US president Donald Trump has set many specific and general goals for his administration’s management of the economy, like raising growth to 3 per cent and eliminating the country’s trade deficit.
The charts below show how key indicators performed during former president Barack Obama’s second term and how they are performing since Trump took office in January.
“We’re saying 3 (percent) ... There’s no reason we shouldn’t be able to get at some point into the future to 5 and above.”
Trump has pledged to deliver 3 percent annual growth in gross domestic product. The figures jump around a lot quarter to quarter. But absent a change in population demographics or productivity, many economists feel current annual trend growth in the U.S. is around 2 percent, which is roughly what it averaged through Obama’s last four years.
Consumer Price Index
The U.S. has enjoyed tame inflation since the 1990s. Trump has not focused on the issue, but some economists worry that his combination of proposals, if enacted, could lead to faster rising prices. High inflation, particularly without rising wages, is often difficult for politicians blamed for the erosion in household purchasing power.
NONFARM PAYROLLS AND UNEMPLOYMENT RATE
Trump has called the unemployment rate “one of the statistics that to me is just ridiculous,” because it does not account for people who are not looking for jobs. In the vast majority of cases, those people are retired, or doing something else like caring for family or studying in school. The unemployment rate remains a headline barometer of the labor market. It was healthy when Trump took over, as was monthly job growth.
“The jobs and wealth have been stripped from our country. Year after year, decade after decade, trade deficit upon trade deficit.”
Trump and some members of his team see the trade deficit as inherently bad. Most economists disagree, but the administration has said the aim of its trade policy will be to lower or eliminate deficits with the U.S.’s trading partners.
CHANGE IN MANUFACTURING JOBS
“We’ve lost close to 70,000 factories…70,000…You know, you look at a map of the United States – how many factories can you lose?”
Trump has equated American renewal with a rebound in manufacturing, and put trade policy at the center of efforts to make that happen. There is dispute among economists about the potential for manufacturing job growth, however. Even if manufacturing output grows, it is likely to involve fewer workers due to automation and better management.
PRIME AGE PARTICIPATION RATE
“We must honestly acknowledge the circumstances we inherited ... More than one in five people in their prime worker years are not working.”
When Trump took office about 81.5 percent of the country’s 25 to 54 year olds were in the labor force — either employed or looking for work. The figure has been rising, but is short of its late 90s high of 84.6 percent. This statistic, perhaps more than any other, speaks to Trump’s sense of what is wrong with the economy and how his success at fixing it can be assessed.