Nurseries, Garden Centers & Farm Supply NAICS 444240

Sep 25, 2025 - Tariffs, Labor Costs Pressure Nurseries

• According to a report in the Capital Press, some nursery operations reported slower sales in 2025 due to tariffs, currency fluctuations, and weather, while others, particularly those selling vegetable starts and flowers, saw record growth as consumers sought affordability and self-sufficiency. Oregon remains a national leader, with its $1.22 billion nursery industry ranking third in the US and supplying diverse climates nationwide. Key challenges include labor costs, immigration policy impacts, tariff unpredictability, and rising operational expenses, which may force consolidation among smaller nurseries. At the same time, opportunities arise from homeowners’ continued investment in landscapes, demand for drought-resistant plants, and ecological benefits tied to trees and gardening. Nurseries and garden centers may need to balance cautious growth strategies with adaptability to shifting consumer preferences, global trade dynamics, and regulatory costs while leveraging strong demand for ornamentals, annuals, and sustainable plant varieties.
• The Retail Trade Industry is one of 12 industries reporting growth in August's Services ISM Report on Business. Executives in the Retail Trade industry reported increases in business activity, new orders, prices paid for materials and services, and inventories, along with faster supply deliveries and a decrease in order backlogs in August. Additional industries reporting growth during the period were Information; Wholesale Trade; Arts, Entertainment & Recreation; Mining; Transportation & Warehousing; Educational Services; Professional, Scientific & Technical Services; Utilities; Health Care & Social Assistance; Public Administration; and Real Estate, Rental & Leasing. Four industries reporting contraction during the period were Accommodation & Food Services; Management of Companies & Support Services; Other Services; and Construction. Overall, economic activity in the services sector grew in August for the third consecutive month, with the Services PMI registering 52%.

• Garden center sales were nearly 4% lower in spring 2025 compared to a year ago, but remained ahead of the same period in 2020, according to a Garden Media Group report titled “Garden Pulse: Spring 2025 Analysis” in Garden Center. While the industry faced a challenging environment, including poor early spring weather and tariff-related economic anxiety, consumers continued to view gardening as an essential activity. Garden Media Group President Katie Dubow noted, “Gardening has always been recession-resistant. In 2008, 2020, and now again in 2025, we’re seeing a familiar pattern. When people face financial or emotional uncertainty, they return to their roots — literally.” Frontline sales at independent garden centers were about the same in spring 2025 as they were a year ago and were up 27% from 2020, with high demand for edibles and ornamentals. Early Q2 sales figures appear to be trending even higher, according to data.
• US consumer mood indicators have weakened, signaling potential headwinds for spending. The Conference Board’s Consumer Confidence Index fell 1.3 points in August 2025, with the decline driven by younger consumers under 35, while confidence among those over 55 improved. Meanwhile, the University of Michigan’s Consumer Sentiment Index slipped to 55.4 in early September from 58.2 in August, down 21% year over year. Inflation expectations held steady, but persistent worries about prices and tariff impacts remain. Consumer sentiment and confidence are leading indicators of discretionary spending, which drives two-thirds of U.S. economic activity. A continued slump suggests households may curb purchases and delay big-ticket decisions, raising risks for retailers, service providers, and the broader economy.