August 4

8/4 - U.S. employers added just 73,000 net new jobs in July, while May and June job numbers were revised sharply lower. But with the unemployment rate at a historically low 4.2%, these are the kinds of job numbers many economists expected for 2025. It’s hard to continue to add new jobs in a full employment economy. On a positive note, Q2 GDP growth was estimated at +3.0% vs -0.5% in Q1. A big jump in domestic inventories ahead of Liberation Day caused the Q1 GDP decline, while the paring down of inventory led to an impressive 3.0% growth for Q2. Taken together, the net result is relatively weak 1.2% GDP growth for the first half of 2025, with consensus forecasts for sub-2.0% in the 2nd half of the year. Tariffs are taxes. Whether paid by exporters, importers, or consumers, they add cost to the system. As those costs trickle through, higher prices and lower profits will dampen prospects for future jobs and growth.