex Gonzalez
Economists in Arizona and around the country said tariffs, cracking down on immigration, tax cuts and reduced energy credits will likely have a direct effect on the economy, and with President-elect Donald Trump soon to take office and having promised policy reform in many areas, change is likely on the way.
Jason Miller, professor of supply chain management at Michigan State University, said if mass deportations are executed by the incoming Trump administration, it could spell trouble for a border state such as Arizona. One in six Arizona workers is an immigrant and industries within the state such as agriculture and construction depend on their labor, according to the American Immigration Council.
"If executed, to potentially cause shortfalls of labor in the agriculture space and also the food-manufacturing space," Miller outlined. "Then what implications could that have for prices that farmers and manufacturers are going to be charging and therefore going to get passed on to consumers."
A June study by the Peterson Institute for International Economics found deporting millions of undocumented workers would result in years of subsequent inflation. With the economy having been the number one issue for so many voters in Arizona and around the nation, expectations are high for Trump to deliver on lower prices and economic stability.
Miller pointed out the U.S. economy seems to be experiencing what he calls "some good tailwinds," but added proposed tariffs could be among the things to change it. He added one of the sectors remaining steady throughout last year was the automotive industry.
"November's sales for motor vehicles were phenomenally strong for light trucks and SUVs," Miller noted. "It was on a seasonally adjusted basis, the third-highest month of all time."
Miller emphasized on a unit sale basis, which refers to the actual number of individual products sold during a time period, vehicle sales still have not bounced back to pre-pandemic levels, as people are choosing to buy more expensive vehicles, such as trucks and SUVs, but far fewer passenger cars. He added with interest rates coming down, it could help drive sales numbers back up.
