The Economic Anxiety of a Global Trade Shift

Summary

Podcast Summary: "Is Business Broken?" Episode: "The Economic Anxiety of a Global Trade Shift"

Released June 26, 2025 by Questrom School of Business

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Introduction

In this special student-led episode of "Is Business Broken?", hosted by Grant Corbett, a sophomore at Boston University and a member of the undergraduate team at the Merotra Institute, the conversation delves into the complex world of tariffs and their implications for Boston-based businesses. Grant introduces JD Chesloff, the President and CEO of the Massachusetts Business Roundtable, an influential organization that collaborates with CEOs and business leaders statewide to shape public policy and foster long-term economic growth.

Impact of Tariffs on Businesses

The episode kicks off with Grant posing a critical question about the divergent perspectives on tariffs: opponents argue that tariffs lead to price hikes and inflation, potentially stifling economic growth, while proponents believe tariffs can reshore American industries and strengthen the U.S. economy in the long term. JD Chesloff provides a nuanced response:

“The top piece of feedback we get from employers right now is that tariffs are causing uncertainty and disruption.” [02:09]

Chesloff emphasizes that the primary concern among businesses is the uncertainty created by the frequent policy changes, which hampers decision-making in areas like hiring, investment, and mergers. This uncertainty leads many companies to adopt a "wait and see" approach, delaying crucial business activities.

Specific Challenges in Massachusetts

Focusing on Massachusetts, Chesloff outlines how specific industries are uniquely affected by current federal policies:

“Higher education, health care, life science, clean energy... a lot of those industries are vulnerable based on the policies coming out of DC.” [03:14]

He highlights that Massachusetts’ economy, heavily reliant on innovation, knowledge, and talent, faces additional threats from policies related to workforce and immigration. For instance, increased tariffs on lumber from Canada not only raise construction costs but also indirectly impact housing affordability, a significant economic challenge in the state.

Effects on Different Types and Sizes of Businesses

Grant probes deeper into how various businesses within the Massachusetts Business Roundtable are affected, distinguishing between manufacturers and service-oriented companies. Chesloff explains:

“Service industries and manufacturers... are experiencing this very differently.” [05:08]

Manufacturers like New Balance and Schneider are directly impacted by rising supply chain costs due to tariffs. In contrast, large employers have more resilience, often able to stockpile materials to mitigate tariff impacts. Smaller businesses, however, lack this luxury and are more vulnerable, potentially leading to reduced operations or even closures.

Additionally, Chesloff notes the disruption of global relationships, which have been meticulously built over years, poses a long-term threat:

“What tariffs are doing are disrupting global relationships... that’s another impact that has been coming to my attention.” [06:55]

Historical Context: Comparing to the Smoot-Hawley Tariff

Grant brings up the Smoot-Hawley Tariff Act of 1930, drawing parallels to current tariff policies. Chesloff acknowledges the importance of historical lessons:

“You can absolutely learn from the past.” [07:24]

He distinguishes the motivations behind the two periods, noting that today's tariff policies stem from a desire to reverse globalization and address supply chain dependencies. This is a philosophical shift from the post-World War II era's push for interconnectedness. Chesloff suggests that while the scale of current tariffs is significant, the underlying intent is to strengthen economic stability by reducing reliance on foreign supply chains.

Potential Future Strategies and Opportunities

Transitioning to solutions, Grant inquires about potential positive developments amidst the uncertainty. Chesloff shares insights from interactions with business members:

“Collaboration and partnerships with unlikely allies” are emerging as key strategies. [11:06]

He cites the example of Jim Rooney from the Greater Boston Chamber of Commerce, who is uniting chambers from both red and blue states to advocate for sustained research funding. Such alliances demonstrate that even amidst political differences, businesses can find common ground to influence public policy effectively.

Talent Loss and Startup Implications

The discussion shifts to the startup ecosystem, a vital component of Massachusetts' economy. Grant raises concerns about whether startups are declining due to the current economic climate. Chesloff responds:

“There are still innovators... The question is from the idea stage and moving up, what does that look like.” [12:48]

While the innovation spirit remains strong, the pathway from concept to execution is fraught with uncertainty, potentially slowing the startup momentum. Chesloff expresses apprehension about the talent challenge, highlighting risks like the outmigration of skilled workers and researchers to lower-cost states or even overseas:

“If we lose that talent advantage, that's what keeps me up at night.” [15:33]

Closing Advice and Optimism

As the episode winds down, Grant seeks a message of encouragement for students and hiring managers navigating these turbulent times. Chesloff offers pragmatic advice:

“Be patient, be nimble... constantly learning.” [19:28]

He underscores the importance of adaptability and continuous education, acknowledging that the job landscape is evolving rapidly due to economic shifts and policy changes. Chesloff remains cautiously optimistic, believing that with greater policy certainty, the Massachusetts economy can regain its innovative edge.

Conclusion

This episode of "Is Business Broken?" provides an insightful exploration of how current tariff policies are reshaping the economic landscape for Boston-based businesses. Through an engaging dialogue between a passionate student host and an experienced business leader, listeners gain a comprehensive understanding of the multifaceted challenges and potential opportunities arising from global trade shifts. Key takeaways include the pervasive uncertainty affecting business decisions, the specific vulnerabilities of Massachusetts' innovation-driven economy, and the critical importance of collaborative strategies and talent retention in navigating this new economic era.

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Thank you for listening to this episode of "Is Business Broken?" brought to you by the Ravi K. Mehrotra Institute for Business, Markets & Society at BU Questrom School of Business.

Transcript

[JD Chesloff]

Foreign.

[Kurt Nickish]

You'Re listening to is Business Broken, a podcast from the Merotra Institute for Business, Markets and Society at Boston University Questrom School of Business. I'm Kurt Nickish. One of the goals of the Merotra Institute is to educate not just through research or in the classroom, but by creating real world learning opportunities, experiences that help shape the next generation of leaders. So for this episode of the podcast, we're doing something in that spirit. We're handing the mic to one of our undergraduate students, giving them the opportunity to lead the conversation and pursue the inquiry. Before we start, I want to thank the Ralph Dinch Cook Student Forum at the Merotra Institute for supporting this episode. The forum fosters public dialogue on business and society through student led podcasts and speaker events. Now listen on and enjoy our special student led episode.

[Grant Corbett]

My name is Grant Corbett. I'm a sophomore at Boston University and part of the undergraduate team at the Meroche Institute. In this episode we're unpacking tariffs and what they mean for businesses here in Boston. To help us make sense of it, we're joined by JD Chesloff, President and CEO of the Massachusetts Business Roundtable, an organization that brings together CEOs and business leaders from across the state to shape public policy and support long term economic he brings a ton of insight into how policies made in D.C. or abroad can have on real, on the ground impact for local companies and workers. Let's get into it.

[JD Chesloff]

Sounds good.

[Grant Corbett]

Hi jd thank you for coming in.

[JD Chesloff]

Absolutely. Happy to be here.

[Grant Corbett]

I've been really looking forward to this conversation because you work at such a unique intersection between business and policy, and given everything that's going on in the recent developments in U.S. economic policy, I think that you're the perfect person to talk to. And there's a bunch of different perspectives that people can take on these tariffs. Opponents say that they're going to raise prices and that they're inflationary and it's going to constrict the economy more than grow it. And then proponents say that it's going to reshore America and make the US Stronger in the long run. What have you been seeing from businesses recently?

[JD Chesloff]

Yeah, it's a very good question. The top piece of feedback we get from employers right now is that tariffs are causing uncertainty and disruption. Those are the two words you hear the most. It's not so much about the long term impact of the policy itself and we can have a discussion about how you just articulated it. But right now the impact on companies is there's significant uncertainty because of the literally daily changes in the policy. And therefore employers find it very difficult to make decisions around hiring or around investment or around merger and acquisition activity or whatever it is. And so the response from a lot of business has been to retract, wait it out and see what happens. As you know from your studies, I'm sure business does not like uncertainty. It's the number one thing they dislike and that's the environment we're in right now.

[Grant Corbett]

And I just wanted to zoom in a little bit more and kind of talk about Massachusetts specifically. What is impacting Massachusetts that's different from the rest of the country?

[JD Chesloff]

If I think about the series of policies coming out of D.C. right now, tariffs, funding, even DEI. And you think about the industries that are foundational to the Massachusetts economy. Higher education, health care, life science, clean energy. A lot of those industries are vulnerable based on the policies coming out of dc. Right. And by the way, I would add workforce and immigration policy, because we are an economy that really is based on access to the best talent in the world and therefore we are significantly vulnerable. So I'll give you an example. I had a meeting last week with a bunch of other state roundtables. There was a guy there from Michigan and he was saying, look, in the Michigan economy, we build stuff. And so tariffs is impacting cost and supply chain. When you think about our economy, we also do some building of stuff, but we're also an innovation based, knowledge based, talent based economy that relies on research dollars to fuel innovation. That is in jeopardy now too. Then there are ancillary effects. One of the biggest competitive or economic challenges in Massachusetts is the cost of housing. The way to get out of the cost of housing is to create more supply, build more housing that becomes more expensive when there's a tariff slapped on lumber coming from Canada. And so you see an ancillary effect to our competitiveness in our economy and in our attempts here on a policy level to address the cost of housing. But all of a sudden that becomes significantly more expensive.

[Grant Corbett]

Okay. Yeah. So there's all these trickle down kind of effects that you're seeing. And then I just want to focus on businesses here for a sec. There's a lot of different businesses that are members of the Massachusetts Business Roundtable. You know, there's companies like New Balance and Schneider who produce goods. And then there's very service oriented industries like State street and kpmg. What are the kind of the effects that they're seeing? What are the differences that these companies are dealing with?

[JD Chesloff]

I'm going to answer that. In two way. Service industries and manufacturers, for example, are experiencing this very differently. And a lot of that is due to supply chain tariffs are increasing cost of the supply chain. And so if you're a new balance, if you're a Schneider, if you're any manufacturer, you're seeing cost of goods increase. I think there's also another difference between a larger employer and a smaller employer. The roundtable, as you mentioned in the introduction, is predominantly large employers. Large employers have the luxury to wait this out. There's impact on them, don't get me wrong, some of them have in response have just brought in more materials early. Right. And so sort of stockpile to avoid some of the tariffs. But there is an opportunity for them to wait it out, see what happens. Small employers don't have that ability. And if you think about some of them, even a smaller manufacturer who relies on supply chain, they can't just wait it out or else they'll be out of business. And so you have different industries, different size companies and even different regions in the Commonwealth that are experiencing this differently. But all of it is fueled by uncertainty which is impacting their business. I mean, there's one other interesting concept I heard around disruption. Right. So I think uncertainty and disruption are a little bit different. And what we heard from a lot of the large employers that you just referenced was that what tariffs are doing are disrupting global relationships. And if you think about the fact that we are in a global economy and these relationships have been built up over years and decades and all of a sudden they're being disrupted, that's another impact that has been coming to my attention and unfortunately I think has legs. So something that we're keeping an eye on.

[Grant Corbett]

Yeah. And I want to kind of go into the past and kind of look towards the past tariffs that have been put into effect. There's a Smoot Hawley Tariff act, which in 1930, it was designed to protect U.S. farmers and manufactured goods during the Great Depression by raising tariffs on over 20,000 imported goods. That was 1930. This is something that a lot of people have been referencing and saying this is something that's kind of similar. Can we compare it to this? Can we look to the past to kind of make inferences about the future?

[JD Chesloff]

I wasn't around in the 1930s, so I don't know. But yeah, the answer to your question is yes, you can absolutely learn from the past. But I do think it is instructive to think about the philosophy behind this current environment. And I think philosophically what is driving it is an attempt to reverse or address globalization. And I think that's an interesting opportunity for a debate. Do we acknowledge that we're in a global economy, or do we want to be more insular? When we're down in D.C. last week, we were having a conversation about this, and someone said to us, we were talking about the uncertainty that tariffs are creating in each of our states. There are probably, like I said, 17 or so state roundtables down there. And the response was, look, if our country is beholden to another country, if they control our supply chain, if there is a trade imbalance that's in their favor, then they could impact the supply chain and our economy at a moment's notice. And that is what the proponents of this current policy, tariff policy, are trying to address. Right? There is uncertainty. There is what we were told, and that uncertainty is something we want to address. So it's a different philosophy. And so if you are looking to be less active in globalization, a global economy, then, yeah, I think what they're doing makes some sense. If you don't believe that and you believe we are a citizen of a global economy, then perhaps it's not the right strategy.

[Grant Corbett]

From the way I see it, there's no way that the US by itself can build up this economy that it relies so much on for the rest of the world. Since the end of World War II, we've seen this massive push for globalization, so much more interconnectedness, and especially through the 90s, you know, the globalization of the US kind of at the center of it. I don't realistically see the US Making a lot of leaps and bounds without massive investment and a lot of massive time that necessarily won't happen in the next four years. And so my question is, do you think that this strategy is, you know, kind of all part of art of the deal? You know, it's something that the administration is kind of known for. Is it kind of just waiting out the other countries? You know, since we were the central artery for this globalized system, are we waiting them out to come to the negotiating table to get some sort of deal made?

[JD Chesloff]

I think we'll see over the course of the next few weeks and months if the deals actually happen. There's a question of scale here in some of this. If you think about the purpose of what they're trying to do with tariffs, the purpose of what they're trying to do with DOGE and reducing the size of cutting waste out of government, if you think about sort of reviewing federal funding of research, there's A philosophy there, that there is waste and some of this stuff is wasteful and we need to address that. That's more difficult to argue with than taking the chainsaw to it. You can see a tinge of the philosophy and say, okay, that makes some sense. But it's the scale of it. It goes so big, big and so far that the impacts, as we're seeing right now on the economy are dramatic. If they thought about doing it something more incremental, if it weren't sort of go really big and then retract, then maybe the impact would have been different. But that's not how it's being implemented.

[Grant Corbett]

Okay. Obviously it's a lot of wait and see. That's the general strategy that we're kind of seeing here. And a lot of what I've been hearing just in the media and you know, kind of generally throughout this conversation has been sort of pessimistic. And I just want to talk about, you know, what are some potential operations opportunities during this time? How can we potentially grow out of this?

[JD Chesloff]

Yeah, so I love that question. It's the question that I get from my members when I do the state of play for them. As I've been kind of socializing that question with members and in other rooms that I'm in, the general response that I get is around collaboration and partnerships with unlikely allies. I'll give you an example. When I was in D.C. with our folks from around the country, there are blue state roundtables like ours who just don't have the access to the current administration that red states do. And so you see partnerships forming between blue state and red state business organizations. You see a great example right now being led by Jim Rooney, who runs the Greater Boston Chamber of Commerce here, who's convening chambers from around the country, red and blue state, to come together to make the case to the federal government that, look, research funding is important to all of us. It's not just this state. I think there is opportunity in the alliance of unlikely allies, folks who generally don't work together, to come together around a shared message.

[Grant Corbett]

I wanted to go back to that conversation that we were having earlier about the different businesses that are being impacted. There's the large companies and then there's the smaller companies. I think there's a third one there that we skimmed over is startups.

[JD Chesloff]

Yeah.

[Grant Corbett]

In my opinion, entrepreneurship is probably the most value added profession that you can go into. And right now it seems like there's a lot of policy and a lot of decisions that are going on And a lot of uncertainty, which is horrible for if you want to start a business. Boston obviously has a very strong track record of, of, of innovation and of startups.

[JD Chesloff]

Yeah.

[Grant Corbett]

Are we seeing a kind of decline in startups?

[JD Chesloff]

Yeah, I like to, to think that we're not because it's such a significant component of, of the Massachusetts economy. And frankly, the Massachusetts story, there is hesitancy out there, particularly now. If you think about where startups get their funding, for example, what do those funding streams look like? I don't think there's a pause in the innovation behind the thought. I think there are still innovators who are thinking innovatively and coming up with amazing ideas. The question is from the idea stage and moving up, what does that look like? And that worries me a little bit about kind of this general economic pause and what that would mean. I still do believe that we have a culture here in Massachusetts that is conducive and supportive and will foster a startup economy. But I do feel like there's a lot of things on pause right now.

[Grant Corbett]

Okay, and just out of curiosity, what do you think needs to change in order for innovation and startups to kind of come back?

[JD Chesloff]

Certainty. There just simply needs to be more certainty about where public policy is heading. And once that happens, I think you'll see a lot of this resume.

[Grant Corbett]

Yeah. And I wanted to kind of go back and there's obviously economic policy changes going on, but then there's also some other not so economic policy things that are going to impact, you know, the startup culture or whatever. And again, Boston has had a very strong track record in the past of having, you know, very talented individuals from other countries coming in and starting and contributing their talents. Do you think honestly that there's going to be any change in that?

[JD Chesloff]

Yes. And look, if I, if I were to tell you the one thing that keeps me up at night sitting in my seat at the business roundtable, it's the talent challenge in this state. There are a few things that I worry about. Cost of living and out migration of folks your age and a little bit older, like sort of working age population who come here and used to stay here, now can't afford to stay here and leave. And to your point. Yeah. Not only students, but researchers who are coming here, doing their work here, fueling our innovation economy, and are leaving for whatever the reason is. Right. It could be cost of living or it could be because your federal funding dried up. We are an economy, like I said before, that historically, for decades has been based on having access to the Best talent in the world. That is our sweet spot. It's our calling card. If we lose that talent advantage, that's what keeps me up at night. And so to your question. Yeah, I'm worried about it.

[Grant Corbett]

Where's this talent generally going? Are they going? Because I kind of in my mind imagine there's going to be a massive growth in the southern part of the United States. I'm sure you talk to a lot of people from business roundtables down there. I'm seeing a lot of growth in manufacturing there. And I'm kind of thinking maybe that's where these people are going. The cost of living there is lower.

[JD Chesloff]

It's lower cost states.

[Grant Corbett]

Is that generally where.

[JD Chesloff]

Yeah, and 100%, it's lower cost states and it's other countries. Now that's what sort of getting back to our topic, which is tariffs, Europe is being very aggressive with this and they see an opportunity to grab some really great talent from this state and from around the country and say, come here, do your research here, innovate here. That also has the legs. I mean, if we start losing that talent and they're going over to Europe to set up shop, it's not like I said before, once certainty settles in, they're all going to come running back. That's a concern. That's a big concern. So, yeah, I think the working age adults the data will show is going to lower cost states. The question that you asked about students, researchers, innovators. I think the threat is from other countries.

[Grant Corbett]

Yeah. And I was just kind of curious. Is there something that businesses could be doing to try and get things going or do they exist in this kind of weird space where they can't influence public policy as much because there's these great powerful companies. This is the United States, obviously there's a lot of power that lies in the hands of these companies. Are they completely powerless in this situation or is it really just comes down to what the economic policy and what the government policy is?

[JD Chesloff]

It's a great question. I don't think they're powerless. No. I think the business community has a pretty significant voice. If you think about here in Massachusetts, what we do in partnership with a whole bunch of other business associations, I think the number one thing we can do at this point is educate. What I've been told is as a strategy around that, that anecdotal evidence of impact has more impact than just saying this is going to hurt my company or my economy. We can have an impact on public policy, but I absolutely believe business has A voice. And I think you may not see it being used publicly, but it absolutely is being used privately.

[Grant Corbett]

A thought that I've been having a lot recently is, is this kind of just a fever dream and it's all going to kind of go back to normal in a few months, or is this kind of really a new world order and it's totally changing how we view the economy? I could see it going either way. Honestly, it's kind of a flip of the coin. I just wanted to get your perspective and see if you could.

[JD Chesloff]

We were just having this conversation. It is a flip of the coin. The conversation that I was just having actually, before I came here to see you, was that it's not gonna go back to the way it was. It'll be different in some way. Whether it's a significant difference or a subtle difference, we don't know yet. But it's hard to reverse this stuff quickly. And so we'll just have to see. And what I keep coming back to is that comment I heard about global relationships. I think it'll be hard to repair those quickly. I'm not comfortable saying they'll never be repaired.

[Grant Corbett]

Right.

[JD Chesloff]

But I think it takes time.

[Grant Corbett]

So I just kind of want to close out with a note of optimism. I wanted to talk about, you know, as a student, and there are a lot of young people who are probably going to be listening to this and a lot of managers who are going to be trying to navigate, you know, how you hire people. Where are you going to be sourcing the talent from? What advice would you give to students who are kind of worried, you know, whether they're an international student, whether they're a domestic student, and just trying to find a job during this uncertain time? Because, as you mentioned, there's a lot of uncertainty around employment. What would you recommend to both students and to hiring managers just in this time?

[JD Chesloff]

Good question. Be patient, be nimble, and I think acknowledge that the job that you're going to be in may not even exist yet. Right. I mean, there's so much change happening and innovation happening in the economy. Maybe not your first job, maybe your second or third job doesn't exist yet, but I think that's all part of being nimble. Constantly learning. You don't leave here and stop your learning, you continually learn, and you'll need to do that to be prepared for whatever is coming in the economy.

[Grant Corbett]

I think we'll close with that. Thank you for listening. This was the student episode brought to you by the Ravi K. Marotra Institute JD thank you so much.

[JD Chesloff]

Thank you.

[Grant Corbett]

Sam.