Trump tariffs killing the US economy? Tough times ahead for jobseekers and investors

President Donald Trump’s tariffs seem to be sending the U.S. economy into a tailspin. Even though job growth held steady in May with the economy adding 139,000 jobs, the unemployment rate has stayed in a tight range — between 4% and 4.2% — over the past year, according to The Wall Street Journal’s report.

Thanks to inflation fears, the Federal Reserve is hesitant to cut interest rates which are hurting businesses, big and small.

John Starr, the owner of UltraSource, an importer and manufacturer of meat-processing technology in Kansas City, Mo., said, “How am I supposed to pay this?” said Starr, a third-generation owner of the company. “That could wipe out profits for a year.”

READ: Trump doubles down on steel and aluminium with his tariffs (June 4, 2025)

Starr reportedly orders equipment that has a lead time measured in months. Because those products are made to each customer’s specifications, Starr can’t resell them if clients refuse to eat the cost of the tariff.

“I have to take action now,” Starr said. “We’re going to be very careful about any cash expenditure just because we need that cash to pay the tariff.”

Christopher Thornberg, founding partner at Beacon Economics in Los Angeles said that where this goes all depends on what Trump decides to do next, and emphasising his candour, he said that “even Trump doesn’t know what Trump will do next.”

“The economy has a lot of momentum, and so if Trump truly backs off on tariffs and just calms down, you could see this expansion going another two, three years, honestly,” added Thornberg.

President Trump’s tariff policies in 2025 have had a notable impact on the U.S. economy, generating both challenges and shifts across various sectors. The tariffs on imports, particularly from major trading partners, have contributed to slower economic growth, with forecasts predicting a dip in GDP growth rates. Inflation has risen, partly driven by higher costs of goods such as electronics and automobiles, which reduces consumer purchasing power.

Households are estimated to face decreased disposable income due to these price increases.

“As long as the consumer is doing OK, it’s not going to change our world,” said Ric Campo, chief executive of Camden Property Trust, a Houston-based developer and owner of 58,000 apartment homes.

Additionally, retaliatory tariffs from countries like the European Union and Canada have strained international trade relationships, affecting industries dependent on cross-border commerce. Financial markets have reacted with volatility; while large technology firms have mostly withstood the pressure, smaller companies have struggled amid uncertainty and rising costs.

Overall, Trump’s 2025 tariffs highlight the complexities of protectionist policies—offering some domestic industry protection but at the expense of broader economic stability and consumer welfare.

READ: US job market suffers under Trump’s tariffs (June 6, 2025)

It is unclear what Trump’s long term plans are regarding his tariffs, on one hand, the tariffs may bolster his support among voters who favor protecting American jobs and industries, reinforcing his image as a strong nationalist leader.

On the other hand, the economic challenges caused by higher consumer prices and slowed growth could erode broader public approval, especially among middle-class voters feeling the financial strain.

Additionally, strained trade relations might limit his ability to negotiate future deals. Ultimately, the tariffs’ impact will shape how history views Trump’s approach to economic policy—either as a bold defender of American interests or as a leader whose protectionism brought unintended economic setbacks.