Update 891: Aug. Job Gains’ Slowdown

September 8, 2025 | FY26, Jobs, Nominations, Stock Trading, The Fed, Update | By

Update 891 – Aug. Job Gains’ Slowdown;
SBC Miran Fed Hearing Raises Concerns

The August jobs report released this morning showed a much lower-than-expected 22,000 jobs added to the economy last month and a net 13,000 job loss in June, with Trump’s tariffs noticeably softening the labor market. The soft jobs data comes as the Trump administration has requested an expedited ruling from the Supreme Court this week in the hopes of protecting its tariff agenda. This request followed a ruling from a federal court against Trump’s use of “emergency powers” to levy duties unilaterally on dozens of countries in April. 

This week, the Senate Banking Committee considered the nomination of White House Council of Economic Advisors Chair Stephen Miran to fill the remaining months of an unexpired term on the Federal Reserve’s Board of Governors. The fallout from Trump’s illegal pocket rescission announced last week continued, implicating FY26 funding negotiations. A bipartisan group in the House introduced a strong bill banning stock trading by members of Congress after months of negotiations.

Good weekends all,

Dana

Headline

22K Jobs Added in August Amid Downward Revisions to July Jobs Numbers

Total nonfarm payroll employment rose by 22,000 jobs in August while the nation’s unemployment rate ticked up to 4.3 percent, according to the August jobs report released by the Bureau of Labor Statistics this morning. Job gains in July were revised up from +73,000 to +79,000 jobs, while job gains in June were revised down from +14,000 to -13,000 jobs. With these revisions, June saw the first net job loss since December 2020. The report shows that the labor market is notably softening under the weight of the Trump administration’s economic policies, particularly its increased tariffs. 

Last month, the largest job gains came in health care, which added 31,000 jobs, below the average monthly gain of 42,000 over the prior 12 months. Employment in social assistance rose by 16,000 jobs. 

Jobs were lost in nearly every other industry in August:

  • Federal government (-15,000 jobs)
  • Manufacturing (-12,000 jobs)
  • Wholesale trade (-12,000 jobs)
  • Mining, quarrying, and oil and gas extraction (-6,000 jobs)

Today’s report indicates that the labor market has been softening by more than previously estimated over recent months as businesses and consumers adjust to the rapidly shifting economic environment. The Federal Reserve has been hesitant to lower interest rates over this year as inflation has begun to rise, but cooling in the job market over the prior several months puts the Fed’s dual mandate of stable prices and maximum employment in tension. The significant moderation in job gains over the past several months will likely incline officials on the Fed’s interest rate-setting committee to cut rates by 25 basis points at its meeting on September 16 and 17. 

Trump Nominees

Senate Banking Considers Miran’s Fed Gov. Nomination

Council of Economic Advisors Chair Stephen Miran appeared before the Senate Committee on Banking, Housing, and Urban Affairs yesterday, as the banking committee considered his nomination to fill the remaining roughly five months of an unexpired term on the Board of Governors of the Federal Reserve. President Trump nominated Miran to fill the unexpired term of former Fed Governor Adriana Kugler, whose resignation took effect on August 8.

Republicans are seeking to confirm Miran before the Fed’s interest rate-setting committee, the Federal Open Market Committee (FOMC), meets next week. President Trump has called for the FOMC to drastically cut interest rates despite inflation ticking up amidst his administration’s sweeping tariff policy. The Fed has held rates steady throughout this year. At the FOMC’s last meeting in July, two Trump-appointed Fed governors dissented, supporting a rate cut instead of another pause. Kugler’s resignation gives Trump the opportunity to add governors to the FOMC who will support his preferred monetary policy path. As Ranking Member Elizabeth Warren (D-MA) said, President Trump “wants to install his lackey so that we will have a Fed that uses its power to please the president, but that can’t be trusted to keep inflation under control.”

As Warren also noted, “President Trump has conducted a long campaign to seize control of the Federal Reserve. He’s tried to intimidate and threatened to fire Chair Powell. When that didn’t work, he illegally attempted to fire Federal Reserve Board Governor Lisa Cook, so that he could seize control of the Fed.” 

Miran said he would not resign from his role as Chair of the White House Council of Economic Advisors, which directly serves the President, but would take an unpaid leave of absence instead. This could allow him to return to the White House after his term as Fed governor ends in January. Senator Jack Reed (D-RI) called this arrangement “ridiculous,” saying, “Well, your independence has already been seriously compromised by your statement.” Miran said “I’m committed to the independence of the Federal Reserve,” but has previously proposed weakening the longstanding independence of the Fed, including by making Fed governors fireable at will by the president.

Miran will need to be confirmed by the Senate Banking Committee and on the Senate floor before he can be sworn in as Fed governor. 

Other Developments

Trump’s Trade Agenda Heads to the Supreme Court

On Wednesday, the Trump administration requested that the Supreme Court expedite a ruling to protect much of its signature tariff agenda. This request comes after a federal appeals court ruled last month against Trump’s use of the International Emergency Economic Powers Act (IEEPA) to place duties on dozens of countries in April. The IEEPA tariffs in question are those rates announced on “Liberation Day” on nearly every trading partner, which have since been adjusted, as well as duties placed on Canada, Mexico, and China regarding concerns of fentanyl flowing into the U.S.These rulings could be devastating blows to Trump’s trade agenda which centers on his ability to implement punishing tariffs on trading partners unilaterally. 

A group of twelve states and five small businesses challenged the President’s broad use of IEEPA. Specifically, the court affirmed the use of “IEEPA’s grant of presidential authority to ‘regulate’ imports does not authorize the tariffs imposed by Executive Orders.” The president maintains broad powers in times of national emergency, which is enacted with a simple signature on an Executive Order through the National Emergencies Act. When President Trump declared a national emergency citing national security threats from alleged fentanyl trafficking and global trade imbalances, he was able to utilize IEEPA to implement sweeping tariffs. However, the federal appeals court found that Congress still holds the authority to impose tariffs or duties. 

The administration had until October 14 to file an appeal to the higher court while the tariffs remained in place, but instead chose to rush a request to the Supreme Court and ask for an expedited decision. If the administration is granted an expedited ruling by September 10, the Court could hear oral arguments as early as November. 

In the event that the Supreme Court upholds the federal appeals court’s decision and rules against Trump’s use of IEEPA to impose tariffs, the administration could use a few of the following tariff authorities to reimplement its tariff regime: 

  • Section 122 – Allows the President to implement a 15 percent tariff to address balance-of-payments deficits for 150 days before Congress has to act and approve. 
  • Section 232 or 301 – These authorities are more frequently used and legally tested, but require an investigation to search for and prove either a national security threat or an example of unfair trade practice of a trading partner.
  • Section 338 – Referenced by Treasury Secretary Scott Bessent recently, this option would allow the President to place a 50 percent tariff for five months if a trading partner is found to have acted discriminately or unreasonably, negatively affecting U.S. commerce.

In the balance hang questions of immense importance to the Trump administration: Will the trade deals announced in the last few months be deemed invalid immediately? If struck down and required to repay the billions of dollars collected, how will the administration structure such large-scale rebates or refunds to American firms that bear the brunt of import duties? Will consumers ever be compensated for higher costs due to these tariffs?

In other trade news, the process to begin renegotiating the U.S.-Mexico-Canada Agreement (USMCA) has reportedly begun, with the administration set to request comments from businesses and unions in anticipation of an eventual hearing. The USMCA is a free trade agreement designed to foster trade in North America. Mexico and Canada are the largest trading partners for the U.S. 

Illegal Pocket Rescission Threatens FY26 Progress

Last Friday, the administration announced that it would rescind nearly $5 billion in congressionally appropriated funding for international aid using a contentious budget maneuver called a “pocket rescission.” The rescission targets: 

  • $3.2 billion in USAID development assistance, 
  • $322 million from the USAID-State Department Democracy Fund, 
  • $521 million in State Department contributions to international organizations, and
  • $838 million in peacekeeping aid.

The contents of the package itself have not received much scrutiny, especially from congressional Republicans. However, the deployment of a pocket rescission, a tactic last used by President Jimmy Carter in 1977, is widely regarded as illegal. Although the administration does have the ability to withhold funding for a period of 45 days pending congressional approval under the Impoundment Control Act, a pocket rescission – which is when the President announces a rescission with less than 45 days left in the fiscal year, essentially running out the clock on funding authority – effectively allows the executive to usurp Congress’s power of the purse and enact spending levels of its own choosing. 

Despite the administration’s claims otherwise, a federal judge ruled on Wednesday that the administration’s latest use of a pocket rescission is illegal. The ruling affirmed that the administration must allow congressionally appropriated funding to be spent unless Congress explicitly directs otherwise. The administration quickly appealed the decision, and legal proceedings could continue well into the next fiscal year.

While the pocket rescission makes its way through the courts alongside other impoundments by the Trump administration, the maneuver is only serving to complicate funding negotiations on the Hill ahead of the 2026 fiscal year (FY26) beginning on October 1. 

The announcement of the pocket rescission got a critical reception from some key Republicans, with Appropriations Chair Susan Collins (R-ME) and fellow Senate appropriator Lisa Murkowski (R-AK) calling the move illegal. Senate Majority Leader John Thune (R-SD) even offered a critical comment on the move, stating, “Looking at the composition of the rescissions, I think there are things for the most part that a lot of people would agree with. … But as a matter of process, I think it’s the right thing to have the [appropriators] do their work.”

Democrats have been unified in their criticism of the pocket rescission, slamming it as a blatantly illegal abuse of power. Still, what was initially expected to greatly heighten the chances of a shutdown at the end of this month has not had quite as profound an effect. After the announcement of the pocket rescission, Senate Appropriations Ranking Member Patty Murray (D-WA) stated her openness to a “cromnibus” funding package that would pair three appropriations bills (likely Milcon-VA, Agriculture, and Legislative Branch, which the Senate has passed) with a short-term extension (CR) of funding in other areas. The option is one of several currently being explored by appropriators ahead of the September 30 deadline, though fiscal hawks are pushing for a longer-term CR that would extend into next year. 

Regardless of how Congress proceeds on federal funding, drama and contention surely lie ahead. The House and the Senate are working on appropriations bills with vastly different funding levels, and the administration’s blatant disregard for Congress’s power of the purse constantly looms over the process, further complicating negotiations. While negotiations still seem to be intact following the latest pocket rescission, a lot can happen over the course of the month, and avoiding a government shutdown is far from a certainty. 

Bipartisan Bill to Ban MOC Stock Trading Introduced 

On Wednesday, the Restore Trust in Congress Act – a comprehensive bipartisan bill banning stock trading and ownership by members of Congress – was introduced in the House. The bill is the product of months of negotiations between a bipartisan group of members from across the political spectrum who have led their own bills seeking to ban Congressional trading. 

The bill is led by Representatives Seth Magaziner (D-RI) and Chip Roy (R-TX) and was introduced with 16 original cosponsors (eight Democrats and eight Republicans), including Representatives Pramila Jayapal (D-WA), Tim Burchett (R-TN), Alexandria Ocasio-Cortez (D-NY), Brian Fitzpatrick (R-PA), Raja Krishnamoorthi (D-IL), Anna Paulina Luna (R-FL), Dave Min (D-CA), Scott Perry (R-PA), Joe Neguse (D-CO), Zach Nunn (R-IA), Mike Levin (D-CA), Michael Cloud (R-TX), Josh Riley (D-NY), and Ralph Norman (R-SC).

The bill would:

  • Ban stock trading and ownership by members of Congress and their dependent children.
  • Allows investment in widely held funds and government bonds.
  • Require any covered individual who violates the bill’s restrictions on stock trading or ownership to pay a fee equal to ten percent of the value of the covered investment and disgorge the profits of any prohibited transaction.

20/20 Vision applauds the introduction of this strong legislation, and we encourage every member of Congress to sign on to the bill. We call for a vote on the bill as soon as possible. 

Look Ahead

Tuesday, September 9

Wednesday, September 10

Thursday, September 11

  • August CPI report

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