The Tariff Delay Is Now Over, Companies Start Hiking Prices Again

Hello consumers, expect higher prices in the high single digits on many items.

Companies Are Jacking Up Prices Again

The Wall Street Journal notes The Break Is Over. Companies Are Jacking Up Prices Again.

Companies from Levi Strauss (LEVI) to McCormick (MKC), among others, say they are raising prices early this year on items from bluejeans and spices to housewares and industrial products.
After holding the line on prices for several months, companies—big and small—have begun a new round of increases, in some cases by high-single-digit percentage points.
Companies had raised prices last year after tariffs hoisted costs. Yet starting in the fall, many firms held off on increases and sometimes offered discounts to capture holiday shoppers.
The pricing break is over. Many companies typically raise prices at the start of the new year. Yet increases appeared to be stronger than normal for January for electronics, appliances and other durable goods, said UBS (UBS) economist Alan Detmeister.
Some companies have pointed a finger at tariffs for their increases, while others, especially small businesses, also blame higher wages and hefty health-insurance costs that firms said they can’t absorb or share with suppliers.
Columbia Sportswear (COLM) said it is upping prices of spring and fall merchandise by, on average, a high single-digit percent after mostly avoiding increases for fall and winter goods. The company said it has also renegotiated prices with its factories and taken other steps to reduce costs.
Such new price increases follow last year’s wave of tariff-driven price hikes. Retail prices started falling beginning in October, with the biggest drops before Black Friday, Harvard’s Cavallo said. But they then started rising again, particularly after Christmas, in what looks like a postholiday reset.
Levi Strauss raised prices last month in response to tariffs and is rolling out additional price increases this month. Among the items now costing more: ribcage straight ankle women’s jeans, priced $10 more at $108, and original fit men’s jeans that are $5 more at $84.50.
Structural Systems Repair Group, a Cincinnati-based construction company, is taking a 10% to 15% increase in prices that will show up in new contracts this year.
SSRG typically absorbs increases in materials costs totaling 5% or less, but tariffs pushed steel prices up by 10% last year, said Bryan Erickson, the company’s president. SSRG’s healthcare costs for its 115 employees increased by a similar amount, he said.
“It’s not sustainable for us to tolerate that kind of increase without some sort of concession from our customers,” said Erickson, whose company adapts and maintains parking garages, stadiums and other structures.
Higher costs can be particularly challenging for small businesses, which typically have thinner profit margins than big companies and fewer ways to offset higher expenses.
Many businesses have tried to offset tariffs and other inflationary pressures through cost-cutting and by pushing back on suppliers. But some companies said those options alone weren’t enough.
Tariff expenses added $70 million in gross costs last year, and will add another $70 million this year, according to spice maker McCormick & Co.
The company raised some prices in September in response to tariffs, inflation in core commodities and higher packaging costs, and it is increasing some more prices this month.
More than half of small business leaders said they planned to increase prices in the next three months, according to a December survey of 600 entrepreneurs by Vistage Worldwide.
Nearly 70% planned increases of 4% to 10%, while another 10% forecast increases of more than 10%, according to the business coaching and peer-advisory firm.
Atomic Object, a Grand Rapids, Mich.-based digital software consultant, raised the hourly rate it charges its customers to $200 this year, after boosting rates to $195 an hour from $180 an hour at the end of 2024.
“We tested the market at $195 and said we would hold here,” said Jeff Williams, a managing partner. “But increases in salaries and benefits are driving expenses higher and higher.”
The company’s health-insurance premiums jumped by 14% this year after climbing by 12% in 2025, and now equal nearly 10% of revenue, up from about 5% three years ago.

There were three key ideas in the article. One of them is indirect.

Three Key Ideas

Tariff-Related Price Hikes Will Hit in 2026
Medical Care Costs Rising for Everyone
Companies Hiking Prices to Offset Healthcare

I have discussed rising medical care costs for everyone, point number 2, multiple times.

The knock-on impact of point 2 is point number 3, which I have not discussed.

Inflationary Forces

Medical Care direct expenses paid by consumers
Medical Care indirect expenses paid by corporations
Medical care knock-on impacts paid by consumers
Tariff hike passthroughs
Budget deficits
Labor shortages caused by deportations especially construction, agricultural, hotel staff
Utilities
Homeowner’s insurance (except this is not accounted for anywhere officially).
Property taxes (except this is not accounted for anywhere officially).
Tips (except this is not accounted for anywhere officially).
Tax cut refund impact
Energy prices, assuming I am correct that crude oil has bottomed
Utility bills