WASHINGTON (AP) — President Donald Trump called for it in his first policy. state of the union address As he tries to sell Americans on the idea of a booming economy, falling prices and booming jobs, he has a much darker picture for a skeptical public.
In fact, just 12 hours before his speech, the Conference Board, a business research group, released its latest report. consumer trust Report. This showed that overall confidence in the economy remains at historically low levels, barely above the level it sank to at the height of the coronavirus recession.
In February, the index rose to 91.2, significantly below the four-year high of 112.8 set in November 2024. Americans remain discouraged by high prices and believe there are few jobs available, the survey found.
Other polls have found similar results, with only 39% of Americans approving of President Trump’s economic leadership. Latest Associated Press-NORC Public Affairs Research Center survey. and a University of Michigan consumer sentiment survey. Stuck in a quagmire at recession levels.
President Trump tried to overcome this gloom by presenting economic data that painted a positive picture, but President Joe Biden has tried this tactic with little success. But on Tuesday night, there was a gap between the president’s claims and the economic reality facing many Americans.
“Inflation is plummeting, incomes are rising rapidly, and our economy is growing faster than ever before,” President Trump said.
Economic growth was slower last year, but
To begin with, the economy is growing, but it cannot be said to be “booming.”
Inflation expanded by 2.2% last year, down from 2.8% last year under the Biden administration and 2.9% in 2023. Indeed, most Americans were deeply dissatisfied with the rapid rise in prices under the Biden administration, which caused inflation to peak at 9.1% in 2022, a 40-year high.
A strong U.S. economy typically resembles the late 1990s, when growth rates exceeded 4% for four consecutive years, and the 1980s, when growth rates exceeded 3.5% for six consecutive years.
Consumers continue to suffer from high prices
Inflation has slowed over the past year, but many Americans still cite high prices in surveys as the main reason they are dissatisfied with the economy.
President Trump rightly noted that core inflation, which excludes volatile food and energy categories, has fallen to its lowest level. Lowest level in 5 years In January. Still other price indicators show that inflation remains stubbornly high: core price indicators closely monitored by the Federal Reserve. 3% higher As of December, it exceeded the Fed’s target of 2% compared to the same month last year. Compared to the measures cited by President Trump, these measures have a lower weight on cooling housing costs.
In a consumer sentiment survey conducted by the University of Michigan in February, nearly half of respondents “spontaneously mentioned that high prices were hurting their personal finances,” study director Joan Hsu said in a statement.
President Trump noted that egg prices have fallen significantly since their peak, and while that’s true, most of the necessities Americans rely on, such as groceries, rent and electricity, are still much more expensive than they were five years ago. And electricity prices rose a further 6.3% over the past 12 months.
President Trump’s tariffs are also raising the price of many imported goods, including furniture, auto parts, tools and clothing. Additionally, prices of food items such as ground beef, coffee, and bananas have risen sharply over the past year. For example, the price of ground meat has increased by 17%.
Employment almost stopped last year.
One reason for consumer pessimism is likely to be: Sharp slowdown in employment last year. Employers added just 181,000 jobs in 2025, or 15,000 per month, making it the worst year for job growth since 2002, excluding recessions.
And despite President Trump’s pledge to revive U.S. manufacturing, factories shed 108,000 jobs in 2025, on top of the 202,000 lost in the past two years of the Biden administration. Automotive and auto parts factories have cut about 74,000 jobs over the past two years.
President Trump’s tariffs are partly to blame, as they force many factories to pay extra fees on imported raw materials and parts. However, in recent years, high interest rates have also taken a toll on the manufacturing industry. And many of them hired, perhaps too aggressively, in 2021 and 2022 as the U.S. economy was recovering from pandemic lockdowns. Automation also means that many factories will need fewer workers.
Recruitment in January was unexpectedly strong 130,000 new jobsfactories added jobs for the first time in more than a year.
Benefits of tariffs remain uncertain
While President Trump has suggested that his tariffs are directly contributing to boosting the U.S. economy, most Americans are likely to see little benefit.
“Factories, jobs, investment and trillions of dollars will continue to flow into the United States,” Trump said.
President Trump again claimed that the tariffs were paid for by foreign countries, making his tariffs sound painless. In fact, they US importer pays They often try to pass the burden on to customers through higher prices. Foreign companies could be hurt if they have to cut prices to maintain U.S. sales. However, import prices have not fallen significantly, suggesting that overseas exporters are not feeling much pain.
A study by Harvard economist Alberto Cavallo and two colleagues found that U.S. consumers ate 43% of the increased tariff costs, with U.S. companies absorbing most of the rest.
And so far, President Trump’s steep import taxes have not made much progress toward the goal of reducing America’s long-standing large trade deficit, the difference between what the United States sells to foreign countries and what it buys from abroad.
The U.S. trade deficit in products such as automobiles and electronics, which are the focus of President Trump’s protectionist policies, actually reached a record $1.24 trillion last year, up 2% from 2024.
