Tariffs (again), Inflation, and Unemployment
Media Hit, 3/8/25
I’ve got a radio spot on the Randy Tobler Show, bright and early tomorrow morning at 7:25 Eastern time. In addition to talking about tariffs, we just had an unemployment report come out today (3/7) and they want to talk about inflation.
It’s 10:30 PM on Friday, 3/7 at the time of this writing. Given how early the show is, I’m getting ahead of it and setting myself up for tomorrow morning. Anyway, on to links (that I found) and talking points!
Tariffs
I mean good grief. We still have things to talk about on this? I’ll probably get up early tomorrow morning just to make sure that there weren’t any crazy developments at odd hours of the night. Other than that, the usual talking points will come up here.
Update (at 6:40 AM): Nothing really to report here other than that I feel the need to put timestamps in here in case something does change later on today.
Unemployment Report
Link: https://www.bls.gov/news.release/empsit.nr0.htm
A number of factors contributed to the lower numbers:
End of two pandemic era spending packages
DOGE effectively firing a bunch of federal employees and freezing hiring in one of the fastest growing sectors of the labor market from the past administration, “the government sector.”
But also… the uncertainty surrounding tariffs and trade policy.
All of this uncertainty just makes things harder for larger businesses who are looking to try to lock in multi-year deals.
But also for smaller businesses who just need to know what the world will be like for the next two weeks to conduct their business and adjust their prices as necessary.
We’ve got plenty of smaller stores, coffee shops, etc. that have added tariff-related surcharges only to then have to refund their customers and/or reprint menus, etc, with new prices. Repeatedly.
Unemployment rate ticked up a little bit from 4% to 4.1%, that’s nothing really to be concerned about at this point.
Underemployment, however, did jump up half a percentage point and labor force participation rate fell as well.
I’m not super concerned about these, though they’ll be something to watch in the coming months for sure.
It’s also concerning that we have a rising unemployment rate and a declining labor force participation rate. Those two combined tell us that there’s more than meets the eye in terms of what’s going on in the labor market right now.
Inflation
I’d be remiss if I didn’t point out that most of the price increases that we’re seeing right now are not actually inflation, they’re related to tariffs and the changing cost of business.
Inflation is always and everywhere a monetary phenomenon.
So in response to the constantly shifting tariff policy, it’s very likely that we’ll see prices continue to creep upward.
But this is not inflation, at least not to an economist.
What Happened?
The talk went great. Randy is a wonderful host who let me give a few longer-ish answers and even extended the segment so we could continue talking.
We spent the entirety of our time together talking about tariffs, manufacturing jobs, and whether being more self-sufficient was a good idea or a bad idea. We didn’t even touch unemployment rates or inflation. Randy also (on air!) invited me back on for next week to talk more, which is always a fun compliment to get.