U.S. President Donald Trump attends an event to honor Angel Families at the White House in Washington, D.C., U.S., February 23, 2026. REUTERS
On Friday, the Trump administration celebrated a better-than-expected jobs report, which showed the U.S. gained 172,000 jobs in May. But while President Donald Trump may be patting himself on the back, one respected economist warns that the good news misses a “clear paint point” that shows the economy is shakier than the job numbers suggest.
“This is the clear pain point in the economy,” posted Heather Long, chief economist at Navy Federal. “Wage growth in May was the lowest in 5 years. May wage gains: 3.4 percent (for past year). May inflation: Likely to be ~4 percent.”
That’s bad math for the economy, meaning that inflation is outpacing wage gains. Or as Long puts it, “It's easier to get a job now, but it's hard to find a job where your pay will keep up with current inflation.” What’s more, Long notes that wage gains have hit their lowest point in five years, since May 2021, when the pandemic was still wreaking havoc on the global economy.
Other experts have agreed with Long’s not-so-fast assessment of Friday’s positive job report.
According to Bankrate Senior Economic Analyst Mark Hamrick, “It's very likely, given recent trends, that real wages will continue to fall and workers and their families will find it increasingly difficult to make ends meet.” Hamrick also argues that affordability challenges have reduced job mobility, and that what job growth there has been is limited to a few sectors, which doesn’t bode well for economic strength overall. At the same time, he suggests that a strong labor market makes it less likely that the Fed will cut the interest rate, resulting in higher borrowing costs and slower business expansion.
And as U.S. economic policy expert and former chief economist for the GOP Ways and Means Committee, Donald Schneider, noted, there is an interesting correlation between the rising job numbers and the removal of a key Trump policy: tariffs. Schneider shared a chart that plots both the effective tariff rate and job growth, saying, “These things might be related.”
The chart indicates that as Trump’s tariffs began to fall at the end of last year, the plunging job growth rate started leveling off. Then tariffs plummeted after the Supreme Court slapped them down in February, and lo and behold, that’s precisely when the job numbers began racing upwards. So as Scheider points out, there appears to be a direct link between the two trends. Trump has announced his intentions to reintroduce tariffs.
Europac chief economist Pete Schiff noted another issue with the job news, posting, “Unfortunately, all of those jobs were either in leisure and hospitality, or in government or government-related services. That drives demand for imported goods, increasing trade deficits and goods prices.”
As one of his respondents explained, “We are subsidizing consumer demand without creating the domestic goods to match. Pumping government payrolls and service wages gives consumers cash to spend, but since the U.S. isn't producing physical goods, that liquidity immediately leaks out of the country to buy foreign imports.”
“Exactly,” Schiff agreed.
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