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Washington: The latest employment report in the United States is bad news for a president whose agenda revolves around returning America to a “golden age”, driven largely by a resurgence in manufacturing.
It shows jobs growth continues to stagnate, with just 22,000 positions created in August - while job losses in manufacturing were 12,000 for the month, and 78,000 for the year to date.
Manufacturing job losses totalled 78,000 for the year so far, despite the Trump administration’s bid to restore US factories.Credit: Bloomberg
Last time Donald Trump received a weaker than expected jobs report from the Bureau of Labour Statistics - a month ago - he ordered the sacking of the agency’s commissioner, economist Erika McEntarfer.
This time, there’s no figurehead to blame. Trump’s pick to replace McEntarfer is yet to be confirmed by the US Senate.
The bureau found total non-farm payrolls, a widely watched indicator of US economic health, rose just 22,000 in August “and has shown little change since April”. Job gains in the healthcare sector were partially offset by losses in the federal government and in mining, quarrying, and oil and gas extraction, it said.
The August report also made further revisions to earlier months’ data, finding that in June, the US economy actually lost 13,000 jobs, rather than gaining 14,000 (a number which had already been revised down from 147,000). The July jobs growth figure was revised upward slightly to 79,000.
The report was the first since Trump sensationally sacked the former head of the Bureau of Labour Statistics for announcing weak data.Credit: Bloomberg
Kevin Hassett, the director of Trump’s National Security Council, told CNBC that while the figures were “a little bit disappointing”, he expected them to be revised up later.
That’s entirely possible. Survey completion rates have fallen markedly since the pandemic, making it difficult for the bureau to provide accurate data in a timely, monthly fashion. That was true when McEntarfer was sacked for revising figures down, and it’s true today.
Overall, the unemployment rate ticked up to 4.3 per cent - the highest since September 2017, outside of the COVID-19 spike, though still low.
Trump reacted to the latest data by repeating his calls for the Federal Reserve to cut interest rates. “[Fed chair] Jerome ‘Too Late’ Powell should have lowered rates long ago. As usual, he’s ‘Too Late!’” Trump posted on social media.
US Federal Reserve chairman Jerome Powell in Jackson Hole, Wyoming, for the Fed’s annual gathering of global central bankers.Credit: Bloomberg
Speaking at the central bank’s annual summit in Jackson Hole, Wyoming last month, Powell gave a strong signal that rate cuts are on the way, noting the risks to employment were rising and “may warrant adjusting our policy stance”.
President of the Alliance for American Manufacturing Scott Paul agreed the new report ought to spur a rate cut. But he also warned Trump needed to finalise his policies on tariffs and trade.
“Concluding tariff actions and trade deals to provide businesses with the certainty they need to hire, invest in new capital equipment, and realign supply chains,” he said. “Manufacturing will be treading water until we see those changes.”
Sacked BLS chief Erika McEntarfer.Credit: US Bureau of Labor Statistics
Justin Wolfers, an Australian economics professor at the University of Michigan, said the data was worrying and indicated rosy assessments of the US economy’s resilience were premature. “Bad policy leads to bad outcomes, but the actual economy doesn’t move at the pace of the political cycle,” he said.
Wolfers credited bureau staff for compiling the data “despite the arbitrary firing of their boss, uninformed social media insults, and the prospect of being led by an unqualified ideologue”.
Trump’s pick for the job, E.J. Antoni, is the chief economist at the Heritage Foundation, a right-wing think tank that produced the conservative blueprint Project 2025. On Friday, CNN reported Antoni once ran a now-deleted Twitter account that contained sexually degrading attacks on Kamala Harris, conspiracy theories and anti-gay remarks.
Meanwhile, Trump is engaged in a different form of reality-denial. Hours before the employment data was released, he was asked whether he would accept the numbers. He dismissed the question, saying “the real numbers” would come out in a year or so, once his economic agenda was realised.
Life is more difficult when you can’t just shoot the messenger.
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