Continuing along this path are the heavy hitters of health care catering to the aging population of baby boomers joined by high income earners, as we saw last month, still bankrolling restaurants and bars, despite lower alcohol consumption. But, the good times are only a deception since there have been less than 50,000 jobs created since January 2025, and this alone has become a cause of concern for economists as they watch employment to population growth, and see a deficit.
“At this point, we have to be concerned about the strength of the labor market. Total job creation at less than 0.5% is extremely rare in recent history outside of recessions or the jobless recovery of the early 2000’s. This far into an economic expansion, it’s essentially unheard of,” wrote Michael Linden, senior policy fellow at the Washington Center for Equitable Growth, a left-leaning non-profit,” reported The Hill.
Perhaps ominously, he added, ““Combined with the persistent concerns over cost-of-living, a weak labor market could tip the economy into a contraction.”
That brings us to the entanglement of politics and the economy, and one which President Trump said he would fix on the campaign trail and that in the near year since he was sworn into office has not materialized with inflation still hovering at 2.6 percent and persistently high costs of housing and groceries.
Of course, no president controls the economy like the Wizard of Oz as we've stated before, but sitting in the Oval office they have to take it on the chin when costs are elevated, and the polls are showing that Trump is getting negatives in the 30s, while critics have pointed out that he seems more intent on foreign affairs, under the banner of economic gains, but how that will materialize on Main Street, as well as Wall Street is an open question,
There are hopes for lower and abundant gas to fuel America’s love affair with motor vehicles but investors and economists have said that sourcing Venezuelan oil with the removal of President Nicolas Maduro may be more hope than reality with a moribund infrastructure, safety concerns, among many others.
Affordability is the new buzzword when discussing the economy in the US and the high cost of housing, both rental and mortgages, has escalated fears in all but the most well heeled consumer; and, even administration officials are worried about the foreign focus especially with the departure of Trump stalwart Marjorie Taylor Green, and her dire warning of the prospect of the Republicans losing the Congressional dominance in the upcoming midterms over the high cost of living for American working families,
There are some who feel more positive and The New York Times wrote that “Most analysts expect that this momentum moderated in the last three months of 2025. But they still expect growth in the $30 trillion U.S. economy will register a respectable pace in 2026 — above 2 percent — even as serious concerns about housing affordability and the general cost of living persist.”
We are looking at “a series of barometers for Mr. Trump’s second term, during which the president has pursued an agenda of wide-scale deregulation, generous corporate tax cuts, punishing global tariffs, tougher border enforcement and a full-scale restructuring of the federal bureaucracy. That effort alone resulted in the loss of roughly 277,000 jobs from the ranks of government last year.”
Are all of these pieces, as the Times noted, able to cobble together the economy? The absence of an end game has caused worry and concentration in many corners,
Reflecting that worry makes for some searching looks and a less than optimistic, if not pessimistic outlook and “Those policy decisions — immigration, tariff, trade — are probably central to the slowdown that we’ve seen, particularly if you’re comparing it to the last two years or so,” said Olu Sonola, the head of U.S. economic research for Fitch Ratings,” he told the Times.
“It’s not going to be a boom by any means. It’s not going to be a bust by any means,” he said.
Contrast this with what, “In a series of posts on social media, the Council of Economic Advisers said that the jobs figures from December underscored a “a stable labor market where workers’ purchasing power has been improving due to pay increases outpacing inflation.”
“Kevin A. Hassett, the director of the White House National Economic Council, later told CNBC that the hiring numbers “look a little bit different than every other indicator that we have.”
It’s our belief that the White House is looking nervously over their shoulders as they try to manage a full plate, and predictions from those previously cited are reflecting uncertainty wrapped in hope. And, adding to it, Hassett said there is "A heck of a lot of economic growth, and it doesn’t necessarily have to mean a whole huge amount of job creation.”
Of equal concern is “The unemployment rate for young people, between the ages of 16 and 24, appears to have mellowed out after steadily rising from a 2023 low. It’s now at 10.4 percent, down slightly from November. Economists have been particularly concerned about this group, entering the labor market at a time when hiring has been extremely sluggish even though few people are getting laid off.”
When colleges hand out diplomas in May and June, the time for graduates to gain full employment will be further watched closely; and, even last year’s graduates are pessimistic about getting full time employment, seeking marriage, starting a family and buying that first home, with many interviewed stating that home ownership may be merely a dream.
The unemployment rate for Black workers has dropped by seven tenths of a point, to 7.5 percent, reversing November gains. Even with gains and losses that the data tracks, it’s clear that the rate of unemployment at the end of 2024, was 6.1 percent at the end of 2024. And as reported by the Times “Black workers are still roughly twice as likely to be unemployed as white workers.”
Fortune Magazine had noted that “Official unemployment numbers also disguise the depth of the crisis. Black women’s unemployment rate rose from 5.4% in February to 7.5% in September—already more than two points above what the Federal Reserve considers “full employment.” But when accounting for the hundreds of thousands of women pushed out of the labor force entirely since 2020, the real unemployment rate for Black women is 10.23%.”
Concentrated in lower wage jobs such as food service health care, think nursing assistants in care facilities, and retail, Black women’s employment is gaining in these areas but with much lower wages than other roles, “Even within health care, Black women face some of the largest racial and gender pay gaps. Meanwhile, Black women lost 1,500 jobs in government, a more stable and higher-paying sector, and saw zero gains in finance, transportation, or professional services. In short, they are gaining jobs where wages are lowest and losing them where wages are better,” Fortune added.
“Overall, the details of this survey are very encouraging,” wrote Thomas Simons, an economist with Jefferies, in a note to clients. “The slack in the labor market that emerged during the spring and summer looks more and more like a temporary response to the tariff announcements than a fundamental shift in the labor market.:
The Federal Reserve Bank is again in a tight spot, with many saying a pause in future rate cuts,even as far out as April seem unlikely as the focus in reducing inflation will be their goal despite the tepid report from December a move bound to anger the present who wants deep cuts to at least three percent, and while Chair Jerome Powell, whose term ends in May has said he will stay but on Sunday it was also reported by the Times that, “The U.S. attorney’s office in the District of Columbia has opened a criminal investigation into Jerome H. Powell, the Federal Reserve chair, over the central bank’s renovation of its Washington headquarters and whether Mr. Powell lied to Congress about the scope of the project, according to officials briefed on the situation.
The inquiry, which includes an analysis of Mr. Powell’s public statements and an examination of spending records, was approved in November by Jeanine Pirro, a longtime ally of President Trump who was appointed to run the office last year, the officials said.”
In a video taped rebuttal Powell said. “The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the president,” and added “This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions — or whether instead monetary policy will be directed by political pressure or intimidation.”
