Utah companies suffer at hands of Trump tariffs on steel

Utah companies suffer at hands of Trump tariffs on steel. (Photo: KUTV)

(KUTV) — Tina Pardue has been a part of her father’s business since the day she was born.

“We had a little office that my play pen was in,” Pardue said.

Her dad started Jack’s Ornamental Iron years ago, fixing boat propellers in his garage. Tina was there watching as the business grew.

Now, she is part owner of Jack’s with her partner, Greg Schow. The two were caught off-guard when President Donald Trump announced tariffs on foreign steel. Jack’s watched the price of steel shoot up nearly 25 percent in just two weeks.

“We buy roughly a million dollars worth of steel a year,” Schow said, “so that’s going to be $150,000 to $200,000 in additional cost to our business."

The tariffs have put a halt to the growth of the company — plans to buy a nearby building for possible expansion are no longer a reality, Schow said. Also, plans for employee raises and expanding their workforce of 25 have been put on hold for now.

On Wednesday, Senator Orrin Hatch, R-UT, used Jack’s' story during a senate committee hearing on the tariffs.

"Jack's Ornamental Iron, another Salt Lake City manufacturer, saw its steel cost jump 20 percent in less than two weeks,” Hatch told Commerce Secretary Wilbur Ross during the meeting.

Hatch also sighted issues at another Salt Lake City business, Bish’s Steel Fabrication and Manufacturing, saying the company has watched as their business has gone dry within weeks.

“The company tell me that contracts for future work have all but dried up,” Hatch said in the hearing.

Pardue and Schow say the steel fabrication business is unique in many ways. In particular, in the amount of time that passes from when the contract is signed to when work on a specific project begins.

Schow says when their company writes a contract today, they do so based on the steel cost at the time, but oftentimes they won’t start the work for that contract until 12 to 18 months later. Thanks to the unexpected steel tariffs, that means the cost of steel for Jack’s will be 25 percent higher than what they quoted their clients.

“So once they give us that contract at the very beginning, we're locked in and we can't change your pricing,” Pardue said. “On our current jobs we have right now, we're just having to eat it.”

The lion’s share of Jack’s' business is dedicated to building railings and metal staircases for apartment buildings and complexes. Schow says those additional costs are not adsorbed by the building manufacturer, they ripple through the rest of the state, as well.

“Everybody passes the cost along,” Schow, said. “At the end of the day, it's the renters who are renting those apartments paying $50 more a month."

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