WASHINGTON, D.C. — President Donald Trump declared what he called "liberation day" on April 2, 2025, and issued an executive order raising import tariffs on nearly every country the United States did business with. The executive order stated: "The decline of US manufacturing capacity threatens the US economy in other ways, including through the loss of manufacturing jobs."

One year after the tariff announcement, several economic indicators pointed to outcomes that diverged from the policy's stated goals. The U.S. manufacturing sector lost 100,000 jobs between January 2025 and March 2026, and the ratio of manufacturing workers to total nonfarm employment fell to its lowest point since 1939, when the Bureau of Labor Statistics began tracking the data. The U.S. goods trade deficit reached an all-time high in 2025, according to the Bureau of Economic Analysis.

"Tariffs failed even by the Trump administration's own terms. They did not shrink the trade deficit, did not revitalise manufacturing and did not help farmers," said Bryan Riley, director of the National Taxpayers Union Foundation's free trade initiative.

U.S. payroll employment growth paused after April 2, 2025, according to Bureau of Labor Statistics data. Payroll employment increased by 181,000 jobs in 2025 after revisions that reduced the estimate by 403,000 jobs. There were 163 million people employed in the U.S. in 2025.

The U.S. and China agreed on May 12, 2025, to defuse a tariff escalation. The Conference Board's consumer confidence index, which had decreased after Trump took office, increased for several months following the May agreement. However, a six-month moving average produced by the Conference Board showed consumer confidence declined across baby boomers, Generation X and younger cohorts over the past year. The University of Michigan's consumer confidence index was near its record low at the end of 2025.

The value of the U.S. dollar declined against other currencies after Trump's inauguration. Investors sold assets denominated in U.S. dollars and bought assets in Europe, Asia and South America. Some major U.S. companies redirected their investments to Europe.

"America is still home to the world's largest economy and its reserve currency, as well as the globe's largest equity and bond markets, but investors continue to reassess their exposure one year on from liberation day," said Russ Mould, investment director at AJ Bell.

International Monetary Fund directors said they were concerned about the heightened domestic and global uncertainties posed by ongoing policy shifts and the war in the Middle East. The IMF directors said there was a need for determined actions to reduce government spending deficits, protect institutions such as the Federal Reserve from political interference, keep inflation in check and prevent financial markets from becoming destabilized.