\n As President Donald Trump piled on new tariffs last year, many economists quickly warned that prices and unemployment would spike. With most of the 2025 economic results in, it\u2019s looking like those forecasters get partial credit.\n <\/p>\n
\n While prices for certain imports like beef, coffee and tomatoes increased significantly last year, price hikes overall were little changed. The same can\u2019t be said of the job market.\n <\/p>\n
\n The average monthly job growth last year was the lowest in decades outside of recession years. Additionally, the unemployment rate increased by 0.4 percentage points to 4.4% over 2025, according to the December jobs report<\/a>, released Friday.\n <\/p>\n \n Though the job market had already been tightening leading into 2025, Trump\u2019s sweeping tariffs<\/a> and his many<\/a>, many<\/a> subsequent<\/a> adjustments<\/a> haven\u2019t helped.\n <\/p>\n \n With little clarity over Trump\u2019s next move, businesses have paused hiring plans \u2013 or, in some cases, laid off workers.\n <\/p>\n \n \u201cThere\u2019s no compelling reason to be out there hiring en masse,\u201d said University of Central Florida economist Sean Snaith. \u201cThat is a rational response when you\u2019re dealing with this kind of uncertainty.\u201d\n <\/p>\n \n Tariffs have also changed businesses\u2019 calculations on what is or isn\u2019t profitable anymore.\n <\/p>\n \n \u201cCompanies are seeing higher prices, depressing profitability; and in terms of new investment, they\u2019re hesitant because tariffs make a lot of investments that have been profitable unprofitable,\u201d said Dean Baker, senior economist at the Center for Economic and Policy Research.\n <\/p>\n \n Customers are also putting off purchases due to the back and forth on tariff levels. For instance, the Federal Reserve Bank of Richmond noted in the central bank\u2019s recent Beige Book, a compilation of business anecdotes, that several manufacturing contacts \u201csaid that their customers reduced new orders due to uncertainty about tariffs.\u201d\n <\/p>\n \n And it\u2019s not just customers who are confused. Trump\u2019s erratic trade policy has also left businesses in a state of paralysis. For the most part, they\u2019ve been absorbing higher tariffs without passing along the heftier bills to consumers. That\u2019s helped keep inflation in check.\n <\/p>\n