Stela Perez makes jeans, tops and dresses out of her fashion company, A Cut Above the Rest LA, but says the price of materials and labor has recently decimated her "made in America" business. Jo Ling Kent reports.

Los Angeles

A Los Angeles-based fashion business owner, Stella Perez, says tariffs have sharply increased her costs and forced her to lay off workers. Perez, whose company produces garments for brands across the U.S., notes that most materials are imported from China, and the resulting price hikes have led to a significant drop in orders.

A recent survey found that over a third of small businesses are negatively affected by tariffs. Perez expresses doubt about the feasibility of bringing large-scale manufacturing back to the U.S. due to a lack of infrastructure and higher costs. The report also notes that small businesses continue to face high borrowing costs, with no expected relief from the Federal Reserve. Separately, a major railroad merger is under consideration, which could reshape freight shipping in the U.S.

L.A. fashion designer says tariffs have decimated her business

Americans do have a sunnier outlook on the economy. Report out today finds consumer confidence rose this month. Their main concern remains the impact of tariffs, and Jolene Kent reports tariffs are also a big issue for small business. So this is our sample room. We visited Stella Perez in downtown Los Angeles. Her fashion business, A Cut Above the Rest LA, makes jeans, tops, and dresses, fulfilling orders from clothing brands across the country. The zipper is from China, the button is from China. The only thing that we do here, it will be cutting it, sewing it, and washing it. She says the price of materials and labor have decimated her made in America business. The efforts by the White House to bring manufacturing back to the US, you've had to lay off three workers. Yeah. How does that sit with you? It's heavy because if I get a good contract and they tell me, okay, we're gonna give you 100,000 units to produce, I wanna say yes, but if I cannot keep with that demand, there's no use. You can't fulfill it? No. A June survey found that over a third of small businesses already feel negative impacts from tariffs. Perez says orders for her garments have dropped by about half since last year. She thinks that President Trump's goal of bringing in more manufacturing jobs is an unlikely promise. We don't have that infrastructure. We don't have the manpower of the people that are gonna be sewing all of those goods here. And at the end of the day, it's more expensive. Perez tells us she's surviving month to month. I paid my rent five days ago, and I don't even know if I'm gonna be able to have the doors open next month. Small businesses like Stella Perez's continue to face those high borrowing costs, and that's unlikely to change. The Federal Reserve's July meeting kicked off today, and despite major pressure from President Trump to lower interest rates, analysts expect the Fed to hold rates steady tomorrow. The other big business story today has to do with American railroads. Union Pacific getting ready to spend more than 80 billion to buy Norfolk Southern. So, JoLynn, what do we need to know about that? Maurice, I wanna take you to this map right here. Have a look at this. This is Norfolk Southern in the east connected with Union Pacific here in the west. And if connected, it would create the first ever coast-to-coast freight railway network this country's ever had. Not a done deal. What's it gonna take to make this happen? Oh, this is gonna be a big test on antitrust for President Trump and his administration. Now, these two companies say that if combined, it would actually preserve union jobs and make things faster to ship, but the critics say this could make shipping more expensive. Okay, JoLynn Kent, thank you so much.

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Canberra

Australia expands teen social media ban to YouTube

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Washington

Global Tariffs

Trump says U.S. to hit India with 25% tariff starting August 1

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Birmingham

Ozzy Osbourne fans flood Birmingham streets to mourn late music icon

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Jerusalem

Middle East Conflict

Palestinian activist killed by Israeli settler in West Bank

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Hawaii

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New York

Israel and U.S. boycott UN Summit for two-state solution

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London

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Kyiv

Ukraine Invasion

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Bogotá

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Moscow

Russian official calls Trump's ceasefire deadline 'a threat'

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Zaporizhzhia

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Traverse City

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U.S. Justice Dept. shuts down four child abuse websites

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Bangkok

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Kuala Lumpur

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Stockholm

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Riedlingen

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Athens

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Garfield Township

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Breakdown