Donald Trump the campaigner really harped on the message of jobs: “Buy American, Hire American” was one of President Trump’s favorite phrases on the stump. Trump has largely delivered on that promise with nearly a quarter-million jobs added to the United States economy in November of 2017, according to the Department of Labor.
There are economists out there, however, who feel that Donald Trump’s triumphant gloating over the rise in job numbers could come to a screeching halt as structural economic issues become more apparent. Although the national unemployment tumbled below four percent briefly – it’s now at 4.1 percent – parts of the country that voted for Trump in droves are reporting unemployment rates well into the double digits.
There’s a call among economists to disaggregate the national Department of Labor statistics from higher regional unemployment figures that could reveal deep fissures in the underlying structural health of the economy.
The U.S. has indeed recovered the 8.7 million jobs lost due to the Great Recession, but the economy is still disfigured by high unemployment among African Americans (7.3 percent) and teens (15.9 percent). About 150,000 jobs per month were added to the economy, yet certain groups seemed to disproportionately benefit from the recovery. There turns out to be a big urban-rural divide at play as well.
These tendencies were apparent in the 1990s when only 125 urban counties in the U.S. swallowed up half of the new businesses and jobs. Places like Miami offered low taxes, and metropolises like New York and Los Angeles offered incredible cultural and technological resources. To this day, the four percent unemployment matched by three percent growth and unprecedented gains in the stock market largely affect urban, metro areas rather than rural ones.
Trump’s recent tax reform agenda could exacerbate the urban-rural divide. Regional banks, for instance, once formed the cornerstone of credit in rural communities, but President Trump’s tax reform agenda appears to disproportionately benefit larger commercial banks. The fear is that credit might dry up even more, businesses in rural communities could struggle to get startup capital, and the urban-rural divide could become more entrenched.
Although the manufacturing and construction sectors appear to be revitalized, wage growth has stagnated for decades and those workers without a college degree have really been behind the eight ball for the last decade. Trump also needs to lend a hand to the 4.8 million currently underemployed.