The Bureau of Labor Statistics January jobs report blew out consensus expectations, reporting a net 130,000 jobs were created last month, more than double the 55,000 predicted by most “experts.” Unemployment also edged down to 4.3% and wages grew 3.7%, outpacing inflation. While the top-line monthly numbers were impressive, the even more pleasing real story can be found in the report’s annual benchmark numbers, which show that in President Donald Trump’s economy, people are winning and government bureaucrats are losing.
Overall, fewer than a million jobs were created during the first year of Trump’s first term, which at first compares unfavorably with the more than 2.5 million jobs created during former President Joe Biden’s last year in office. But under Biden, almost all those new jobs, 1.9 million went to foreign-born workers. But under Trump, for the first time since the 1960s, the foreign-born population has fallen, and so has the number of jobs held by foreign-born residents.
The number of foreign-born residents of the United States over the age of 16 fell by more than 700,000 in 2025, while the number of jobs held by foreign-born residents fell by almost 100,000. Meanwhile, job growth among people born in the U.S. increased from just over 750,000 under Biden to almost 850,000 under Trump. If you are a native born worker, the Trump economy is indisputably better than that of Biden.
The reversal of Biden’s illegal mass migration is not the only factor that undersells the top-line job numbers. Whereas Biden continually expanded the size and scope of the federal government throughout his presidency, under Trump, the federal government shed 324,000 jobs during just its first year. This means productive private-sector job growth has been much stronger under Trump than it was under Biden.
Other encouraging signs from the January report include 33,000 new jobs in the construction industry, 34,000 jobs in professional and business services, and even a modest 5,000 gain in manufacturing, which is a big improvement after years of job declines. With wages rising and the number of undocumented immigrants falling, the public is responding by reentering the workforce. The labor force participation rate for people in their prime working years, ages 25 and 54,, jumped to 84.1% in January, the highest it has been since 2001.
That surge in participation did not happen by accident. It reflects policy changes that are reshaping incentives throughout the economy.
First, by extending and expanding pro-growth elements of the 2017 tax reforms, especially full expensing for business investment and lower marginal rates, the Trump administration has made it more attractive to start businesses, expand payrolls, and raise wages. When firms can keep more of what they earn, they invest more in equipment, facilities, and workers. January’s wage gains suggest employers are competing harder for labor, which is what happens when capital investment rises.
Second, deregulation, particularly in energy, is reducing costs across the economy. Pipeline approvals, expanded oil and gas leasing, and fewer permitting delays have helped push energy production higher. Energy is a core input for nearly everything people buy, from food to building materials. Lower energy costs make public manufacturing more competitive, reduce household utility bills, and free up income for other spending. Gains in construction and stabilization in manufacturing reflect an economy in which input costs are becoming more manageable.
Third, stronger immigration enforcement has tightened the labor market in ways that benefit U.S.-born workers. For years, large inflows of illegal labor have put downward pressure on wages in many job sectors. By reducing the labor supply, the administration has shifted bargaining power back toward lawful workers, encouraging higher pay and drawing more of the public into the workforce.
These policies help explain why native-born employment gains accelerated even as overall job growth appeared modest. The composition of growth matters more than the headline number.
RENTS FALL AS DEPORTATIONS RISE
But one policy that works against these gains is tariffs. Even when implemented in an organized and impartial manner, tariffs are still taxes that raise costs for businesses and consumers. When wielded haphazardly on the whim of one man, as they are by Trump, they become an engine of uncertainty that works against business planning and investment.
Trump’s economy is beginning to look good but it would be better without his unilateral and unconstitutional tariff regime, a problem the Supreme Court will, we hope, soon remedy.