Economist Mark Zandi says the U.S. labor market is faltering under the weight of President Donald Trump’s tariffs and that a Supreme Court ruling could offer the quickest path to restoring job growth.
Trump’s Tariffs Driving Manufacturing And Trade Job Losses
On Sunday, Zandi highlighted the impact of Trump’s global tariffs in a social media post, linking them to the sluggish job market.
“This reflects the direct effects of the tariffs on manufacturing, transportation and distribution, and ag-related businesses, which are steadily losing jobs, as well as the indirect uncertainty hit to hiring by most other businesses,” Zandi wrote.
The latest jobs report showed payrolls rose by just 50,000 in December, with the unemployment rate edging down to 4.4%. For all of 2025, employers added 584,000 jobs, a steep drop from 2 million in 2024 and the weakest annual growth outside a recession since the early 2000s.
Health Care Steady While Trade-Exposed Industries Struggle
Trade-exposed sectors have borne the brunt of the slowdown.
Manufacturing has lost 70,000 jobs since April, with mining, logging, and warehousing also shedding tens of thousands of positions.
Health care and social services remain among the few industries continuing to hire.
Zandi added, “Other factors are certainly at play, including highly restrictive immigration policies, DOGE cuts, and artificial intelligence; however, the global trade war’s fingerprints are all over the ailing job market.”
Manufacturing Jobs Slow As Tariffs Weigh
Last week, Manufacturing job growth weakened broadly, with only 38.2% of manufacturing sub-sectors still adding jobs, down from 47.2% a year earlier, signaling a widespread slowdown, according to Joe Weisenthal.
Joel Griffith said the sector recorded 8 straight months of job losses, citing pressure from Trump’s tariffs.
At the same time, consumer confidence edged higher at the start of 2026, with the University of Michigan’s preliminary January sentiment index rising to 54, its highest level since September.
The improvement was driven mainly by lower-income households and easing fears of accelerating job losses, though concerns about high prices, tariffs and a softening labor market persisted, keeping overall sentiment well below year-ago levels.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo courtesy: noamgalai from Shutterstock
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