Additional Coverage:
- GDP growth paints a rosy picture of the economy — but most Americans have a major problem with it (marketrealist.com)
Economic Growth Figures Paint Rosy Picture, But Many Americans Struggle With Inflation and Job Security
Recent economic reports suggest a robust American economy, with the US Bureau of Economic Analysis announcing a significant 4.3% GDP growth in the third quarter-the highest in the past five quarters. While these figures, often highlighted by President Donald Trump, present an optimistic outlook, many middle and low-income families are experiencing a starkly different reality. Inflation, exacerbated by the President’s tariffs, continues to be a major concern, diminishing the positive impact of economic growth for a large segment of the population.
According to a CNN report, unemployment and inflation remain top concerns for citizens. Mark Zandi, chief economist at Moody’s Analytics, articulated this sentiment, stating, “GDP is an abstract concept.
But people know jobs. They know they can’t find a job if they lose theirs.
And they know they are paying more for coffee, beef, electricity, child care, and just about everything else.”
The observed increase in consumer spending, a key driver of higher GDP, appears to be concentrated among higher-income individuals and those with significant real estate holdings, who have benefited from record-high property values. This trend is indicative of a “K-shaped” economic recovery, a term used by many economists to describe a situation where different parts of the economy recover at different rates, with some segments thriving while others lag.
While some attribute high prices to President Trump’s tariffs, the overall inflation rate has actually decreased from 3% to 2.7% since he took office. However, this figure still surpasses the pre-pandemic average annual inflation rate of 1.7%. Despite this, prices for certain goods have seen a reduction, with eggs being 13% cheaper than a year ago and milk prices dropping by 1%.
Gasoline prices have largely remained stable, a notable positive for the Trump administration. Conversely, the cost of several other essential items has surged.
Americans are reportedly paying an average of 7% more for electricity, and prices for natural gas and beef have also seen significant increases. Although salaries have risen during this period, many Americans feel these increases are insufficient to offset the rising cost of living.
Job security is another pressing concern, particularly as several prominent companies have announced significant layoffs in recent months. Unemployment recently reached a four-year high of 4.6%. The CNN report further indicates that, for the first time in four years, the number of job seekers has surpassed the available job openings.
Hiring has also slowed, as employers seek to reduce costs by operating with leaner workforces. President Trump’s tariffs have reportedly contributed to this trend, compelling businesses to cut staff in an effort to manage expenses.