For most of his presidency, Donald Trump’s grade on the Yahoo Finance Trumponomics Report Card was a respectable B. But in one month it has dropped to C, and it may be heading to D.
Since Trump took office, Yahoo Finance has been grading the Trump economy compared with six prior presidents, using data provided by Moody’s Analytics. We use common metrics such as job gains, earnings and stock values, measuring improvements since Trump took office against prior presidents at the same point in their first term.
The coronavirus outbreak and the business shutdowns it has caused have dramatically eroded Trump’s standing against other presidents. Before the outbreak, Trump ranked first in earnings gains, second in manufacturing employment, and third in total employment. This is where he ranks now:
Here’s a breakdown for each of the six indicators we track:
Total employment. In February, job gains under Trump totaled 6.8 million, third best after Jimmy Carter and Bill Clinton at the same point in their presidencies. But massive job losses during the last two months have wiped out all those gains and more, for a net job loss under Trump of 14.6 million. That’s the worst performance of any of the seven presidents, going back to Carter. The second worst performance was a loss of 12.9 million jobs at the same point in George W. Bush’s presidency, followed by 221,000 job losses under Obama. Both of those presidents began their first terms with a troubled economy. Trump, by contrast, inherited a relatively strong economy.
Manufacturing employment. Manufacturers have shed 881,000 jobs under Trump, which is not as bad as the 2.8 million lost under George W. Bush or the 1.2 million lost under his father, George H. W. Bush. But data during the next two months is almost certain to show many more lost jobs, so Trump could fall another notch or two here.
Average hourly earnings. Trump’s record here is the best, and it will probably stay that way. Wages tend to be “sticky,” even during downturns, since employers are more likely to shrink their workforce than cut pay. Trump’s strength on this measure probably comes from the fact that he took office in the eighth year of an economic expansion, with the labor market tightening, forcing wages up. Overall, wage growth has slowed during the last 30 years, generating weak numbers for most of the seven presidents.
Exports. This has been a weakness for Trump since he began imposing tariffs on China and other importers in 2018, triggering retaliatory measures that have reduced trade overall. Making that worse, U.S. exports typically fall during recessions, since foreigners buy less American-made stuff.
The S&P 500 stock index. Stocks are down 11% this year, but they’ve rebounded from March lows as investors anticipate an economic recovery later this year. Stocks are also benefiting from massive amounts of Federal Reserve monetary stimulus meant to ease liquidity pressures and restore confidence in markets.
GDP per capita. In February, Trump ranked second best on this metric, but with a big falloff in output during March, he has fallen to third worst. GDP numbers for the second quarter are going to be dramatically worse, probably worse than any single quarter during the Great Depression in the 1930s. So Trump is likely to end up with the lowest score in this category by summer.
If Trump notches the lowest marks for manufacturing employment and GDP, and everything else stays the same, his grade will fall to D+, according to our methodology. If the stock market executes another nose dive, Trump’s grade would fall to a straight D. There could also be improvements in some of these metrics, but economists don’t think that’s likely until the third quarter at the very earliest. Many economists don’t expect meaningful improvement in the economy until 2021.
We’ve said all along that presidents deserve less blame (or credit) for what happens to the economy under their watch than they typically get. Many forces presidents can’t control—including microscopic pathogens — determine the course of the economy. But voters hold the president accountable for the economy anyway, with no president since Calvin Coolidge in 1924 winning reelection in the midst or aftermath of a recession. Trump faces steep odds in November, and they’re probably going to get steeper.
Rick Newman is the author of four books, including “Rebounders: How Winners Pivot from Setback to Success.” Follow him on Twitter: @rickjnewman. Confidential tip line: [email protected]. Encrypted communication available. Click here to get Rick’s stories by email.
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