The Bureau of Labor Statistics, which is still widely trusted, reported this week that only 64,000 new jobs were added to the U.S. economy in November. That number sounds positive at first, but it is far too small to keep up with the number of people who are actively looking for work.
Because of this, the unemployment rate went up again. It rose to 4.6 percent in November, compared to 4.4 percent in September and just 4.0 percent back in January. In other words, more people are out of work now than earlier this year.
What makes this even more worrying is the bigger picture. Since April, the American economy has barely added any jobs at all. Growth has essentially stalled. Compared to November 2024, there are now about 710,000 more people unemployed. That is a sharp and troubling increase.
If wages were rising quickly, this situation might be easier to manage. But they are not. Wage growth is slowing down, not speeding up. That means even people who still have jobs are finding it harder to keep up with rising living costs.
Donald Trump has tried to place the blame on the Federal Reserve, arguing that it has been too slow to cut interest rates. But the Fed does not only focus on jobs. It also has a responsibility to control inflation, and prices are still going up. Cutting rates too fast could make inflation even worse.
There are two main reasons the economy looks so weak right now.
The first is Trump’s tariffs. These tariffs raise costs for businesses, and employers are hesitant to expand or hire new workers because of them. Companies either have to absorb those extra costs or pass them on to customers through higher prices. On top of that, the tariffs create uncertainty about the future, and businesses tend to stop hiring when they feel unsure about what comes next.
The second reason is cost-cutting by employers. Payroll makes up about two-thirds of most business expenses, so companies try to reduce labor costs whenever possible. This has been happening for decades through outsourcing jobs to other countries and replacing workers with machines. What is different now is the rapid rise of artificial intelligence, which makes it much easier and cheaper for companies to replace human workers with technology.
The result of all this is simple and painful. Prices are rising, jobs are not being created, and wages are not growing fast enough. Most Americans are struggling to pay their bills, cover rent, afford groceries, or keep up with healthcare costs. This is what many people are now calling the affordability crisis.
Politically, this sets the stage for serious trouble for Republicans, especially if Democrats focus clearly on affordability issues in the next midterm elections. Voters tend to punish leaders when their everyday lives become harder, regardless of political loyalty.
A strong affordability-focused platform could include removing many of Trump’s tariffs, breaking up powerful monopolies, giving workers more power through unions, raising the minimum wage, and lowering the cost of essentials like healthcare, housing, and childcare.
Robert Reich, who is a professor of public policy at the University of California, Berkeley, and a former U.S. secretary of labor, argues that these steps are necessary to restore economic balance. He continues to write about these issues on his Substack, and his latest memoir, Coming Up Short, explores many of these themes in depth.
