Trump’s Economy Faces Warning Signs as Job Growth Slows and Inflation Rises

Trump’s economy warning signs are becoming increasingly evident. After six months in office, President Donald Trump’s economic overhaul is under intense scrutiny. Despite promises of a “golden age,” the latest financial data paints a different picture.

On Friday, a disappointing jobs report revealed that U.S. employers cut 37,000 manufacturing jobs since Trump launched new tariffs in April. Overall job gains in July were just 73,000, down significantly from previous months. Inflation is also ticking up, with prices rising 2.6% over the past year, while GDP growth has slowed to an annual rate of under 1.3%.

Trump Doubles Down Despite Negative Indicators

President Trump ignored the downturn, instead firing the head of the federal agency responsible for jobs data. He claimed on Truth Social that the economy is “BOOMING,” despite offering no evidence.

Analysts are cautious. Guy Berger of the Burning Glass Institute noted, “The economy’s just kind of slogging forward. It looks like a ‘meh’ economy is continuing.”

Trump’s policies—tariff hikes, tax code changes, and spending cuts—have reshaped multiple sectors. But the full impact may not be felt until 2026, right in the middle of the next election cycle.

Economic Risks Grow for Middle-Class Americans

The administration’s new tariffs on global imports could raise costs for American consumers, particularly on everyday items like furniture, appliances, and toys. While the White House claims these trade deals show Trump’s negotiating strength, public sentiment is less optimistic. Only 38% of adults currently approve of his economic leadership, according to an AP-NORC poll.

Still, the White House insists this is just a transition phase. “The best is yet to come,” said spokesman Kush Desai, echoing Trump’s earlier promises.

Inflation Concerns and Political Pressure on the Fed

Trump has criticized Federal Reserve Chair Jerome Powell for not cutting interest rates, warning that high rates could stall growth. However, cutting rates might also spark further inflation, especially as Trump’s tariff strategy continues to evolve.

The Fed remains cautious. Governors Christopher Waller and Michelle Bowman supported a rate cut, citing a weakening labor market. Meanwhile, Trump’s tariff policies keep shifting—his latest import tax changes replaced an earlier plan that caused a stock market dip.

Biden and Economists Sound the Alarm

Former President Joe Biden warned in December that Trump’s tariff strategy could hurt American consumers and businesses alike. “I believe this approach is a major mistake,” Biden said, criticizing Trump’s push for steep, universal tariffs.

Friday’s jobs and inflation reports, coupled with slowing GDP growth, suggest Biden’s concerns are coming true.