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In a rapidly evolving regulatory landscape, businesses face significant challenges that require agility, foresight and strategy. This article explores recent policy changes and their potential implications, offering insights on how organizations can adapt to help ensure their resilience and operational efficiency.

25% tariffs on Mexico and Canada

The potential February 1 imposition of tariffs introduces new costs and challenges for cross-border trade, urging companies to reassess their supply chain strategies.

• Tariff imposition: A 25% tariff would increase costs for businesses reliant on imports from Mexico and Canada.
• Reasoning: Tariffs are intended to heighten the US’s negotiating power in trade, promote investment in the U.S. and balance U.S. trade deficits and end unfair trade practices and currency manipulation.

Industry-specific impacts

Each industry faces distinct challenges from these policy changes, necessitating customized approaches.

• Manufacturing and tariffs: Tariffs may disproportionately impact manufacturing supply chains.
• Agriculture and immigration: Labor shortages from immigration policies may strain the agriculture sector.
• Construction and real estate: Policy shifts may hit long-term strategies, projects and profit projections.

Withdrawal from the Paris Climate Agreement

The U.S. has opted out of the Paris Agreement, altering the course for businesses invested in sustainability. This decision creates both challenges and opportunities.

• Withdrawal directive: Exiting the Paris accord distances the U.S. from global climate efforts.
• Impact on emission targets: There may be a reduction in federal pressure or incentives so businesses should reassess their contributions to emission reduction goals.
• Financial implications: Redirection of funds may change the landscape for green initiatives.

Cybersecurity implications

Policy changes often introduce new cybersecurity risks, particularly for businesses with international connections or reliance on federal systems.

• Geopolitical risks: Increased global tensions may heighten risks of foreign cyberattacks on businesses.
• Federal resource gaps: Hiring freezes could reduce , impacting regulatory bodies.

Federal hiring freeze

A hiring freeze on federal civilian employees could ripple across industries relying on government services. Businesses must prepare for potential delays and interruptions.

• Scope of freeze: Hiring is paused across the executive branch, except in critical sectors.
• Efficiency plan: Federal workforce reductions may impact regulatory processes.
• Exemptions: OPM may grant specific exceptions, influencing government interactions.

Technology and automation trends: adapting to labor and cost pressures

With labor shortages and increased costs, businesses may look to technology for solutions.

• Automation investments: Companies may accelerate automation to offset labor shortages.
• Digital transformation: Enhanced digital tools could mitigate regulatory and operational challenges.

Global trade and relations

Tariffs and climate policies have far-reaching implications for international business relations.

• Trade negotiations: Policy shifts could impact future trade agreements with global partners.
• Foreign investments: Changes may alter the attractiveness of U.S. markets for foreign investors.

Immigration crackdown: Balancing compliance and workforce stability

Immigration policies are tightening, bringing profound changes to the labor market and compliance requirements. Businesses must stay ahead by understanding these shifts and recalibrating their strategies.

• National emergency declaration: The deployment of military personnel for border security increases scrutiny on cross-border operations.
• Suspension of refugee resettlement: Refugee admissions are halted, potentially affecting labor availability.
• Challenge of birthright citizenship: Proposed restrictions could impact workforce demographics in the long term.
• Designation of foreign terrorist organizations: Cartels and gangs like MS-13 are labeled as threats, adding compliance layers for businesses with international connections.
• Restrictions on sanctuary cities: Federal funding cuts may indirectly influence local economies.
• Reinstatement of the “Remain in Mexico” policy: Asylum seekers waiting in Mexico may affect hiring from immigrant communities.

How Wipfli can help

These policy changes underscore the importance of proactive planning and adaptability in business strategy. Whether it’s diversifying supply chains, embracing automation or revisiting compliance protocols, Wipfli can help organizations be equipped to navigate complexities with confidence. Follow the latest updates on our special policy, regulation and tax updates page.