U.S. President Donald Trump imposed tariffs on foreign countries to boost America, but the move seems to have backfired on him only. After the tariff announcement in April, the bankruptcies among U.S. companies has increased.
In July alone, 71 major companies declared bankruptcy.
U.S. Companies Go Bankrupt
So far this year, 446 major U.S. companies have gone bankrupt, which is 12% higher than the pandemic year of 2020. July’s 71 bankruptcies were the highest monthly number since July 2020.
Trump had imposed a 10% tariff on foreign goods in April, and coincidentally, bankruptcies began to rise that same month. In the first half of 2025, 371 large U.S. companies went bankrupt, with 63 companies filing for bankruptcy in June alone. The list includes several popular brands like Forever 21, Joann’s, Rite Aid, Party City, and Claire’s.
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Donald Trump’s Highest Tariffs In 90 Years
Small-cap companies have been hit the hardest. By the end of 2024, 43% of Russell 2000 companies were in the red which is the highest since 2020. During the 2008 financial crisis the figure was 41%. With Trump’s tariff war underway, effective U.S. tariffs now at 17.3% are the highest since 1935 despite multiple revisions.
Bankruptcies are spread across sectors like 70 companies in industrials, 61 in consumer discretionary, 32 in healthcare, 22 in consumer staples, 21 in IT, 13 in financials, 11 each in real estate and communication services, 7 in materials, 4 each in utilities and energy.
US Unemployment And Inflation On Rise
Tariffs may worsen inflation and unemployment. In July, 11% of small businesses reported very poor sales which is an indicator of rising unemployment. Small businesses employ 62.3 million people and about 45.9% of the U.S. workforce. Among young Americans aged 20-24, unemployment averaged 8.1% over the past three months, the highest in four years and comparable to 2008 crisis levels.
Story Highlights
- Donald Trump Tariffs Impact On American Companies
- Trump Tariffs link to US companies bankruptcy
- US Bankrupt companies number increases
- US Inflation and unemployment on rise
Although Trump has been pressing for rate cuts, analysts believe the Fed may reduce rates by only 25 basis points in September.