Made in America Jobs 3.0 & Taming Inflation – Top 3 Takeaways, September 8th, 2025
Takeaway #1: Made in America Jobs 3.0
As a data wonk, each month’s jobs report is something that’s intriguing to me. There are always so many more storylines beyond the headlines than ever get told. But what’s been especially interesting to me in recent months is to check on a phenomenon that’s underpinned the recent government jobs reports painting a vastly different picture of what’s going on in the U.S. job market, and overall U.S. economy, than what is discussed in the commonly concerning headlines. The headline numbers from Friday’s government jobs report once again bely a bigger story brewing beneath the rising unemployment rate at 4.3%, and paltry job growth of only 22,000 jobs added, than when accounting for revisions to prior months were essentially wiped out as negative revisions to prior reporting took away 21,000 previously reported jobs. The storyline I’ve been tracking for months, that showed up yet again in the most recent report is the extraordinary dichotomy in foreign born jobs lost in comparison to American jobs added. But there’s so much more to the story and the reason why we’re seeing job losses is a potentially great thing for the average American employee. What is that thing...? There are 1.1 million fewer ‘foreign born’ workers in the U.S. work force since the start of the Trump administration. It’s a number that’s dropped from a total of 1.5 million since March as the administration’s crackdown on illegal immigration gained momentum. Meanwhile, what we’ve seen over the same time is the addition of 896,000 net new jobs added in the United States. So, what does that actually mean in context? What this means is that American employment has risen by 2 million jobs this year – a total that’s 250,000 jobs monthly! This is the real storyline that needs to be told...
Takeaway #2: More good news
...that is if you believe that Americans, rather than illegal aliens, should be getting job opportunities. Not only has American employment exploded this year – unsurprisingly as illegal aliens are rapidly exiting the workforce – with Americans getting job opportunities, but wages continue to rise meaningfully too. The average hourly wage reached a new record high of $36.53 per hour last month and it is 3.7% higher than a year ago. With an inflation rate at 2.7% over the same – the average American is continuing to make financial progress with 1% more net to show than a year ago-ex inflation. What this data also suggests is that it’s likely self-deportation numbers continue to be huge. When it comes to deportations, we don’t know what we don’t know, which means that the only self-deportations we’re aware of are those that’ve taken place using the CBP One Home App – of which only several thousand have been reported thus far. While digging deeply into the jobs data, there yet again was far more than meets the eye. Going forward you can expect to see labor force participation rates rise once again as Americans who’d been knocked out of the workforce, by those here illegally, continue to see the opportunity to work once again. What this also is likely to mean is faster and higher wage increases as well. There continues to be a lot here. A LOT, that tells a story about immigration as much as it does the labor market. Another huge underlying storyline in all of this is...
Takeaway #3: The Impact on inflation
This week we’ll get two huge inflation numbers. The consumer and producer price index reports showing the most recent inflation rates. They’re uber important as far as interest rate policy is concerned, as of today, a 100% probability of interest rates being cut in September has been priced into the market, with an 80% probability of an additional rate cut in next month’s meeting as well. That’s encouraging news for people hoping for the cost of living to come down. But in advance of those reports, it’s possible that yet again we could see inflation potentially tamer than expected, in part due to the impact of net-outbound immigration. As I illustrated in an analysis in February, for every 5% increase in immigrant population, the increase in housing costs for American citizens was 12%. The unwinding of that impact, has and will continue to have an effect on the biggest expense for people, which when combined with lower interest rates in the months ahead, should meaningfully impact affordability. Illegal immigration was a huge part of the ‘Bidenflation story. It’s been a key reason why inflation hasn’t risen to date the way the Fed thought it would due to President Trump’s higher tariff rates. Economic data has become a lot more interesting, even for me, than it used to be because it’s the best insight we have into the impact of Trump’s immigration policy.