Mark Zandi, chief economist at Moody’s Analytics, cautioned that the labor market is stagnating and attributed part of the issue to President Donald Trump’s tariffs.
However, the Supreme Court—set to issue a ruling soon on the administration’s global tariffs—could offer relief and aid in reviving job growth, he stated in a .
This follows the reporting that payrolls increased by 50,000 in December, with the unemployment rate slipping to 4.4%. In 2025 overall, employers added only 584,000 jobs—a steep drop from the 2 million added in 2024 and the poorest year outside of a recession since the early 2000s.
Zandi noted that since Trump’s “Liberation Day” tariffs surprised global markets in April, there has been no job growth—and he added that future revisions will probably reveal net losses.
“This mirrors the direct impact of tariffs on manufacturing, transportation and distribution, and agriculture-related businesses—all of which are steadily shedding jobs—as well as the indirect blow from uncertainty that’s slowed hiring for most other companies,” he clarified.
In fact, industries exposed to trade saw significant losses last year. The manufacturing sector, for instance, has lost 70,000 jobs since April. Tens of thousands more have been cut in mining and logging, and in warehousing too.
At the same time, health care and social services are among the rare industries with consistent hiring. Without these two sectors, the U.S. economy would have experienced a payroll decline for the year.
“Other factors are definitely involved—like highly restrictive immigration policies, DOGE cuts, and artificial intelligence—but the global trade war is clearly contributing to the struggling job market,” Zandi added. “So the quickest way to strengthen the job market would be for the Supreme Court to rule reciprocal tariffs illegal and for lawmakers to let them fade away.”
Justices are poised to issue a decision at any time regarding Trump’s authority to impose tariffs under the International Emergency Economic Powers Act (IEEPA).
That law has been the basis for most of Trump’s trade war—including the so-called reciprocal tariffs and fentanyl-related duties. The administration has also used IEEPA tariffs to finalize trade agreements with the European Union, Japan, South Korea, and other nations.
However, a Supreme Court ruling against Trump wouldn’t end his tariff system. Other tariffs are rooted in different laws and aren’t being reviewed by the high court.
New tariffs could also be put in place without using IEEPA, though those would take more time to implement—and some would only allow shorter periods to tax imports.
Even though administration officials have voiced confidence in having other methods to impose tariffs, Trump might not act on that right away.
With the affordability crisis now a key concern for lawmakers, Trump has reduced some duties on coffee, pasta, and other staple goods, while .