President Trump entered 2026 predicting a landmark year for the US economy. The data so far tells a different story. Job losses, rising gas prices, a falling stock market and the inflationary pressure of an active war in Iran have combined to create one of the most challenging economic moments of his second term.
The Jobs Picture
The economy lost 92,000 jobs in February, the third monthly decline in five months. December was revised to show a loss of 17,000 jobs. January was also revised downward. The unemployment rate rose to 4.4%. Without the healthcare sector, the economy would have shed roughly 202,000 jobs since Trump took office in January 2025.
Trump has argued his immigration crackdown would direct more jobs to US-born workers. However, the unemployment rate for people born in the United States has climbed over the past 12 months from 4.4% to 4.7%. The White House has noted that construction job gains outside of housing point toward future hiring. The administration has averaged fewer than 5,000 new jobs per month since taking office.
Gas Prices and Inflation
Keeping energy costs low has been a consistent Trump talking point. That argument has been complicated by the Iran war. Gas prices have jumped 19% over the past month to a national average of $3.45 per gallon, according to AAA. Goldman Sachs warned that if higher oil prices persist, inflation could climb from 2.4% in January to 3% by year end.
The administration is betting the conflict will end quickly or that the $20 billion maritime insurance program can get more tankers moving through the Strait of Hormuz. Energy Secretary Chris Wright told CNN on Sunday he believes the energy price spike is a matter of weeks, not months. Economists are less certain. Raymond James chief economist Eugenio Aleman warned the situation creates “probably the worst scenario for monetary policy” and said the word stagflation is likely to be heard again. (The Hill)
The Federal Reserve’s Dilemma
The Iran war has put the Federal Reserve in a difficult position. Weak job numbers would typically push the Fed toward cutting interest rates. But rising oil prices and inflation risk could force policymakers to hold rates steady or even consider increases. RSM chief economist Joe Brusuelas said the Fed’s decision-making framework is now facing “a real stress test.” (NBC News)
The White House has called on the Fed to cut rates immediately, with spokesman Kush Desai saying it is “high time” for the central bank to stop “strangling America’s economic resurgence.” The administration also said there has been no discussion of releasing oil from the Strategic Petroleum Reserve to ease price pressure. (CNBC)
Stocks and Consumer Sentiment
The Dow Jones Industrial Average has fallen 5% over the past month. The S&P 500 dropped 1.5% on Friday alone. Consumer sentiment data from the University of Michigan showed a split between stock owners, whose confidence had risen in February, and those without stock holdings, whose confidence declined. The gap between those two groups is a widening measure of economic inequality in how Americans are experiencing this moment.
Productivity Up, Workers Not Benefiting
Business sector labor productivity rose 2.8% in the fourth quarter of last year. That is a positive long-term indicator. However, labor’s share of income fell to the lowest level on record in 2025, according to the Economic Security Project. The gains in productivity are not yet being passed to workers in the form of higher wages.
A Direct Comparison
Trump has frequently argued that his economic record surpasses that of President Biden. The data shows a more mixed picture. The US economy grew at 2.8% in Biden’s final year, compared to 2.2% under Trump in 2025. Inflation measured by the personal consumption expenditures price index was 2.6% in both 2024 and 2025. (Associated Press)
The Midterm Dimension
With November’s midterm elections on the horizon, the economic picture matters politically. A CNN poll found nearly 60% of Americans disapprove of US military action in Iran. A Fox News poll found 61% of voters disapprove of Trump’s economic management. Support for the Iran strikes in early polling is running at just 38%, lower than retrospective support for the Iraq War in 2014, according to pollster G. Elliott Morris. (Axios, CNBC)
Why This Matters to You
The economy affects every American directly, from the price of filling up a tank to the cost of groceries, rent and borrowing. The combination of job losses, rising gas prices and potential inflation is not a set of abstract data points. It is a description of daily financial pressure on millions of households.
For voters heading into a midterm election year, the economic picture will likely be the defining issue. It is worth thinking about: If the Iran war continues for weeks and oil prices remain elevated, how much further could inflation rise and what does that mean for interest rates on mortgages and credit cards? With productivity rising but workers’ share of income falling to a record low, who is actually benefiting from economic growth right now? And with the administration ruling out a Strategic Petroleum Reserve release, what tools remain available to ease the pressure on everyday consumers?
-Elijah Iraheta, Editor in Chief, ASC News
