Economist Highlights Weak 2025 Job Growth
Economist Roman Sheremeta criticized political claims of a booming economy, pointing to weak U.S. job market data. He noted that only 181,000 jobs were added in 2025, a low figure considering the country's population growth. The commentary suggests underlying weakness in the labor market despite positive headline narratives.
The initial 2025 job growth figure of 584,000 was significantly revised downward to just 181,000 for the entire year, averaging only 15,000 new jobs per month. This marked the weakest year for employment growth outside of a recession since 2003. The slowdown was particularly sharp in the latter part of the year, with October and November payrolls being revised down by a combined 76,000 jobs. This sluggish national picture was reflected in a U.S. unemployment rate that fluctuated, ending December 2025 at 4.4% before ticking down slightly to 4.3% in January 2026. Meanwhile, the labor force participation rate remained largely stagnant, hovering around 62.5% in early 2026, which is still below the pre-pandemic peak of 67.3% in early 2000. For professionals in California, the situation was more acute. The state's unemployment rate was the highest in the nation at 5.6% in September 2025, well above the national average. Forecasts suggest California's economy will "muddle through" the start of 2026, with job losses seen in construction, manufacturing, retail, and hospitality. The Bay Area's dominant tech sector faced a significant downturn in early 2025, shedding a net 8,700 jobs in the first two months alone. This contributed to San Francisco's job market shrinking faster than any other major U.S. city, with a 37% decline in job listings from February 2020 to October 2025. However, a counter-trend has emerged with the boom in Artificial Intelligence. AI-related companies leased 1.1 million square feet of office space in San Francisco in the first half of 2025, signaling new growth. Despite overall tech layoffs, the Bay Area still boasts the highest concentration of tech talent in the country and has attracted three-quarters of all U.S. AI venture capital funding since 2019. Looking ahead, economic forecasts for 2026 present a mixed bag. Some analysts expect U.S. real GDP to grow at a modest 1.8% with unemployment potentially rising to 4.8%. The Federal Reserve is expected to proceed cautiously with any interest rate cuts, navigating the balance between managing inflation and addressing emerging weakness in the labor market.
