After the pandemic recession, the right policy decisions resulted in a strong recovery and laid the foundations for another era of sustained productivity growth, similar to the 1990s. Sadly, in 2025, new policies are actively working against that dream.
This is our last snapshot of the labor market before we really start seeing the effects of the new Administration’s policies on the economy.
So far, the labor market has taken the slowdown in labor demand in the healthiest way possible. If the labor market slows more than expected, the Fed may not have the luxury of patience anymore.
The 1990s saw an extended period of full employment, high growth, and low inflation. Part of this achievement was attributable to healthcare cost control efforts undertaken by both public- and private-sector actors.
