Signs of crisis in the US economy: Where are all the jobs?

Job growth in America has weakened. The unemployment rate has reached the highest level not seen in years and wage growth has slowed. Importantly, Manufacturing sector has cut jobs That’s despite tariffs for seven consecutive months, which were expected to boost U.S. manufacturing jobs.

“What we’re doing is not working,” said Justin Wolfers, an economics professor at the University of Michigan and a senior fellow at the Brookings Institution.

Wolfers says since Trump imposed the tariffs on April 1 67,000 jobs have been lost in the manufacturing sectorAnd he says the reason is clear,

“The President implemented some policies that were quite harmful to the United States. And the United States economy has performed very badly. So that part sounds pretty straightforward to me,” Wolfers said.

A 50 percent tariff has been imposed on Canadian steel and aluminum. So any US company using that steel to make products will either have to find a new source, pay the tariffs or make do with stockpiled imports before the tariffs take effect.

Automakers have complained that the tariff arrangement will cost them billions of dollars.

debate on economyThe impact of Trump’s tariffs has been growing since his election last November.

Critics say the tariffs are a tax on imports, paid by American companies, and will ultimately slow economic growth.

The Trump administration has repeatedly rejected thiscap argument. It is sometimes said that tariffs are paid by foreign countries (even if it is acknowledged that the bill is ultimately paid by American companies). But it has steadfastly claimed that the president’s economic policies will lead to a golden age for American workers.

“Simply put, President Trump’s big beautiful bill will free up our economy and deliver a blue-collar boom,” the White House wrote in a news release in June.

Only last week, Trump was asked to grade the American economy.

“A-plus,” he said.

“A-plus?” asked Dasha Burns, host of the podcast The Conversation.

“A-plus-plus-plus-plus-plus,” Trump said.

The administration has consistently dismissed concerns about high inflation and affordability as “hoax” and “hoax”.

Loss to public sector, profit to private sector

And In a news release after the jobs numbers were released, The White House focused on the fact that all the jobs lost were in the public sector, while on average private sector payrolls expanded.

The White House is not wrong. The deficit was actually concentrated in the public sector as the Department of Government Efficiency (DOGE) layoff payments were mostly paid by the end of October.

But the bigger picture – in which job growth remains slow – went largely unnoticed.

“The strong jobs report shows how President Trump is repairing the damage caused by Joe Biden and building a strong, America First economy in record time,” the White House wrote.

The problem is that almost everyone agrees, jobs Figures released this week At best, incomplete.

During the 43-day government shutdown, statistical agencies were not collecting the kind of data they normally would.

Typically, government employees go to specific stores and compare the unit prices of a huge basket of goods to measure inflation. Others will call American families and ask if they are working or looking for work.

Nothing like this was done during the bandh. As a result, there is a kind of fog over the data for October, November and even parts of December.

“It may be several months before the signal from public sector layoffs, an unprecedented increase in policy uncertainty and noise about a government shutdown fades away,” wrote Carl Shamotta, chief market strategist at financial services firm Corpe.

What is known for sure is that The jobs market slowed down this summerAt the same time inflation started rising again.

We do not know whether these trends continued, accelerated or improved during September, October and November.

Weakening job market

Economists and policymakers alike are concerned that if things got worse, the data currently available may not fully capture those changes.

“Historically, the U.S. job market has not softened quietly and quietly. It has weakened aggressively and suddenly,” said Francis Donald, RBC’s chief economist.

But, Donald says, we can only work with the information available.

And this week’s weak data suggests that the job market has weakened a bit.

Wolfers are saying this was coming for several months. And he says it’s not just about Trump’s tariff policy.

“What’s happening in the United States is not surprising. It’s an incoherent, chaotic policy process that has led to widely discredited policies and undermines consumer and business confidence and the trust of people around the world,” he told CBC News.

He points to immigration policies, the fact that Trump has projected a $1.8 trillion deficit by 2025 and has a long, established history of changing his mind without notice.

Wolfers says none of this inspires confidence in consumers deciding where to spend, businesses deciding how to invest and foreign companies looking for new markets.

“It’s not surprising that it will have some impact on the U.S. economy and that it will be negative,” Wolfers said.