Navigating uncertainty: U.S. tech faces challenges under Trump

Gong Zhe is a senior sci-tech editor at CGTN Digital. His views are his own and do not represent the views of CGTN.

As Donald Trump embarks on his second term as president of the United States on January 20, the country's tech industry is bracing for significant change and potential upheaval.

Trump's administration has been known for its aggressive stance on limiting China's access to U.S. technology. This includes imposing tariffs, export controls and restrictions on Chinese investments in U.S. tech companies. Given this history and the bipartisan support for limiting China, Trump is likely to intensify his "tough on China" approach, which could have far-reaching implications for the tech industry in both countries.

The price of consumer electronics like smartphones will likely increase. Although the tariffs are aimed at encouraging domestic manufacturing and reducing reliance on China, they will inevitably raise costs for components and, as a result, for finished products.

Adverse Effects

The semiconductor industry, in particular, could face significant changes. Additional tariffs could further encourage Chinese firms to focus on self-sufficiency, leading to increased competition for U.S. chipmakers in the global market.

Compelled by existing export controls, the semiconductor industry in China saw rapid consolidation in 2024, with over 40 mergers announced covering the entire supply chain. Small companies are uniting and growing stronger.

Some internet influencers even thanked the U.S. restrictions for forcing the Chinese chip industry to upgrade, which had suffered for decades from competition with imported chips.

Visa vs. Talent

The U.S. tech industry may face another blow to its talent pool if Trump maintains his previous approach to the H-1B visa. The denial rate for H-1B visas rose from 6 percent in 2015 to 24 percent in 2018, drawing criticism for making it harder for skilled foreign workers to obtain visas.

Though Elon Musk, the CEO of Tesla and SpaceX, signaled support for expanding the H-1B visa program in Trump's second presidency, he was met with opposition from MAGA supporters, who argue that America has enough talent for high-skill jobs.

Trump's evolving stance

Speaking of Elon Musk, the billionaire who went all-in on Trump during the recent U.S. election, the new administration's support for Big Tech may be limited within Musk's reign.

Trump initiated antitrust actions against Big Tech during his first term. Amazon, Apple, Google and Meta – among others – were targeted by the Department of Justice and The Federal Trade Commission.

But for this second term, Trump may take a less aggressive approach, considering his pressure of boosting U.S. economy, and reduce the prices of consumer goods.

Also, Trump's open support to cryptocurrencies may be a sign of him becoming softer on Big Tech.

For the ongoing government investigations into Google and other Big Tech firms, Trump has never made his attitude clear, claiming he's "not a fan of Google" but also saying it's not necessary to break up the company.