 "Trump promised 'golden age' for America, jobs data show economy is 'flashing yellow'")
President Donald Trump promised to usher the United States into the 'golden age'. But all economic metrics suggest the country is headed towards a dark age in the absence of course correction — job growth has reduced to a trickle, inflation has risen, manufacturing has fallen, and recession odds have risen.
In August, the US economy added just 22,000 non-farm jobs compared to the projection of 75,000 new jobs, the unemployment rate rose to a nearly four-year-high of 4.3 per cent, and the manufacturing sector grew at the slowest pace in 10 months.
The Institute for Supply Management’s Purchasing Managers’ Index (PMI) for manufacturing rose to 47.2 in August from 46.8 in July, which was the lowest growth since November 2024. A PMI below 50 shows contraction and above 50 shows expansion. The PMI last month stayed below 50 for the fifth straight month.
Trump hits his own base the worst
Such an economic deterioration that Trump has presided over has delivered biggest blows to his base of blue-collar workers and industries that he vowed to encourage in his term. Trump’s base is not just dealing with falling job creation and manufacturing’s downfall. But they are also dealing with layoffs.
In August, layoffs were among the highest in the goods-producing sectors most exposed to Trump’s trade disruption, with manufacturing, construction, and energy and mining losing around 25,000 jobs, and wholesale trade losing 12,000 jobs, according to Financial Times.
The economic data is “pretty sobering” and that the economy was now “flashing yellow”, according to Erica Groshen, a former Bureau of Labor Statistics (BLS) commissioner under President Barack Obama.
“What we see is that the US economy is essentially not creating jobs. The three-month average change is 29,000, which is basically zero for an economy of the size that we have,” Groshen told FT.
Impact Shorts
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Even though Republicans are not criticising Trump, surveys show that the majority of Americans disapprove his handling of the economy. The Real Clear Politics’ polling average shows that 54.1 per cent of Americans disapprove of Trump’s handling of the economy.
Even as Trump has continued to blame the poor economy on President Joe Biden, his predecessor, and has said the BLS’ data is fake, the blame for the economy rests with his him and his policies that range from tariffs to mass-firing of government employees.
Trump’s tariffs have hiked costs for importers and therefore prices for consumers have gone up, his immigration crackdown has made it harder for many industries like farming, hospitality, and food processing, to find workers, and job growth has further fallen as there is little need for more workers because consumers are buying far fewer products because of increased prices, and Trump’s administration has directly added to unemployment and declining sales by firing tens of thousands of government employees and affecting production by cancelling several government contracts.
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