President Donald Trump spent much of the past year engineering price increases, financial panics, and trade wars.
Nonetheless, despite his best efforts, he is presiding over a pretty good economy. Or so the headline statistics would suggest.
Last week, a pair of government reports showed robust job growth and slowing inflation. Employers added 130,000 jobs in January, bringing the unemployment rate down to 4.3 percent. Meanwhile, consumer prices rose by just 2.4 percent over the past year — just a few ticks above the Federal Reserve’s target rate.
Thanks to that modest price growth, Americans’ purchasing power is significantly higher today than it was when Trump took office, as the average hourly wage has risen by 3.7 percent since January 2025.
What’s more, last year also witnessed a surge in productivity — or the amount of output that the economy generates from a fixed quantity of labor, capital, and materials. According to Stanford economist Erik Brynjolfsson’s calculations, US productivity grew at a 2.7 percent clip in 2025, nearly double its average pace over the preceding decade.
Finally, as of this writing, the S&P 500 index is more than 14 percent higher than it was before Trump’s second term began.
And yet, as Americans have seen their wealth and purchasing power climb over the past 12 months, they’ve grown steadily more discontented with their economy.
Since Trump took office, consumer sentiment has plunged by 26 percent and now sits near all-time lows, while the president’s approval rating on the economy has fallen deeply underwater. And myriad other gauges of the public’s economic mood show the same basic trend.
In many respects, this is a familiar story. Real wages have been rising in the US since 2023, yet Americans’ assessments of the economy have remained resolutely dour. And pundits have proffered many explanations of this long “vibecession” (e.g., people still haven’t adjusted psychologically to the new price level; housing remains unaffordable; living through a mass death event blows, etc).
Here, though, I’m not going to hazard a comprehensive account of America’s gloomy, post-pandemic mood. Rather, I want to explore a narrower question: Beneath the headline figures, do any recent economic data points help explain the public’s dissatisfaction with the Trump economy?
Are essentials getting more expensive?
In a Substack post earlier this month, former Biden White House economist Mike Konczal offered one potential explanation for the public’s discontent: While wages have been rising faster than prices overall, they haven’t kept up with the cost of many essentials.
Not all consumer items are equally indispensable. Americans rarely need to buy a new flat-screen TV. But they must typically purchase food on a regular basis. And in Konczal’s analysis, the prices of necessities — namely, groceries, housing, health care and transportation — have been rising faster than overall inflation since the pandemic.
As a result, most households have been forced to devote a larger share of their budgets to these must-haves — and thus, to pare back on discretionary purchases.
One could quibble with Konczal’s definition of “essentials.” It’s not obvious why clothing and gasoline wouldn’t qualify as necessities. And the prices of those items have actually grown slower than overall inflation since 2019.
Nevertheless, Konczal’s data is illuminating. And it does help explain why consumer sentiment has been persistently low since 2022.
As an account of why Americans are even more unhappy with the economy today than they were when Trump took office, however, Konczal’s analysis isn’t entirely satisfying. (And, to be fair, explaining Trump-era shifts was not his article’s stated objective.)
Although his post shows that the prices of “essentials” have risen faster than overall inflation since 2019, this is almost entirely due to trends that predated Trump’s inauguration.
Since January 2025, wages have actually grown faster than the prices of most “essentials,” as Konczal defines them. And wage growth has also far outpaced energy costs.
Of course, this does not mean that necessities became more affordable for all Americans in 2025. Wage growth is not evenly distributed across the workforce. Some people are unemployed. And housing costs vary sharply between regions.
Nevertheless, in the aggregate, it was easier for Americans to afford essentials in January 2026 than it had been one year earlier. At first blush then, trends in the prices of necessities make the public’s discontent appear more mysterious, not less so.
The problem might be electricity and negativity
This said, a few highly salient necessities have become less affordable since Trump took office.
Overall energy costs — as calculated by the Bureau of Labor Statistics — fell by 0.1 percent over the past 12 months. But that headline figure conceals massive variation in the pricing of discrete energy goods and services: While gasoline prices dropped sharply in 2025, Americans’ electricity and natural gas bills surged.
Humans are susceptible to negativity bias — all else equal, we tend to pay more attention to losses than gains. And this is liable to be especially true of Americans’ current perceptions of price trends.
The public already considered America’s cost of living intolerably high when Trump took office. Therefore, the fact that gasoline and groceries became slightly more affordable last year might not have felt especially noteworthy to voters; these things were supposed to become less expensive. Indeed, the new president had promised as much.
By contrast, when your gas and electricity bills rise from a baseline you already deemed exorbitant, that’s sure to provoke both your attention and consternation.
In other words: Since Americans were already exhausted with inflation in January 2025, they may have had zero tolerance for further spikes in the price of any essential.
Also, there are barely any new jobs
The public’s discontent may also reflect the cooling of America’s labor market. Although unemployment remains low by historical standards, the economy added only 181,000 jobs all of last year, according to data released last week. That makes 2025 the worst year for job growth since 2020. If one puts aside that pandemic year, employment growth has not been this slow since 2010.
Likewise, outside of 2020, job openings are lower today than at any time since 2017.
In short, workers are no longer a hot commodity in the US. And this is particularly true of professionals. As Axios notes, America’s core white-collar industries — finance, insurance, information, and professional and business services — collectively shed 1.9 percent of their jobs since the end of 2022.
This is historically anomalous; normally, these sectors steadily increase hiring outside of recessions.
The downsizing of America’s white-collar workforce began before the popularization of generative AI. But advances in artificial intelligence have likely helped to sustain the trend.
Indeed, falling demand for office workers is likely the flipside of last year’s surge in productivity: As companies discovered how to wring more output from a single worker hour — through the help of AI and other innovations — they’ve been able to cut back on hiring without sacrificing production.
For now, these shifts haven’t triggered widespread unemployment. But it has constrained American workers’ exit options — and thus, their bargaining power. As the left-leaning Economic Policy Institute (EPI) notes, real wage growth last year trailed its average annual pace between 2019 and 2024.
And the slowdown was especially sharp at both the top and bottom of the income ladder: The highest-earning decile of Americans saw their real wages grow by just 0.4 percent in 2025, compared to an average pace of 1.1 percent during the five years prior. Meanwhile, real wages actually fell for the poorest decile of workers, after climbing at a 2.4 percent annual clip from 2019 through 2024.
Americans therefore have some cause for unease about where the labor market is headed.
What’s more, white-collar workers likely exert disproportionate influence over how economic conditions are perceived, since we enjoy an outsize voice in journalism and politics. Given that clout, the fact that job and wage growth has been especially weak in white-collar sectors might partly explain the darkening national mood.
Vibes also matter
This is by no means an exhaustive catalog of the public’s grounds for economic displeasure. But rising utility bills and slowing hiring have likely contributed to the nation’s unhappiness.
This said, the severity of Americans’ discontent seems difficult to explain with reference to purely objective factors. In the University of Michigan’s index, consumer sentiment is now lower than it was during the heart of the Great Recession — and it is hard to argue that the economy is worse today than it was in March 2009. So voters’ outrage likely reflects shifts in both what they are experiencing economically and how they interpret that experience.
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