July Jobs Report: A downward slide

With the release of the July Jobs Report from the US Labor Dept. on Friday there was an unexpected dip in the number of non-farm jobs for the country, a departure from what economists expected, and one that some have said was bound to happen with the economic uncertainty brought by the on again, off again tariffs from President Trump. In response, employers have been reluctant to hire new workers, but Trump has said, "The good news is that tariffs are bringing billions of dollars into the USA.”

In total, there were 73,000 jobs created, but one of the more revealing, and controversial, aspects of the report was the downward revisions for May, and June, a natural occurrence due to the collection period by Labor, specifically the Bureau of Labor and Statistics; but, these revisions were more severe than prior reports have shown: for June, 14,000, and for May 19,000, giving an overall picture of a declining, but not dismal, picture of the American jobs market.

“It’s hard to pull the trigger on hiring when you’re uncertain about where tariffs are going to land,” said Diane Swonk, chief economist at KPMG, to The New York Times.

Trump, who pegged much of his election campaign on increasing jobs for the US, was furious, and fired the BLS commissioner, saying without evidence that Dr. Erika McEntarfar, a Biden appointee, had rigged the numbers to make him look bad, and that she would be replaced for someone that would provide more accurate numbers.

Moving away from that controversial firing, this report was not entirely unexpected, some say, considering the uncertainty that has roiled both the domestic and the global financial communities, and the effect of tariffs on the American consumer, the main drivers of the economy. And, if there is a pull back on spending, then the consequences will be significant, but currently, with the average wage increasing by 0.3 percent, and reaching a total for the year of 3.9 percent, and $36.44 for July, it exceeds the rate of inflation of 2.8 percent, so consumer spending has not taken a nosedive.

The banner rate of unemployment was 4.2, a tad above the previous rate of 4.1, and the labor force participation rate was little changed from June, at 62.2 percent; and, while this is a closely watched figure by economists and legislators, future monitoring will be increased to make sure that there is no need of a fix, by either the Federal Reserve, or market enhancement tools.

What has become problematic is that the Trump administration has not made clear what the end goals are for tariffs, and for global markets, using his April calculations (which many economists question) could interrupt trade relations with some of America's closest allies, such as Canada, Mexico; not to mention the European Union, whose recent acquiescence has increased their tariffs from a previous low of 2.5 to 15 percent, but leaving a 50% tariff on steel and aluminum, components that are featured in many consumer goods for the US, not only cars, but appliances such as washing machines and refrigerators, to name but a few.

For those countries that have not negotiated with Trump they face even higher tariffs, up to 35 percent on August 7.

Switzerland, whose exports reach the US in luxury watches, chocolates, and components, such as the above, and who claimed a close trading relationship with them, was hit with a baffling 39 percent, slowing trade, and creating a probable black hole for later trade agreements; but, hitting the market for luxury goods among wealthy Americans.

Consistent with earlier reports the heavy hitters are: health care at 55,400 jobs, retail at 15,700, and leisure and hospitality at 5,000; but the demise of manufacturing and construction have continued, as both industries struggle with tariffs and supply chain issues, coupled with the high cost of building housing, in an underperforming area, 11,000 and 12,000 respectively.

Well known, but now firmly established is the loss of 12,000 federal jobs resulting from the earlier firings, orchestrated by presidential advisor Elon Musk, and the Department of Government Efficiency, which had been previously thought to have swelled the ranks of local and state governments, but with the revision are far less.

Reaction from economists has been swift, and Olivia Allen, senior economist at Parthenon, said, “After this report, it doesn’t look like a particularly healthy job market,”

Overall, job growth has not kept up with population growth in the US, and 80,000 to 100,000 are needed, noted Laura Williams, director of economic research for North America, at the jobs site Indeed.com, reported CNBC.  In fact, the country has only created 106,000 jobs since May, “a three month total barely enough to sustain the labor market.”

Cost of goods,specially groceries, were a deep concern for consumers when inflation was near 9 percent, and while it has come significantly down, there are still concerns, especially when Trump was running for his second term, and said, in effect, everything was going to be cheaper, a promise that he found difficult to keep, and admitted after 30 days in office, that it was harder than he thought.

Egg prices, that bugaboo in the run up to election day, have come down by 23.8 percent because of successful attempts to tame bird flu, and separate healthy chickens from sick ones; gasoline is up partially due to summer demand, but also varies according to the price of crude oil, and formularies used both in production and distribution, with an average per gallon price of $3.49, relatively tame by those standards.

Grocery prices do vary, by region, and retailer, but core inflation which strips out volatile gas and energy products is up from January to June by 0.8 percent; and, while some areas might not be affected, depending upon income, lower income families may be the most challenged, especially with the shortage of affordable housing, and congressional cuts to the Supplemental Nutrition Assistance Program, and taking into account that grocery prices are up 0.6 percent, according to the CPI report from BLS.

The Budget Lab at Yale University has predicted that with the Trump tariffs groceries will increase by 3.7 percent in a year, or two; and, 3.2 percent over the next 5 to 10 years.

The moves of the Federal Reserve in their recent meeting, has kept the interest rate of 5.33 percent, citing, once again, economic uncertainty of the Trump tariffs, much to the ire of the president as he has continued to excoriate Chair Jerome Powell, calling him on Truth Social, “Too Little, Too Late Jerome” and has wavered between name calling, or threatening to fire him; and, recently, attacking him for cost overruns on the Reserve building, conflating a five year old project with a current renovation; all designed in an effort to discredit him, since the Supreme Court has said that he cannot be fired.

Powell stated last Wednesday, “If you move too soon, you wind up maybe not getting inflation all the way fixed and you have to come back. That’s inefficient. If you move too late, you might do unnecessary damage to the labor market.”

There seems to be no predictable end in sight for the American economy, and employment stability; and, together with tight global markets makes for a very worrisome economic future, plus with politicization on the forefront, the risks for consumers are enormous.

Mamdani surge might energize Democrats

When Illinois Gov. JB Pritzker announced that he was going to run for a third term as Illinois governor, local tongues began to wag, and ponder, was he giving up presidential ambitions, or was he using this as a time to solidify his national reputation, after a series of appearances, and blunt criticism of Donald Trump, who in turn, has openly criticized him, and calling him names.

Pulling back from the optics, and the rhetoric, with the Democrats sidelined by the juggernaut of the second Trump administration, it’s going to be tough sledding for them as they attempt to make a comeback, and while it’s been done before after being in the weeds, notably with the election of Bill Clinton; but, they have faced an onslaught of bad publicity, which was ratcheted up when Joe Biden stepped aside, and Vice President Kamala Harris stepped up from the bench, to keep the presidency in Democratic hands.

As we once noted about the failed campaign of Hillary Clinton, the book has not been written on that loss, but we did offer a post mortem, of sorts, shortly after her defeat, it’s now safe to say that Trump won in no small measure by appealing to many of the fears and cultural concerns about Brown and Black people, immigrants, and especially trans people.

In short, the Democrats have a bad reputation, with the reality of Trump’s command of the culture wars in America; and, while some conservative positions  had gone underground after the Reagan years, only to reemerge decades later, Trump brought them forward in a defense of traditional values, and pilloried attempts, starting with the bathroom wars, by others to support these populations.

The great American culture figure, Will Rogers, once famously said: “I belong to no organized party; I am a Democrat.” Aphorisms aside, that may be the central question. What do they stand for? Who can they appeal to?

Framing those questions has become the $64,000 question, and Pritzker raising his national profile, stating pride in defending diversity, affording equality in education, and gender diversity might not win him points with the right, or even the extreme left, but, entering the fray in the city that defines much of urban America, comes Zohran Mamdani who beat out disgraced former New York Governor Mario Cuomo, in the recent city primary, And, in a city like New York, the shock was akin to the election of  American Bishop Robert Prevost to the papacy of the Roman Catholic Church. 

All roads might have once led to Rome but can the tables be turned to allow a 33 year old Ugandan born Indian with an unwieldy name to take on the most embattled and diverse of American cities, Chicago excepting? And, also one that has previously eaten and spit out lesser mortals as they attempt governance. 

Two parts of his plank that have warmed the hearts of New Yorkers are the “bread and butter” issues of historically high rents, groceries, and fears of subway crimes, to mention just a few. The response has been overwhelming, and it’s also notable for the absence of hot button cultural issues, perhaps echoing Abraham Lincoln’s famous words of a house divided cannot stand.

One significant factor is Mamdani’s attraction for younger voters, and as NY Mag reported a Marist poll gave Mamdani a 34 point lead, “among voters under 45”. Coupled with a younger turnout, “voters 25 to 34 have been the largest share of early voters among any age cohort, making up one quarter of the early vote with voters under 45 comprising almost half the early vote.”

If retail politics rule the day, then Mamdani walking from one end of Manhattan to the other, video crew in hand, before the Friday primary election, while his much older opponent, Cuomo, was reticent to reveal his schedule, speaks volumes to a new day dawning for a younger, physically abled candidate which has not been seen in the last three presidential elections cycles; and, while this is a presidential election, it does give a sharper edge to how a Democratic candidate might perform on the national stage.

What might be held against him is the label of Democratic Socialist which might need clarification for some voters, especially if elected and a crop of similarly identified voters are also running for office; but, then again, we've seen this before nationally, with the run of Bernie Sanders, and his socialist tag that joined a debate about who was more progressive, a battle never won.

Then in 2019, there was a presage of sorts with mayoral elections in Chicago, that prompted The Economist to note the upswing in aldermanic races with a surge of Socialist Democrats to state, “Looking past the label, however American socialists are more progressive Democrats rather than Castros in waiting, and their rise poses more of a challenge to the Democratic Party than to capitalism.”

We may see that again, and already with the anti immigration efforts from Trump, he has already, along with others, been talking about Mamdani’s status as a naturalized citizen, and either deporting him, or denaturalizing him, a lengthy process that could rattle his primacy.

Up for grabs, in any local, or national election is the Black vote, something that has factored into the success of any Democratic president since the 1960s, and in the last presidential election played a role in Trump’s victory where more Black men, younger, voted for him giving him a decisive edge.

If we take a look at Mamdani and his voters we see that, early as it is, “young Black voters appear to have gone decisively for him in the NYC primary. According to one primary exit poll (with a small sample size), about 70 percent of Black voters under 50 voted for Mamdani citywide,” according to The Intercept.

For a national candidate, the focus on bread and butter issues can take a sharp turn towards success. but despite accusations of taking the Black vote for granted, the future for Democrats may have to take a turn from traditional transactional strategies to recognizing that Black communities are not monolithic.

It’s apparent that for voters youth matters, and while younger Black voters are turning out for Mamdani, there is also a surge within Democratic circles for Patrick Roath, a young 38 year old candidate vying to win a House seat from incumbent Stephen Lynch, 70, who some voters feel is not only youthful enough, but not as progressive as they need, or desire, as a force against Trump.

Roath, much like Mamdani, is pushing hard for those same “bread and butter” issues that he feels are most important for voters in Massachusetts, such as affordable housing access to jobs. but also to return and redefine the issues for Democrats, admittedly no small feat, in and of itself. 

While some may see this as a way to regain the ground lost in 2024, a return to party roots, Rogers infamous quote aside, may have some traction, especially in the midterms next year, and especially as the president is coming under close scrutiny for his alleged involvement with pedophile Jeffrey Epstein, a story that seems to have legs, to use the old newspaperman jargon.

That  aside, considering Roath as an example, there may be some good old fashioned youthful New Frontier “vigah” for his campaign, than establishment stalwarts such as Pritzker.

Part and parcel of Roath’s energy comes also from his moral outrage of the Trump detentions, and deportations, of undocumented immigrants, as the administration attempts to meet a goal of 3,000 deportations each day.

When we take a look at the high cost of housing, especially on the  East Coast as well as across the nation, voters may wonder why this is not a priority of the president. Then add healthcare, or more specifically, the potential loss of 11 million Medicaid recipients from “The Big Beautiful Bill” passed by Congress, then the die may be cast for a path forward.

Still there is some pushback against youth as a factor, and in an interview with WBUR, Bill Curry, a former member of the Clinton administration and Democratic veteran, seemed wary of a “bright and shiny” new candidate, and wants to stress past Democratic legislation, and achievements.

He said that there needs to be more than youth, but instead a return “specific asks” citing past successes such as Civil Rights, for Black Americans, backlash to the Watergate scandal, to jump start the push back against Trump.

June Jobs Reprt: Solid as a rock say some, others?

Holding strong the US Jobs report, released on Thursday, just before Independence Day by the Labor Dept. once again showed strength and resilience despite the “on again, off again” threat of tariffs, and, indeed, exceeded the expectations of most economists, with 147,000 non farm jobs when only 117,00 were expected.

The unemployment rate held steady at 4.1 percent, but  labor force participation was little changed at 62.3.

“You’re not just seeing any feed through for the tariffs as trade related stress,” said Joe Brusuelas, RSM chief economist to Yahoo Finance, and added, “We’ve got an absolutely solid payroll number,” but also gave this cautionary note, “This feeds right into the forecast of a slowing but solid economy.”

There is still economic uncertainty promulgated by President Donald Trump with his tariffs, first announced in the White House Rose Garden, on the so-called Liberation Day, albeit with the fuzzy math that international economists have criticized; and, all of which has not only caused consternation abroad, but for American consumers, the main drivers of the US economy, as they navigate prices from wedding gowns, (most of which are made in China), as well as steel, (ironically used to build Trump properties) and tariffs on aluminum that threaten a supermarket staple: canned goods.

All things considered equal, US employers have held back on hiring, but not enough for a deleterious effect, and with a steady hand on the tiller, the captains of industry are navigating threatening waters.

That aside, wages were up for June by 0.2%, an increase of 37 percent, which, for middle to high income earners allows them to deal with inflation, currently at 2.7 percent.

Overall what we are seeing is a smaller, but still robust, labor market that, much to the disappointment of Trump, will not allow for a rate cut, but as Priya Misra, a portfolio manager at JP Morgan Chase Asset Management told The New York Times, “There is no urgency, they can keep pushing it into the future.”

Stephen Miran, Chair of the White House Council of Economic Advisors, was ecstatic in the news as well as damning administration critics, when he stated, “Once again proving that the haters and doom sayers don’t know what they’re talking about.”

As reported in the past few months, the heavy hitters are local and state governments with 75,000 jobs, whose numbers may be possibly swollen from those approximate 69,000 federal workers sacked by Elon Musk and his DOGE team; leisure and hospitality at 20,000, education and health at 51,000 and construction increasing to 154,000.

Feeding the national trend with online shopping, transportation and warehouse jobs are holdings steady at 75,000,

The losers? Manufacturing which lost 7,000 workers, and who in April lost 1,000 jobs, and whose losses are caused by a myriad of factors: disturbances in the global supply chains, trade disputes, and tariffs, but also by American manufacturers who invest far less in process innovation, as do other countries, for example, Japan, who has invested, on the main, 55 percent more than Americans have, at last count 23 percent.

Taking a look at overall economic growth there are estimations of only 0.1 percent and 13 percent growth on a year to year basis, while other corporate think tanks, accounting firms, and private investment firms predict slower growth over the next two years, beginning this year between 1.5 percent and 2 percent; with much of that attributable to lowered consumer spending, business investment, and government policy, up to and including tariff policies.

The hits to the GDP (gross domestic product) are predicted to drift downwards by the fourth quarter of this year, with some predicting a recession, and by 2026 a fall to 1.7 percent.

Latest news on tariffs from the Trump administration is that ahead of the July 9 deadline letters will be sent to at least 100 countries that if they do not meet that deadline for trade negotiations, tariffs will revert back to the April 2 rates, between 10 and 50 percent, according to Scott Bessent, US Treasury Secretary, in an appearance Sunday on CNN’s “State of the Union.”

While it’s been long known that Trump is not a globalist, the results would further sever not only relations with foreign markets, and increase prices for their goods in the US.

Of course, the biggest news from the administration is that Congress approved is “Big Beautiful Bill,” his term, a signature piece of legislation that encompasses gnarly everything the president wants to achieve as part of his economic and cultural legacy, including making permanent the 2017 tax cuts, that mostly favor the very rich, with only modest income increases for the lower and middle classes.

The greatest concern among administration critics, including Democrats, is that to cement the expiring his 2017 tax cuts, the revenue needed to create them will be taken from a reduction in Medicaid to approximately 11 million people, and whose work requirements for certain recipients, seniors excepted, or volunteer work, and whose monthly reporting may prove onerous, especially to those tech challenged, or without access to the internet to file those reports may find themselves dropped and, the result will see a greater reduction in program coverage.

This coupled with cuts from the Supplemental Nutrition Assistance Program (SNAP) increases revenue enhancement, but will affect individuals, and families, especially those living in states with Medicaid expansion and in combination with the Affordable Care Act, has supported the health care needs of adults, and children, especially those with special needs, both developmental and genetic.

The result is that for those in these groups, their monthly budgets, already stretched thin, will be so even further as they attempt to fill the holes, and pay rent, or mortgages; despite the president stating that a family of four will gain at least $13,000 per year from the passage of this bill.

While economists disagree with him, and point to an assumption of an increase in the GDP, this bill can also affect employment in rural hospitals, since many may close, creating job loss; plus a crisis of care additional costs of care that might not be met by Medicaid, even if some remain open. Joining that concern is that one out of every four people in rural America are on Medicaid.

The biggest result of the bill, originally HR 1 from the US House of Representatives, adds a huge deficit to the US economy, as Factcheck.org noted in early May:

“The bill is certainly not the largest deficit reduction in nearly 30 years – it’s not deficit reduction at all,” Marc Goldwein, senior vice president of the nonpartisan Committee for a Responsible Federal Budget, told us in response to Leavitt’s claim. The increase to the deficit over 10 years will be $3.1 trillion with interest, according to CRFB’s breakdown.”

In response to the stated benefits from The White House, from Press Secretary Karoline Leavitt, they added, “The Tax Foundation, for instance, concluded, based on the version of the bill passed by the Senate Finance Committee, and accounting for the economic growth expected to be spurred by the bill, that the percentage change in after-tax income increases — on average – as income rises. For example, in 2034, those in the bottom 20% of earners are expected to see a 0.5% increase in after-tax income. That percentage increases to 2.6% for the next 20% of earners. Those with incomes in the middle 20% — who earn between $38,572 and $73,905 — would see a 3.5% increase in after-tax income in 2034. The largest increase — 3.7% — would accrue to those in the top 20%, the Tax Foundation said.”

In a further analysis of the aforementioned lower income population, “The Penn Wharton Budget Model looked at the effect of the Senate version of the bill on lifetime income, and factored in the effect of cuts to Medicaid and food assistance. Using a model that takes into account the expected economic growth from the plan, the PWBM found, “that households most affected by the cuts to Medicaid and SNAP — those in the bottom income quintile — experience the largest losses under this bill, averaging $27,500 in lifetime value for the working-age population.”

If the “Big Beautiful Bill”, or B3 as some has dubbed it, was the biggest news over the holiday weekend, then it bears looking at the role of the Federal Reserve, principally its chair, Jerome Powell who Trump has attacked over not lowering interest rates, and sending him damning handwritten notes and also with floating the idea of a shadow chair, possibly Bessent.

We have noted, over several reports over many months, that Powell is data driven and the data and the role of interest rates is dependent on macro economic basics, not political desires. And, one of Powell’s concerns, and data points, are tariffs, especially in their uncertainty; and, especially now with Bessent’s announcements, and effects on consumer prices, which history has shown, will see an increase.

May Jobs Report: Still solid for the US

The jobs outlook for May, according to the US Dept. of Labor is still strong despite the threats of the tariffs from the Trump administration, and despite a slight softening from the previous month, and what was expected 139,000 non farm jobs is still a solid report and one that has surprised many observers, and economists, and despite expectations did not show a downturn from these tariffs.

This good news shows that despite the politicization of the American economy, all is well, and gave rise to accolades from the Administration, and The Council of American Advisors Chair Steve Miran, noted, "The President is succeeding in creating hundreds of thousands of jobs since he came into office, more than half a million jobs since he came into office, and they’re all going to native born Americans.”

The unchanged rate of 4.2 unemployment was also satisfactory, although predicted, but what changed was a lessening of the labor force participation rate among prime aged workers, those aged 25 to 54, who were looking for work, which dropped to 83.4, betraying, perhaps, a lack of confidence from Americans.

That stands in contrast to the average wages, that exceed inflation, which rose 0.4 percent from April, now at $36.24 an hour; and, even further American consumers are still spending, perhaps in no small measure to the increased wages, but, as some observers have noted, that spending may be to save money on goods to avoid the “on again off again” tariffs from the president.

Consumer confidence has waxed and waned in the last 8 weeks, with concerns about tariffs, and layoffs, but The Conference Board reported for May, that consumers were feeling more upbeat than thought:

“Consumer confidence improved in May after five consecutive months of decline,” said Stephanie Guichard, Senior Economist, Global Indicators at The Conference Board. “The rebound was already visible before the May 12 US-China trade deal but gained momentum afterwards. The monthly improvement was largely driven by consumer expectations as all three components of the Expectations Index—business conditions, employment prospects, and future income—rose from their April lows.”

They also emphasized this: “However, while consumers were more positive about current business conditions than last month, their appraisal of current job availability weakened for the fifth consecutive month.”

If this seems like a conundrum, then it is, with indicators expressing some level of confidence, and some improved beliefs, but, perhaps cautiously optimistic might be the best estimation.

The New York Times opined that, “The steady hiring is an indication that businesses are still seeing enough demand for goods and services that they will fill open roles and add new ones, even if they're no longer expanding as quickly as they had over the past few years.”

To note, for May, as seen in preceding months, the heavy hitters are health care jobs, coming in at 78,000 and leisure and hospitality at 48,000; but while others fell flat, manufacturing took a nosedive to the tune of 8,000 jobs.

DOGE cuts to the federal work force disposed of 22, 000 federal jobs in May, and according to the Times report, "down 59,000 since January. That’s not counting those on administrative leave, or who were let go when federal contacts were cut.”

It should be mentioned that a significant reason that health care is booming is due to an aging population in the US, coupled with social assistance, a broad category that includes, social work, allied health and community based programs from local and state governments.

This has not quelled the worries of Main Street, as well as Wall Street, since uncertainty is the one thing that both do not like. How that bodes for the future is anyone’s guess since no one can determine with any certainty what the end game is for the Trump efforts, is it a negotiation tactic? If so, that does not seem evident, as we noted some months ago covering the “Liberation Day” announcement in the White House Rose Garden, and the placard showing tariff rates held aloft by the president, that most experts discounted as fanciful.

The intersection with the global community cannot be discounted as it affects not only consumer purchases, but in the larger scheme, foreign trade, underscoring the fact that no country can produce all goods,(and even services) domestically.

The fly on the wall, at least according to statements from Trump in his social media platform, “Truth Social” and statements from White House press secretary, Karoline Leavitt, is that he is upset with Chair Jerome Powell of the Federal Reserve, and has labelled him as a “disaster” and nicknamed him “Too Late” in his refusal to drop interest rate, as the Chair has steadfastly tried to separate the bank’s behavior from politics.

Trump’s beliefs are also supported by Vice President JD Vance who seems not to understand the role that interest rates, and putting more money into the economy curtail, all tied to inflation; and, how when there is too much money in the economy, leading to inflation, higher rates cool the economy down, and when lowered are needed, to stimulate the economy.

The current rate of inflation, 2.3, does not indicate a need to lower interest rates.

In a note to clients, and reported by the Times, Lindsay Rosner of Goldman Sachs Asset Management, said this report was too strong to warrant the Feds to cut interest rates, and, “with the Feds laser focused on managing the risks to the inflation side of its mandate, today’s stronger than expected jobs report will do little to alter its patient approach.”

April Jobs Report: Rinse and repeat

The April Jobs Report issued on Friday from the US Dept. of Labor was a solid report that gave 177,000 non farm jobs, an unexpected jump from the 130,000 predicted, and with an unemployment rate of 4.2 holding steady it seemed to be a surprise to many observers, especially economists, and many US residents, most of whom were expecting a steep decrease with the news, for months, of federal job cuts from the Department of Government Efficiency led by Elon Musk; but, those numbers are not reflected in this report, since those cuts predated the April data collection.

If March’s report was the calm before the storm, then this is a continuation of the same, and most importantly with the “on again, off again” tariffs promulgated by President Trump in his series of economic injunctions by executive order, as his tool, and not through Congress, the future of the US economy remains uncertain. 

Indeed economic uncertainty has dominated the country for the last 100 days, and there have been steady predictions of financial doom, and fears of a recession; and, taking them in their entirety, there is just cause to worry, as the effects would be born by American consumers, especially lower income families who, as we noted last month, face increased expenditures of at least $1,200 each month.

Trump, however on Friday, reacting to the report, characteristically, remarked, “Just like I said, and we’re only in a TRANSITION STAGE, just getting started!!! Consumers have been waiting for years to see pricing come down,” 

The Hill reported an anomaly cited by Trump when he added that “prices for gasoline and groceries were already far lower than federal and private-sector data shows.”

That aside, April showed consistency across key factors, such as labor force participation, racial and gender employment.

Areas that held strong were health care with an increase of 51,000; transportation and warehousing at 29,000; and, financial activities (a loosely defined category) with an increase of 14,000 job gains.

Especially notable was that there was no significant change in construction and manufacturing, coupled with LFP at 62.6 percent.

“Another stronger than expected jobs report is encouraging, although definitely not top of mind considering the ongoing uncertainty around tariffs and global trade,” Joe Gaffoglio, CEO and President at Mutual Of America Capital Management, wrote in a commentary, and reported by The Hill.

“While the labor market continues to be a bright spot, that could change quickly if the imposition of tariffs leads to disruptions in supply chains and global trade.”

Future tariffs, now, on Monday focusing on “foreign” made films, looming chaos for the American economy continues, but will also roil European markets, as well; and, with holiday retail buyers looking to fill the stores for the Christmas holiday, it is unlikely to be good news, especially since 80 percent of toys sold in America are made in China.

Trump has stated that girls may get two dolls instead of 30, this Christmas, and that they might cost more, scant consolation for parents, who are also facing higher housing costs, despite average wages for April coming in at $36.06, representing a 0.2 wage increase, and for the past year is up 3.8 percent, but, while that has kept up a solid pace overtaking inflation since mid 2023,” most working people do not feel positive about their future.

If perception is three tenths of the law, that wage increase may not mean much, and with many people believing that the American president controls and sets prices on groceries, and gasoline, the president may be in a crunch, and while his base has remained loyal, for the most part, recent polls show that between 52 and 53 percent of Americans believe that his handling of the economy is weakening their support.

Food prices are rising and a trip to even discount grocers show price increases, and the Dept. of Agriculture predicts that “food costs will rise faster than the historical average this year.” 

With many food imports coming from Mexico and other foreign markets, tariffs will increase those costs, especially for discount super markets such as Aldi, who rely on foreign imports.

As The New York Times stated, “The vast majority of data analysts say the eventual effect of President Trump's high tarriffs on the labor market will be fully appreciated in the weeks and months to come, Still, the early impact is reverberating through financial markets, global freight patterns and corporate business plans.”

Currently, and this is a qualifier, as Trump has shown in his previous administration, a propensity to change course, they include 145 percent tariffs on China and 25 percent tariffs on Canadian and Mexican products not covered under the North American trade agreement.

There is a conundrum with the emphasis being on goods, yet the US economy is increasingly oriented “around services, which constitute about 70 percent of U.S. commercial activity,” said the Times, while noting that “good purchases still make up a major chunk if household spending, and more than 40 percent of U.S. manufacturers rely on imported parts or finished goods,” and we see this especially in the auto industry that has serious fears that their profits would be greatly diminished by the Trump tariffs.

The Times reported on Monday that, “The Trump administration has levied 25 percent tariffs on imported vehicles and auto parts. It has raised tariffs on imported steel and aluminum, which are used extensively in cars and trucks.”

Retaliatory tariffs are likely, and Ameicans can expect to pay more for a new car, and already there were long lines to buy new cars before the tariffs took effect, especially for foreign made vehicles which are 50 percent of those sold in the country.

The iconic American car maker Ford announced a profit loss, as reported by the Times, when they said, “Ford Motor said on Monday that the Trump administration’s tariff policies were likely to lower its 2025 profit, before interest and taxes, by about $1.5 billion. The company also dropped its forecast for the year, saying that predicting the future had become too hard.

Ford is less affected by President Trump’s 25 percent tariffs on vehicles than other automakers because most of the vehicles it sells in the United States are made in the country. General Motors said last week that the tariffs would increase its costs $4 billion to $5 billion this year.”

“This is a major shift in U.S. trade policy, especially as it affects trade between the United States, Canada and Mexico. For decades, cars and auto parts have been shipped across North America with little or no tariffs”, added the Times.

There is great fear “that consumers will cut back so aggressively that business will be forced to lay off workers, worsening the economic slowdown,” and with the triple digit tariffs on goods coming from China, a boon for lower income individuals and families, those bargain clothes, coming from Chinese companies such as Temu, Shein and AliExpress, increases affordability, as we noted in our March analysis, quoting an earlier news report, from the Times, acknowledging that while cheap Chinese goods do hurt American manufacturers, these lower priced goods, “are in effect a pay increase, leaving consumers with more money to spend on goods and services.”

The American consumer, the established driver of the economy, is already adjusting their buying habits, and a recent poll cited that 49 percent, nearly half of all Americans have “delayed or sped up purchases as a result. Those figures are far higher for Black (70 percent) and Latinor (71 percent) adults.”

While inflation has significantly lowered than in the past, it is slightly above what the Federal Reserve would like to see, at 2 percent, and core inflation for April was the lowest increase in nearly four years; and, as a reminder it strips out the most volatile components like gas, and energy, and is a key predictor for economists to track where inflation is headed.

Of equal concern is the contraction of the GDP last week to an annualized rate of -0.3 percent in the first quarter, according to the Commerce Dept. last Wednesday, the nation’s worst quarter since 2022, after Trump took office.

Trump blamed former President Joe Biden, saying that the US would have to get rid of the Biden “Overhang”, and that the decrease had nothing to do with the threat of tariffs, “only that he left us with bad numbers,” and urging Americans to be patient.

The Fed meets this week on May 7, and is unlikely to lower interest rates in lieu of this solid report, and will hold off any rate changes until there is less economic uncertainty; noting that current rates are holding steady at a range of 4.25 percent to 4.5 percent.

Again, the worst fear is that consumers will cut back “so aggressively that businesses will be forced to lay off workers, worsening the economic slowdown.”

March Jobs Report: the calm before the storm

For many economists the March Jobs Report released on Friday by the US Bureau of Labor and Statistics gave some restrained  squeals of delight, since it showed a higher than expected gain of 228,000 jobs, far less than the 135,000 many expected, and it also gave some concern for the future of two key areas: interest rate changes from the Federal Reserve, and the heavily promoted, but not yet announced, tariff program by President Donald Trump, and there was a collective tension among those whose job is to take the temperature on the American economy, the largest in the world; and, that palpable tension could be felt across the nation.

In and of itself, the report showed an unemployment rate of 4.2 percent, steady, slightly higher than previous months, but enough to give a measure of satisfaction, and against a background of interest rates holding steady at 4.25 to 4.5 percent created a background of sureness to those same observers.

There were some patterns that remained the same, ebbing and flowing, but fairly predictable in light of previous reports: government employment, swelling to 6,000; retail at 24,000 (in part ot the retreat of severe winter weather); 54,000 in health care; 23,000 for transportation and warehousing,all giving rise to a predictable report.

Wages were also up 0.3 percent with a year on year total of 3.8 percent year over year, and with current inflation, those would keep many heads above water, for the moment,

Trump weighed in, expressing joy, and in a post on social media, reported by The New York Times, saying in his characteristic all caps: GREAT JOB NUMBERS FAR BETTER THAN EXPECTED. IT’S ALREADY WORKING.”

This may have been premature but it is a typical response from the president, but like those prior months we see the main drivers leading in health care and social assistance, giving “a combined gain of 78,000”.

Revisions, which are a typical pattern by the BLS, now have January and February,  net gains of 45,000, but perhaps Joe Brusuelas, chief economist at the consulting firm RSM,who told the Times, possibly the best remark, avoiding optimism, and said, “What we are really seeing is the calm before the storm.”

That storm came swiftly on April 2, Liberation Day, as the White House titled the announcements of tariffs pegged to the US trade imbalance of 10 to 50 percent across the board and a hefty 25 percent on all foreign cars, pending the following week.

Reactions across the US and abroad were swift and negative, as it threw the global economy into disarray, and the specter of a possible recession; and the net results will affect not not only the tariffs that are paid by US importers; but most importantly, passed onto American consumers in the form of higher prices.

Just beyond, but no less significant, is the threat to long standing alliances with foreign countries, further jeopardizing future interactions with global trade.

Adding tariffs on steel and aluminum will crush the American, Canadian and Mexican auto industry with higher prices, and an exchange of  foreign parts, the result will be higher than average car prices, exceeding the average new US car price of $50,000.

While the Trump administration says its goal is to even the playing field and force foreign companies to make their products in the United States, that goal is hardly feasible, with tariff retaliation, and the near impossibility of suddenly reformatting global supply chains, which in the best case scenario could take years, and considerable expense.

There has been growth in some industries manufacturing in the US, under the Biden administration, yet that hasn't been mentioned by the Trump administration, as it steadfastly clings to its goals.

Considering the massive layoffs in the federal workforce, not reflected in this report since the BLS gathers its data points in the first two weeks of each month, it’s equally important to note that, while some are not technically fired, yet, due to being placed on administrative leave, caused by the Department of Government Efficiency, as a goal of firing even more federal workers.

 After the initial decimation of the US Agency for International Development there are planned workforce reductions of 83,000 employees of the Department of Veteran Affairs by the end of September of this year; 20,000 for the Internal Revenue Service, and a possible 1,155 for the Environmental Protection Agency, among many others with a possible total of 40,000 workers, 80% of them living and working outside of Washington, DC, with a resulting devastation not only to working families, but their local economies.

While there has been rampant criticism of the influx of cheap Chinese goods to the US yet many of them principally clothes, from tee shirts to sweaters have actually been a gain for lower income families, and as an earlier report from the Times noted, “lower prices are in effect a pay increase, leaving consumers with more money to spend on goods and services.”

With widespread price increases, low income families, the poorest, will see a double whammy and Marketplace.org reported, “The Yale Budget Lab also estimated [among other cost increases] that Trump’s tariffs alone will slash disposable income in the poorest households by at least $,1700 a year. Simply put. The lowest income households spend more money on necessities.”

Furthermore, they added how higher grocery prices will affect the same households, noting that the top half of higher income households spend about “10% of their income on food,” but noted Tim Richards, an agribusiness professor at Arizona State University, “But, if you look at the lowest 20% of income earners, they spend 30% of their income on food.”

The national media has been awash in criticisms of the president, but even some conservatives have criticized the formula that the White House has used and as Axios has reported:

• “The administration's calculation assigns a value of 0.25 to that variable, which in the math of price elasticity suggests most of the tariff impact does not hit the import price of an item as it enters the country.

• But the AEI paper says they used the wrong value for import prices, and instead used the value for a retail price, or what happens to the final consumer price after the good is imported and distributed.

• They argue, instead, that the right value is 0.945 — in other words, almost all of the tariff hits the import price of a good as it's brought into the country.

• "It is inconsistent to multiply the elasticity of import demand with respect to import prices by the elasticity of retail prices with respect to tariffs," the authors write.

Supporting the formulaic errors, FactCheck.org discussing tariffs, expanded these assertions by claiming that the formula used on the chart that Trump held aloft in the Rose Garden, is self created,”Those listed numbers are simply not tariffs, but some other made up measure based on a formulaic trade deficit calculation,” noted Kimberly Clausing, a nonresident fellow at the Peterson Institute for International Economics, told us via email. “In almost every instance countries’ true trade barriers are far, far lower.”

What worries people most, not only in the US, but across the world is that these tariffs will create a global recession, and as we have seen the stock market drop in the thousands, not seen in 5 years, these fears are justified.

Paradoxically the president said on Monday, from Air Force One, that he doesn't want to see “anything go down,” but suggested that we have to take a little bad medicine to make things good.

Commerce Secretary Howard Lutnick has said that these tariffs and fiscal policies are “worth it” even if they cause a recession, reported the Times, and his position was seconded by Treasury Secretary Scott Bessent who added that the economy might need a ‘“detox period” after becoming dependent on government spending.”

Good, however, may be a relative term with many working families, and even the more affluent facing financial  challenges that will affect retirement savings, children, or grandchildren’s education, among other things.