In Midtown’s Garment District, grey and brown buildings are transformed by colorful storefronts. Fabrics, rhinestones and feathers, in every imaginable texture and size are showcased in several display windows.
Yet looming over these fashion businesses is the latest threat to the district’s future: tariffs.
The Trump administration’s high tariffs on imported goods have placed significant financial strain on the apparel industry. While the changes were intended to boost domestic manufacturing, store owners in the Garment District say they now face higher supply chain costs for foreign-made products. Although some tariffs have been paused or reduced, businesses importing from Africa and Asia may still face rates of up to 30%, a burden that could force some stores to close.
Young Lee, owner of New York Lace & Fabric, said tariffs have raised fabric prices by 10 to 20%, with his materials coming from Turkey, India, Korea, Japan, and Taiwan. So far, he has not raised prices to avoid losing customers, absorbing the additional costs himself. But he expects to increase prices “very soon,” he said, “between November and December.”
The burden of tariffs on the fashion industry is not a recent phenomenon. The American Apparel and Footwear Association reports that footwear and apparel are subject to tariff rates more than five times higher than those imposed on other U.S. imports. In 2024, the association noted that despite fashion goods making up only about 5% of all imports, they generate over 25% of the country’s tariff revenue. But this has not been enough of an incentive for the fashion industry to promote U.S.-based manufacturing.
According to the United States Fashion Industry Association, an advocacy group for textile and apparel companies, most U.S. clothing manufacturers are small micro-factories that are not equipped to become full-scale fabricators. Consequently, tariffs that were originally designed to protect domestic production often end up weakening businesses instead of strengthening them.
A study the association conducted this year found that over 70% of surveyed companies reported that higher tariffs have increased sourcing costs, squeezed profit margins, and pushed up consumer prices. About half of respondents have seen a decline in sales, and 22% indicated that they had to lay off employees as a result of the increased tariffs.
Yet some Garment District stores have enough inventory to last through the year, delaying the need to raise prices on merchandise.
John Paul Ataker, a manager of a made-to-measure, luxury store that bears his name, said his biggest advantage is that he stocked up early. But that supply will run out by the end of the year, he said, and prices are expected to increase. Because his garments are customized with fabrics that are sourced from different parts of the world, the price increases will depend on the tariff rate by country, he added.
“We don’t know what’s going to happen tomorrow with the prices of labor and imports, and how much that is going to change us,” said Ataker.
Sonja Chapman, a professor at the Fashion Institute of Technology, said the uncertainty around tariffs could have a drastic impact on the fashion economy. “The instability of tariff by decree is the most harmful aspect of this administration’s trade policy,” said Chapman in an email. “The vast majority of apparel sold in the United States is imported. These imports provide millions of jobs to merchandisers, designers, sales personnel, marketing personnel, customhouse brokers, freight forwarders, truckers, warehousemen, dock workers, etc…all of those jobs are American jobs,” she added.
But tariffs are hardly the only challenge for Garment District businesses. For years, stores have struggled to compete with online retailers and faced further hardships when the COVID-19 pandemic hit. Yet some continue to emphasize the need for brick and mortar establishments in the Garment District.
Andrew Lin, a retail worker at Hai Trim & Feathers, defended the importance of experiencing products inside a store. “I’ve noticed that to be creative, you have to shop in person,” he said. “You need to touch them and feel them. If you photograph a feather, the color will look completely different depending on how the light hits it.”
The impact of how tariffs will impact consumer prices will become clearer in the coming months, but the burden will fall on customers if stores are forced to raise their prices, said Chapman in an email. “While our government sees the revenue as a benefit, that revenue is ultimately provided by the consumer who pays the higher price for the product they buy.”