Job Growth Tumbles in Trump’s First Year

jobs chart
By Michael Rainey and Yuval Rosenberg

Good evening. The December jobs report released by the government today showed another month of subdued gains, capping a year that saw a dramatic cooling in the labor market. What does that all mean for 2026? We've got some details.

Job Growth Tumbles in Trump's First Year

The U.S. economy added 50,000 jobs in December, according to data released by the Bureau of Labor Statistics on Friday.

The job growth total fell short of expectations, continuing a trend of tepid hiring by employers stretching back to the second quarter of 2025. Data for the previous two months were revised lower, as well, underscoring the trend.

At the same time, the unemployment rate dropped a tenth of a point to 4.4%, easing concerns about a rapid deterioration in the labor market. However, the rate fell largely due to workers leaving the market, a worrying sign.

The December numbers bring total job growth for 2025 to a modest 584,000. By comparison, the U.S. economy added about 2 million jobs in 2024, and 2.6 million in 2023. On average, the economy added just 49,000 jobs per month in 2025 - the weakest average monthly growth during a non-recessionary year since 2003, when the economy was still recovering from the dot-com bust.

The great majority of the job growth in 2025 came in just two sectors, healthcare and social assistance. Employment in healthcare grew by 405,000 during the year, while social assistance employment grew by 308,000.

Employers hit the brakes on hiring: The hiring slowdown since April, when President Trump announced his "liberation day" tariff increases, is notable. About 85% of the job growth during the year occurred by the end of April, after which employers slammed the brakes on hiring.

Although Trump has portrayed his tariffs as an effort to revive manufacturing employment, the levies appear to be having the opposite effect. Since the tariffs were announced, the goods-producing sector has lost about 90,000 jobs, and employment has shrunk for eight months straight.

Employment has also fallen over the course of the year in the mining, wholesale trade, and transport and warehouse sectors. Government employment is lower, as well, thanks in large part to the administration's DOGE project to slash the size of government. Federal employment is down by about 277,000, or 9%, since January.

What the analysts are saying: The labor market has clearly lost much of its momentum, though employers have avoided large-scale layoffs, even as they slow hiring to a trickle.

"The United States is in a jobless boom," Heather Long, the chief economist at Navy Federal Credit Union, told CNN. "There was almost no hiring in 2025 ... we would be talking about job losses in 2025, if it weren't for health care and social assistance."

Appearing on CNBC, Long noted that, "It's a great scenario for Wall Street, but an uneasy feeling on Main Street."

U.S. Bank Chief Economist Beth Ann Bovino told The Wall Street Journal that the labor market is at an "inflection point" despite strong economic growth. "[T]he jobs market is very fragile - the unemployment rate is low, but businesses aren't hiring," she said.

Catherine Rampell, economics editor at The Bulwark, noted that some corners of the manufacturing sector are getting by as the tariffs help some companies but hurt others. "Manufacturing overall is contracting," she wrote. "If you drill down you'll see metal manufacturing is doing ok, because Trump pummeled their competition with tariffs. Meanwhile the downstream US firms that have to buy more expensive metal (machinery, autos) are screwed."

The lack of hiring is showing up in the long-term jobless numbers. In December, the number of people out of work for more than 27 weeks increased by nearly 400,000 compared to a year ago, and the number of people who are working part-time but would prefer full-time work has increased by nearly 1 million.

Revisions ahead: Some experts are warning that, as weak as the 2025 numbers are, they could be much worse after final revisions. "With these revisions, the story of payroll employment in 2025 will convert, ex post facto, from 'snail-like growth' to 'recessionary-like conditions,'" Brian Bethune, an economist at Boston College, said Friday, per CNN.

The bottom line: The "no hire, no fire" labor market persisted through the end of 2025. The question for 2026 is whether the economy will keep growing at a decent clip even without big jumps in employment, or if the lack of hiring becomes a drag that forces the economy to shift into a lower gear.

Oil Executives Express Skepticism About Investing Billions in Venezuela

President Trump hosted oil and gas executives at the White House today, where his aim of securing $100 billion or more in investments to rebuild Venezuelan oil infrastructure was met with skepticism and pushback.

"We have to get them to invest, and then we have to get their money back as quickly as we can, and then we can divvy it all up between Venezuela, the United States, and them," Trump said. "I think the formula is simple."

The industry executives suggested that the first part of that plan is nowhere near simple. ExxonMobil CEO Darren Woods said the situation in Venezuela as it currently stands is "uninvestable."

"If we look at the legal and commercial constructs and frameworks in place today, in Venezuela today, it's uninvestable, and so significant changes have to be made to those commercial frameworks, the legal system," Woods said. "There has to be durable investment protections, and there has to be a change to the hydrocarbon laws in the country."

Woods indicated that he believes that the Trump administration can stabilize the situation and make the changes needed to draw investment. He said a technical team from ExxonMobil would soon assess conditions on the ground if they had a security guarantee. Even so, he said, several questions would need to be answered before his company could evaluate the investment potential.

"The questions will ultimately be: How durable are the protections from a financial standpoint? What are the returns look like? What are the commercial arrangements, the legal frameworks?" Woods asked. "All those things have to be put in place in order to make a decision, to understand what your return would be over the next several decades that these billions of dollars of investments would be made on."

Quote of the Day

"I can't think of anybody in history that should get the Nobel Prize more than me."

‒ President Trump, speaking to reporters Friday after his White House meeting with oil industry executives, when asked about a planned meeting next week with Venezuela's María Corina Machado, who won the Nobel Peace Prize last year. Trump had said he would accept the prize if Machado offers it to him.

Trump told reporters recently that he did not believe Machado could lead Venezuela. "She doesn't have the support within, or the respect within, the country," he said. "She's a very nice woman, but she doesn't have the respect."

Asked if the prize would change his view on having Machado lead Venezuela, Trump said he would have to speak with her. Then he again claimed to have settled eight wars before criticizing the Nobel Peace Prize awarded to former President Barack Obama.

Later, when asked about his push to acquire Greenland, Trump seemed to lob a threat: "I would like to make a deal the easy way but if we don't do it the easy way, we're going to do it the hard way."

Nobel officials quickly shot down the possibility that Trump could be given Machado's peace prize.

"The facts are clear and well established," the Norwegian Nobel Committee and the Norwegian Nobel Institute said in a statement. "Once a Nobel Prize is announced, it cannot be revoked, shared, or transferred to others. The decision is final and stands for all time."

Have a great weekend! Send your feedback to yrosenberg@thefiscaltimes.com.

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