U.S. President Donald Trump has signed an executive order doubling tariffs on steel and aluminum imports, raising them from 25% to 50%. The new measure, effective as of today, Wednesday, has sparked widespread concern among business and political circles both in and outside the U.S.

The Trump administration states that the decision aims to protect the American steel industry, which the president described as “critical to national security.” However, the White House’s hardline stance is already fueling a wave of responses—from canceled orders and higher costs for American companies to the risk of retaliatory trade measures from key partners.

Although Trump claims the goal is to boost domestic production, data shows that steel imports had only dropped by 17% in April—prior to the tariff hike—while total production remained flat.

Economists warn of more significant losses this time. A 2020 analysis showed that Trump’s first-term tariffs created roughly 1,000 steel industry jobs but caused the loss of 75,000 positions in other sectors such as manufacturing and construction.

“It’s highly reckless to insist on this kind of measure, especially when it concerns intermediate industrial goods that drive up production costs throughout the supply chain,” said Erica York, vice president of tax policy at the Tax Foundation.

Pressure and Turmoil for Small Businesses

Trump’s decision has already sent shockwaves through many small and mid-sized businesses. Chad Bartusek, supply chain director at family-owned Drill Rod & Tool Steels in Illinois, imports around 800,000 pounds of Austrian steel annually—a material he says is not produced to the same specifications in the U.S.

Just this past Saturday, Bartusek saw his estimated tariff cost for a new shipment jump from $72,000 to $145,000. “It felt like a punch to the gut. I couldn’t believe it,” he said. His company has already been forced to raise prices and cut employee hours.

International Tensions and Selective Exemptions

While most of the U.S.’s trade partners are affected by the increase, the United Kingdom has been temporarily exempted, maintaining tariffs at 25%. Trump attributed the exemption to ongoing trade negotiations between the U.S. and the UK.

In London, the tariff announcement added pressure on the government to finalize a free trade agreement with the U.S. Trade Secretary Jonathan Reynolds said he was “pleased” that UK steel products are currently protected, and pledged that negotiations would continue.

The EU and Canada have both left open the possibility of retaliatory trade measures. Olof Gill, spokesperson for the European Commission on trade matters, stated that both sides are engaged in “intensive negotiations,” expressing hope the U.S. would reverse the new measure.

Trump, however, shows no sign of backing down. Speaking at a US Steel factory on Friday, he declared his goal is to make imports so unprofitable that companies have no choice but to turn to domestic suppliers.