The Hidden Recession: What Trump’s Policies Are Doing to Your Wallet

 Recent economic data reveals that while the U.S. economy hasn’t collapsed under President Trump’s nationalist agenda, it’s clearly showing signs of strain. Key indicators such as job growth, GDP, and inflation all reflect troubling trends linked to Trump’s aggressive trade and immigration policies.

The U.S. added just 73,000 jobs in July, far below expectations. Revised numbers also show that job growth in May and June was drastically overestimated, with only 19,000 and 14,000 jobs added respectively. Manufacturing and transportation sectors began shedding jobs shortly after Trump announced sweeping tariffs, reversing his promise to restore factory employment.

While second-quarter GDP growth was reported at 3%, analysts say this number is misleading due to erratic swings in imports caused by tariffs. When adjusted for these distortions, real growth in the first half of the year was just 1.2%, much slower than in 2024. Economic momentum is now heavily reliant on AI infrastructure spending, rather than widespread consumer or industrial strength.

Trump’s tariffs have raised input costs for businesses, discouraged investment, and fueled inflation. His immigration restrictions have reduced the U.S. labor force by 1.7 million workers since March. Economists estimate these policies are lowering annual GDP growth by nearly 1.3 percentage points combined.

Despite slowing growth, inflation is accelerating. Core consumer prices rose 2.8% year-over-year in June, driven by increases in trade-sensitive goods such as electronics and furniture. Without the tariffs, inflation may have returned to the Federal Reserve’s 2% target.

Unemployment remains relatively low at 4.2%, and consumer spending is still holding — though only slightly. Payroll growth is slowing, and additional layoffs could reduce spending further, triggering a negative economic cycle. The Federal Reserve may struggle to respond if both inflation and unemployment rise simultaneously, as its tools are designed to address one or the other — not both at once.

Trump’s economic nationalism is already reducing U.S. prosperity. Without a shift in policy, the country risks sliding into a period of stagflation or even recession. Though some sectors remain active, the impact of tariffs and immigration cuts is becoming increasingly visible in American households and businesses.