On April 30, 2025, President Donald Trump convened his cabinet in the White House. He stood in front of the nation and outlined exactly how his new, proposed tariffs on imports would tank the U.S. economy. Despite the short-term turmoil caused by these tariffs, Trump expressed optimism about striking new agreements with trade partners, predicting long-term economic benefits.
In early April, Trump announced a set of tariffs that caused some of the largest market movements ever. That announcement prompted the biggest single-day stock market collapse since the start of the COVID-19 pandemic. This abrupt downturn created a great deal of confusion among operators and consumers alike. When he finally made up his mind to suspend the majority of these tariffs, the market exploded overnight. This unprecedented one-day spike highlights the precariousness of our current economic climate.
Second, the U.S. economy entered a recession in the first quarter of 2025, contracting at a 0.3% annualized rate. Much of that drop was due to uncertainty over Trump’s proposed tariffs. This prevented the effective tariff rate on Chinese goods from falling below its highest level in more than a century. Even with these worries, the labor market seemed impenetrable. So far this year, the U.S. has added an average of 170,000 jobs per month. At the same time, unemployment is at its lowest point in history.
Economists are expecting next week’s jobs report to show a net gain of just 133,000 jobs in April. We hope that this report helps shed light on just some of the ways that businesses have been responding to the latest tariff escalations, announced on April 2. Summers sees economic growth everywhere—from job growth to increased productivity and more! At the same time, inflation is easing and prices have come down considerably from the highs we experienced in 2022.
…those promises are Trump’s commitment to renegotiating existing international trade agreements, a reflection of a deeper frustration with international trade practices. He stated, “We have been ripped off by every country in the world practically. And friend and foe.” This sentiment underscores his administration’s aggressive approach toward trade reform and its perceived necessity for revitalizing the U.S. economy.
His go-to justification was the superheated labor market. Overall, analysts can be cautiously optimistic about what this could mean for future employment trends and economic growth. Further buoying the outlook, the U.S. economy exploded out of the gate at a 2.4% annualized clip in the final three months of 2024. This remarkable performance suggests strength, despite the continued trade skirmishes.
