Trump ends four uninterrupted years of job creation in the US

Donald Trump returned to the White House promising to boost job creation. So far this hasn’t happened: the labor market is weakening and, for the first time since the Covid pandemic, is beginning to show negative job growth. According to indicators released on Friday, 22,000 non-farming jobs were added in August, far lower than the 76,000 new positions economists had been expecting to see.

There are also revisions indicating that June’s job total was negative for the first time in more than four years. Revised figures for that month show a shift from a growth of 14,000 positions to a decline of 13,000. The 73,000 jobs for July were revised to 79,000. Combined, job creation in both months falls short of expectations by 21,000. The unemployment rate in August rose to 4.3%, the highest since October 2021.

The U.S. economy created jobs in each of Joe Biden’s four years in office, during which records for new job creation were broken. The latest job losses occurred in the last full month of Donald Trump’s first term in the White House. With the Republican’s erratic economic and trade policies and the uncertainty generated by his measures, the 53-month streak of job creation was broken in June, according to revised data.

The data released this Friday by the Bureau of Labor Statistics (BLS) represents further evidence that the labor market is deteriorating in the world’s largest economy, and paves the way for an interest rate cut at this month’s Federal Reserve meeting. The question at the Federal Open Market Committee will not be whether to cut rates, but rather how much and how many times in the coming months.

The report is the first since the disappointing July figures, which so angered U.S. President Donald Trump that he almost decided to fire the director of the BLS. The revised figures are worse than those originally published.

The data is also the first since Trump’s global tariffs went into effect on August 1, amid promises, yet to materialize, that the measure would unleash an avalanche of job creation in the domestic manufacturing sector. The White House resident maintains that it will still take months before official data yields “real numbers.” Analysts attribute the weakness in the labor market, in part, to the impact of the tariffs and the Republican administration’s aggressive immigration policy.

The U.S. government and the Federal Reserve were closely monitoring this report, which further signals that the labor market is deteriorating and the economy is beginning to show signs of weakness. ADP, one of the payroll giants, had reported on Thursday that only 54,000 private sector jobs were created in August. The law firm Challenger, Gray and Christmas reported that companies have announced more layoffs so far this year than in any other year since the 2020 shutdown at the height of the pandemic. The number of workers changing jobs has plummeted, an indication that opportunities are shrinking. For the first time since 2021, there are more registered unemployed people in the country than available jobs.

All of this is a sign that the post-pandemic job boom appears to be fading, while the economy shows no signs of picking up. This is worrying for Trump, who based his election campaign on promises to improve the economy.

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