This morning’s jobs report shows that Trump’s economy is experiencing a jobs crash.
When I say jobs crash, I mean that employers have essentially stopped hiring. Friday's report from the Bureau of Labor Statistics shows that the economy added only 22,000 jobs in August (relative to the normal monthly gain of 180,000 to 200,000).
The revised figures for June, based on added data, show that 13,000 jobs were lost that month. That’s the first net loss in monthly jobs since the start of the pandemic.
Trump blames Jerome Powell and the Federal Reserve for not cutting interest rates sooner but that’s not the reason employers have stopped hiring.
They’ve stopped because the risk is too great.
Trump’s arbitrary, capricious, and mercurial decisions about tariffs and everything else that affects the economy have made it impossible for employers to make even modest predictions about the future. So they won’t hire.
Meanwhile, the Fed can’t cut interest rates much without risking more inflation.
Trump promised to reduce prices, but prices continue to rise. Blame Trump’s tariffs. Prices for wholesalers rose at the fastest pace in three years in July, and those wholesale prices are now being passed on to retailers and consumers.
Food prices are rising especially quickly. The prices of vegetables skyrocketed 40 percent in July. A recent Consumer Price Index report found electricity prices rising at double the rate of inflation, increasing 5.5 percent over the past year.
A jobs crash coupled with soaring prices is bad for everyone — including Republicans seeking to be reelected to Congress next year.
- Robert Reich is an emeritus professor of public policy at Berkeley and former secretary of labor. His writings can be found at https://robertreich.substack.com/
- Robert Reich's new memoir, Coming Up Short, can be found wherever you buy books. You can also support local bookstores nationally by ordering the book at bookshop.org.
