Weak Job Growth is Dragging Trump and Republicans Down—But Why?

The American economy is not working for everyone. This could pose a serious electoral problem for Republicans this year if they don’t find a way to instill confidence and optimism in American workers through the job market.

The Trump recovery has been nothing short of impressive. On the surface, it appears the economy is recovering nicely from the slump former President Joe Biden put it in.

Despite claims his tariffs would surge inflation and spark a recession, they’ve barely affected consumer prices at all. Inflation is down to 2.7 percent, compared with 2.5 percent right before the COVID-19 Pandemic. Gas prices have recovered to the glory days of President Donald Trump’s first term. GDP growth has surged, from a near contraction in the first quarter of 2025 to an expected 5.3 percent growth in its last quarter. Businesses are turning healthy profits, and CEO and investor confidence are bullish.

But other indicators do show cause for concern. The current GDP growth isn’t translating into across-the-board economic growth.

Consumer confidence hasn’t been this low since the height of the pandemic, and job growth remains stuck in recession-style doldrums.

The job market is experiencing its lowest growth since 2020. The last time it was this anemic before that was during the Great Recession, in 2009. In 2025, the economy only added 584,000 jobs. By contrast, during each of the last two years of Biden’s presidency, the economy added over two million.

“The job market shouldn’t feel as broken as it does right now,” wrote Bankrate analyst Sarah Foster, last November. “The U.S. economy grew by the fastest pace in nearly two years last quarter, the stock market is on a tear and unemployment is still relatively low.”

She added that in 2025, the economy was only creating one-tenth the jobs it normally did in a similar growth spurt.

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So, Why Are Companies Not Hiring, 
and Why Is Consumer Confidence Low?

It’s difficult to instill confidence through positive macroeconomic metrics alone. Biden found this out the hard way. If people are not feeling confident about their personal income prospects, charts and statistics will not convince them.

In reality, the aging, bureaucrats, and affluent are the only reason there’s anything positive to draw from 2025’s economic growth.

Health care understandably had the strongest job growth, a trend that will continue as Baby Boomers age. But its magnitude is troubling. Private education and health services constituted 56 percent of all job growth, of which health care made up 95 percent.

Despite the Department of Government Efficiency’s layoffs, government sector growth came in second at 21 percent, and leisure and hospitality came in third at 12 percent.

On the GDP side, fully half of last year’s growth came through data center expansion. This indicates businesses are expanding at the expense of human capital. They aren’t massively laying off workers…yet. But they aren’t expanding their white-collar labor pools either. The rate at which they’re spending shows they’re either fueling a massive AI bubble—which some economists don’t dismiss—or AI’s ravaging of the white collar job market is indeed imminent.

The latter is suggested by the underwater job growth in the information sector—negative two percent—and the professional and business sector—negative six percent. An MIT study last November found that AI already has the capacity to replace 11.2 million U.S. jobs, which represent $1.2 trillion in wages across finance, health care, and professional services.

That feeling Foster referenced that the job market is broken? It’s not going to get worse before it gets better. It’s just going to get worse.

There is no silver lining for many college-educated young professionals, particularly young women, who will be twice as likely to become victims of AI job replacement as young men.

Although AI disruption is inevitable, it is not inevitable how we choose to prepare for it.

The Immigration Solution

The worsening job market is why it’s critical that Immigration and Customs Enforcement speed up deportations. ICE agents must remove all illegal aliens. That especially includes every babysitter, maid, cook, factory worker, home health aide, and cashier who is unauthorized to work in the U.S., not because they pose a threat to Americans’ persons or property, but because they pose a threat to Americans’ livelihoods.

Many Americans look down on these types of jobs because they don’t pay American wages. Once the foreign competition is removed, however, they will. The affluent aren’t hurting in today’s economy. They can afford to pay American women to wash their sheets, watch their children, run their errands, cook their meals, and ring up their orders.

(RELATED: ICE Must Finish the Job in the Nation’s Capital)

Tariff Confusion and Business Uncertainty

Another recurring theme among analysts is blaming the tariffs for the hiring slump. In this, they are correct.

Tariffs are a great tool to restructure the economy by making it cheaper to manufacture goods and provide services domestically. Being the world’s largest economy also makes them a good revenue stream and a big stick to use on friends and foes when speaking softly doesn’t work. Trump has been clear during both terms that he views the tariff as sitting on this three-legged stool.

The problem? Aside from personal statements during press conferences and interviews, his administrations have done a poor job communicating this threefold intent. This has led to confusion among critics and supporters alike who often believe his tariffs aim to accomplish only one or two of these aims.

This matters in the business world. For businesses to expand, they need an environment of certainty. If the business community thinks tariffs aim to punish a country or extract concessions, they may believe their businesses are safe in a different country, ignoring Trump’s stated support for at least a flat 10 percent tariff for revenue purposes.

This confusion and ignorance prevents business model recalibration and delays reshoring.

Ideologically, business owners are rational. They are not nationalistic. Until all hope is removed of operating in a free trade U.S. filled with foreign workers, they will operate understaffed if they believe they can be rid of Trump’s hated economic nationalism in a year or two. Many stateside businesses, particularly small firms, are undoubtedly banking on tariff relief from the Supreme Court or hoping they can wait out Trump until a more free trade-friendly administration gains power.

Trump undoubtedly bears some blame policy-wise. His sudden sharp tariff hikes as retaliation for perceived slights and sudden policy shifts instead of longstanding national policy do not help his cause. For instance, after reaching a phenomenal trade deal with America’s most natural European ally, he essentially tore it up, promising up to a 25 percent tariff on the UK over that country’s opposition to the U.S. acquiring Greenland—something that did not play a role in the trade deal’s negotiation.

This not only harms future trade negotiations but encourages American businesses to scale back hiring and expansion. This will not help Republicans in the midterms.

The path forward requires resolute action and clear communication. AI presents a unique challenge by tempering typical job growth in a strong economy. This is largely out of Trump’s hands, but he can effect mass deportations and universal tariffs, which are fundamental to restructuring the American economy. For this vision to lead to the job growth Republicans need for electoral success, the administration must eliminate any ambiguity about its intentions. Businesses must understand that the era of cheap foreign labor and offshored production is over, not paused. Only when companies abandon their wait-and-see strategies and commit to hiring Americans will the impressive GDP numbers finally trickle down to the working-class voters who decide elections.

(READ MORE: Are Republicans Ready for the Political Backlash to the AI Revolution?)