President Donald Trump spoke of “the great American comeback” in his State of the Union address last night — and he attributed much of the nation’s success to a “roaring economy.”
The president stated that “our economy is the best it has ever been,” citing as evidence the low unemployment rate, rising incomes and a purported return of manufacturing jobs.
Below, a roundup of the president’s claims about the economy at the 2020 State of the Union.
Turnaround of ‘failed economic policies’ led to 50-year unemployment low
The unemployment rate currently sits at a 50-year low of 3.5%, which Trump attributed to his reversing “the failed economic policies of the previous administration.” He also said the unemployment rate for Hispanics, African Americans and Asian Americans has hit a record low, with female unemployment at its lowest rate in 70 years.
While these numbers are accurate, job creation has slowed under the Trump administration, according to U.S. Labor Department statistics: One million more jobs were added in the 35 months before Trump took office compared to his first 35 months in office. According to the Labor Department, 145,000 jobs were added in December 2019, missing expectations of an increase of 160,000.
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Wages are rising due to a ‘blue collar boom’
“After decades of flat and falling incomes, wages are rising fast and wonderfully; they’re rising fast for low-income workers,” said Trump. “This is a blue-collar boom.”
Notably, although wages have gone up under the Trump administration, they’ve also risen under the past few presidents. In December 2019, wages increased but fell short of expectations, rising 2.9% year over year in comparison with a projected 3.1% bump.
Consumer confidence has ‘reached amazing new heights’
“Consumer confidence has just reached amazing new highs,” Trump told the joint session of Congress, adding that “wealthy companies are pouring money into areas that have not seen investments in many decades, creating jobs, energy and excitement.”
For the fourth quarter of 2019, consumer confidence hit a near-historic high of 123 according to The Conference Board. The research group attributed the increase to improved sentiment about job prospects as well as optimistic spending intentions, led by rising wages and a low unemployment rate.
Manufacturing is ‘coming back to the U.S.A’
Trump said his administration is “restoring our nation’s manufacturing might,” pointing to 12,000 factories added under his tenure, including both those “being planned or being built,” the president said. He said that companies are “coming back to the U.S.A,” calling the country “the place where the action is.”
In 2019, the manufacturing sector added a total of 46,000 jobs, according to the Labor Department, down from the 22,000 per month added in 2018. In terms of footwear, nearly 98% of products sold in the U.S. are produced abroad, according to the American Apparel & Footwear Association, due to lower labor costs and less labor-intensive production methods in other countries. Nonetheless, some major brands, including Adidas and New Balance, have invested in manufacturing stateside.
Trade war has stopped ‘China’s massive theft’ of American jobs
Last month, the U.S. and China signed a “phase one” trade agreement, reaching a deal that both addresses intellectual property protection and promises more Chinese purchases of U.S. goods. The partial agreement also eased nearly two years of tensions between the world’s two largest economies, thanks to the United States pulling back certain planned tariff hikes.
“[I] promised citizens I would impose tariffs to confront China’s massive theft of America’s jobs,” Trump stated. “Our strategy has worked.”
Following the president’s speech, Footwear Distributors & Retailers of America president and CEO Matt Priest noted that while the “phase one” agreement was an “important first step,” much of the shoe industry is united in believing that it’s not enough.
“[W]e strongly urge the President to continue to negotiate a phase two deal that puts an end to all the new tariffs he raised in order to give U.S. footwear companies some much-needed certainty and increase opportunities for job and sales growth,” Priest said in a statement following Trump’s address.
Steve Lamar, president and CEO of the AAFA, agreed with Priest, stating that American workers and consumers “have seen no benefits from the much-touted deal with China.”
“Frankly, the fact that we are still charging these punitive tariffs on any products — on top of the already high tariffs our industry pays — means American consumers, workers, and companies are still feeling the full force of the trade war,” Lamar said.