The news: Multiple forecasts are concerned about US advertising growth in 2025 as economic uncertainty grows.

• Our own forecast, which will be published later this month, will see US total ad spending growth of 6.3%, down from 7.5% in our previous (November) forecast.
• Ad spend is projected to rise just 3.6%—down from the previously forecasted 4.5%— according to a new forecast by Madison & Wall.
• The Interactive Advertising Bureau (IAB) found that 94% of US advertisers are concerned about the impact of tariffs, and 45% plan to cut ad budgets as a result.

Zooming out: The slowdown comes amid rising inflation, trade uncertainty, and supply chain disruptions that are adding new pressures on marketers.

• Retail and consumer electronics are bracing for the biggest cuts. 40% of retail/ecommerce brands and 33% of consumer electronics advertisers in the IAB study anticipate budget reductions, with media & entertainment (28%) and automotive (26%) following close behind.
• Social media (41%) and traditional media (43%) are expected to take the largest spending cuts, while linear TV, gaming (24%), digital display (20%), and podcasts (16%) will also see declines.

When will it happen? The biggest spending pullbacks are likely to occur in Q2 (34%) and Q3 (37%), as advertisers react to mid-year economic shifts.

• Tariffs are accelerating ad budget cuts. More than 60% of advertisers expect a 6%–10% decline in budgets, with 22% anticipating reductions of up to 20%, per the IAB.

Yes, but: Digital advertising continues to gain market share despite economic concerns, with projections that it could account for up to 79% of total ad spend by 2030, per Madison and Wall. The advisory firm estimates that digital ad spend is only at 67% of total spend this year.

Analyst insight: A key concern is the $9 trillion in US debt that must be refinanced within six months, notes senior forecasting analyst Andrew Spink. That’s a challenge that could either burden taxpayers or force the government to push the economy into a recession to lower interest rates.

• Ongoing tariff negotiations are fueling market instability, with Wall Street increasingly pricing in a recession for 2025.
• If policymakers can manage a controlled slowdown to bring down rates, the impact on ad budgets may be moderate. However, a full-scale recession combined with persistent tariffs could result in deeper cuts by year-end.

Our take: Advertisers should expect a highly volatile 2025, with tariff-related uncertainties and economic shifts influencing budget decisions mid-year.

• While digital platforms continue to dominate, traditional media and social platforms will need to adjust to shrinking ad investments.
• For marketers, flexibility in media buying and investment in AI-driven efficiency will be key. Those who can optimize spend, focus on performance-driven channels, and leverage automation will be in the best position to navigate the year ahead.

Go further: Check out our Live FAQ: The Impact of Trump’s Tariffs on Consumers, Businesses, and Trade.