Economy

Businesses that rely on immigrants are pushing for legislation to ensure an adequate, legal flow of laborers from abroad as deportations ramp up.In recent weeks, managers of the nation’s resorts, plant nurseries, fish processors and racetracks started getting very worried.The Trump administration had yet to release a batch of H-2B visas — those available for seasonal businesses that often can’t find enough workers domestically to fulfill demand.Usually, the Department of Homeland Security releases them a few days after receiving more applications than the number of visas allowed for the second half of the year. That cap was reached on March 5, but no announcement came. Industry lobbyists got members of Congress to reach out on their behalf, put on a fund-raiser at Mar-a-Lago and sent a letter urging the administration to continue issuing the visas.“It needs to be done by April 1, otherwise we all get backed up,” said Greg Chiecko, the president of the Outdoor Amusement Business Association, which represents traveling carnival producers. “We’ve heard that they’re going to, but they’re being very deliberate in waiting a little bit.”Finally, last Wednesday, a news release announced that the visas would continue to flow, allowing businesses that banked on having them for the summer to move forward with their plans.But the anxiety reflected a deep uncertainty about where President Trump is headed on legal immigration programs, both temporary and permanent, as the administration ramps up deportations and moves to end the legal status of millions who arrived in recent years. Those actions will squeeze the labor supply that many employers depend on — and they’re using the crackdown to argue for broader channels for people to come and work.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

Goldman Sachs expects aggressive duties from the White House to raise inflation and unemployment and drag economic growth to a near-standstill.
In a note Sunday, the firm said “we continue to believe the risk from April 2 tariffs is greater than many market participants have previously assumed.”
The firm raised its forecast for inflation this year to 3.5%, cut its GDP outlook to just 1% and raised its unemployment view to 4.5%.

U.S. President Donald Trump announces that his administration has reached a deal with elite law firm Skadden, Arps, Slate, Meagher & Flom during a swearing-in ceremony in the Oval Office at the White House on March 28, 2025 in Washington, DC. 
Andrew Harnik | Getty Images

With decision day looming this week for President Donald Trump’s latest round of tariffs, Goldman Sachs expects aggressive duties from the White House to raise inflation and unemployment and drag economic growth to a near-standstill.
The investment bank now expects that tariff rates will jump 15 percentage points, its previous “risk-case” scenario that now appears more likely when Trump announces reciprocal tariffs on Wednesday. However, Goldman did note that product and country exclusions eventually will pull that increase down to 9 percentage points.

When the new trade moves are enacted, the Goldman economic team led by head of global investment research Jan Hatzius sees a broad, negative impact on the economy.
In a note published on Sunday, the firm said “we continue to believe the risk from April 2 tariffs is greater than many market participants have previously assumed.”
Inflation above goal
On inflation, the firm sees its preferred core measure, excluding food and energy prices, hitting 3.5% in 2025, a 0.5 percentage point increase from the prior forecast and well above the Federal Reserve’s 2% goal.
That in turn will come with weak economic growth: Just a 0.2% annualized growth rate in the first quarter and 1% for the full year when measured from the fourth quarter of 2024 to Q4 of 2025, down 0.5 percentage point from the prior forecast. In addition, the Wall Street firm now sees unemployment reaching 4.5%, a 0.3 percentage point raise from the previous forecast.
Taken together, Goldman now expects a 35% chance of recession in the next 12 months, up from 20% in the prior outlook.

The forecast paints a growing chance of a stagflation economy, with low growth and high inflation. The last time the U.S. saw stagflation was in the late 1970s and early ’80s. Back then, the Paul Volcker-led Fed dramatically raised interest rates, sending the economy into recession as the central bank chose fighting inflation over supporting economic growth.
Three rate cuts
Goldman’s economists do not see that being the case this time. In fact, the firm now expects the Fed to cut its benchmark rate three times this year, assuming quarter percentage point increments, up from a previous projection of two rate cuts.
“We have pulled the lone 2026 cut in our Fed forecast forward into 2025 and now expect three consecutive cuts this year in July, September, and November, which would leave our terminal rate forecast unchanged at 3.5%-3.75%,” the Goldman economists said, referring to the fed funds rate, down from 4.25% to 4.50% today.
Though the extent of the latest tariffs is still not known, the Wall Street Journal reported Sunday that Trump is pushing his team toward more aggressive levies that could mean an across-the-board hit of 20% to U.S. trading partners.
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The American conservative movement has long worked to put the nuclear family at the center of cultural and economic life. Lately, it has added a twist. It wants to make those families bigger.As fertility rates have declined, a “pronatalist” cluster on the right wing has been making the argument that public policy should encourage more childbearing. With President Trump’s return to office, this group appears to have gotten closer to the center of power than ever before.Broadly speaking, they want measures like more support for families with several children; speedier and cheaper options for higher education that would allow Americans to start procreating earlier; help for those having trouble conceiving; and initiatives that elevate childbearing to a national service.Steps like the move by Transportation Secretary Sean Duffy, a father of nine, to direct federal funds toward places with high marriage rates and birthrates are exactly what many have in mind.Movement on their priorities, however, has been slow. And in some cases, pronatalists have found the White House’s actions counterproductive.“So much has happened, and so much has been such a mixed bag,” said Patrick Brown, a fellow at the conservative Ethics and Public Policy Center who is focused on family policy. “That’s going to be the tension, that angel on one shoulder and the devil on the other. At this stage, the devil seems to be winning out.”Fertility Rates Are Falling Across the WorldBut faster in some countries than in others.

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The average number of children born to a woman in select countries and regions
E.U. refers to European Union countries, even before the bloc was formed.Source: The World BankBy The New York TimesWe are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

“Prices are going to shoot up now,” one shopper said. But some dealers said that economic concerns might be keeping people away.Ziggy Duchnowski spent Saturday morning car shopping along Northern Boulevard in Queens with two goals in mind.He wanted to find a new small car for his wife, and he hoped to strike a deal before the new tariffs that President Trump is imposing on imported cars and trucks affect prices.“The word on the street is prices are going to shoot up now,” said Mr. Duchnowski, 45, a union carpenter who voted for Mr. Trump, holding the hands of his two small children.The tariffs — 25 percent on vehicles and parts produced outside the United States — will have a broad impact on the North American auto industry. They are supposed to go into effect on April 3 and are sure to raise the prices of new cars and trucks.They will also force automakers to adjust their North American manufacturing operations and scramble to find ways to cut costs to offset the tariffs. And for now at least, they are spurring some consumers to buy vehicles before sticker prices jump.Analysts estimate that the tariffs will significantly increase the prices of new vehicles, adding a few thousand dollars for entry-level models to $10,000 or more for high-end cars and trucks. Higher prices for new vehicles are also likely to nudge used-car prices higher.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

The move added to the list of actions by President Trump that use the powers of his office to weaken perceived enemies.Federal worker unions have sought over the past two months to lead the resistance to President Trump and his Department of Government Efficiency, filing lawsuits, organizing protests and signing up new members by the thousands.This week, Mr. Trump struck back with a potentially crippling blow.In a sweeping executive order denouncing the unions as “hostile” to his agenda, the president cited national security concerns to remove some one million civil servants across more than a dozen agencies from the reach of organized labor, eliminating the unions’ power to represent those workers at the bargaining table or in court.A lawsuit accompanying the executive order, filed by the administration in federal court in Texas, asks a judge to give the president permission to rescind collective bargaining agreements, citing national security interests and saying the agreements had “hamstrung” executive authority.Labor leaders vowed on Friday to challenge the Trump actions in court. But, barring a legal intervention, the moves could kneecap federal unions and protections for many civil service employees just as workers brace for a new round of job cuts across the government.“They are hobbling the union, ripping up collective bargaining agreements, and then they will come for the workers,” said Brian Kelly, a Michigan-based employee of the Environmental Protection Agency who heads a local of the American Federation of Government Employees, the country’s largest federal employee union. “So, it’s a worst-case scenario.”The move added to the list of actions by Mr. Trump to use the levers of the presidency to weaken perceived enemies, in this case seeking to neutralize groups that represent civil servants who make up the “deep state” he is trying to dismantle. In issuing the order, Mr. Trump said he was using congressionally granted powers to designate certain sectors of the federal work force central to “national security missions,” and exempt from collective-bargaining requirements. Employees of some agencies, like the F.B.I. and the C.I.A., are already excluded from collective bargaining for these reasons.Are you a federal worker? We want to hear from you.The Times would like to hear about your experience as a federal worker under the second Trump administration. We may reach out about your submission, but we will not publish any part of your response without contacting you first.

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Donald Trump has spent his first months in the White House railing against the US’s largest trading partners, accusing them of cheating America and taking advantage of the world’s largest economy.“For DECADES we have been ripped off and abused by every nation in the World, both friend and foe. Now it is finally time for the Good Ol’ USA to get some of that MONEY, and RESPECT, BACK. GOD BLESS AMERICA!!!” the president wrote on social media this month. Trump has declared that April 2 will be “Liberation Day”, when he plans a sweeping escalation of his trade policy, potentially hitting the US’s largest trading partners with steep tariffs as he upends decades of global trading norms. What will Trump do on “Liberation Day”? There are three main elements — and a lot of uncertainty.Firstly, the reports will land. On inauguration day, Trump followed up his election campaign pledges for immediate tariffs on all US imports by ordering a series of investigations into the country’s trading relationships. These studies will be returned to him on April 1.The second element is the centrepiece on April 2: the expected announcement of so-called reciprocal tariffs. These are supposed to counter what his administration views as unbalanced trade relationships and unfair taxes, subsidies and regulations.In parallel, the White House is looking at a whole host of sectoral levies to unveil on that date. Trump somewhat jumped the gun on Wednesday by setting out 25 per cent tariffs on cars.The president has said other tariffs may follow on chips and pharmaceuticals, but has also signalled that those would be announced at a later date. It has all added to the unpredictability that has been a hallmark of his leadership.April 2 is also the day Trump has suggested tariffs of 25 per cent on all imports from Canada and Mexico will reapply. Earlier this month, he offered a temporary exemption from those levies to goods complying with the terms of the 2020 trade deal between the three countries.Some content could not load. Check your internet connection or browser settings.What does Trump mean by a reciprocal tariff?The Trump administration has said it wants to impose tariffs on a “country by country” basis, hitting any trading partners that have higher levies on the US than it imposes back.What makes this more novel is the US saying it will also retaliate against trading partners with so-called non-tariff trade barriers, such as rules, regulations, subsidies or taxes.US officials have repeatedly singled out the EU’s value added tax as an example of an unfair trade practice. Digital services taxes are also under attack from Trump officials who say they discriminate against US companies. Trade experts say it is notoriously difficult and time-consuming to calculate a specific tariff rate to counter another country’s taxes or regulations.Lori Wallach, director of the think-tank Rethink Trade, said the US balancing trade with its partners “could mean some logical combination of sectoral tariffs applying to all countries for particular goods the US thinks are important, and some application of country-specific tariffs on countries that have the highest chronic surpluses in their global trade”.Some content could not load. Check your internet connection or browser settings.How will the measures be applied? If Trump were to apply immediate tariffs to trading partners on Wednesday, he would need to use emergency powers, instead of the trade measures he has relied on previously to impose levies following months of investigation. These measures could include the US’s International Emergency Economic Powers Act, or a little-known trade law, Section 338 of the Tariff Act of 1930, to potentially apply tariffs of up to 50 per cent.Trade lawyers say tariffs applied under emergency powers could kick in immediately. “If he does it under IEEPA, I think our experience from the Mexico and Canada and China tariffs says it could happen almost instantaneously,” said Lynn Fischer Fox, a partner at Arnold & Porter and former US trade official. What tariffs has Trump already imposed?Trump has already imposed additional tariffs on all imports from China of 20 per cent, and levies of 25 per cent on all US imports of steel and aluminium — plus a large list of products made with those metals.Earlier this month, he initially imposed tariffs of 25 per cent on all imports from Mexico and Canada in what he said was a drive to force them to reduce illegal immigration across their borders and stem the flow of the deadly opioid fentanyl.Hours later, the president softened the tariffs by offering a temporary exemption for goods that comply with the terms of the 2020 North American trade deal between the three countries.On March 24 Trump also signed an executive order issuing unprecedented “secondary tariffs” on all countries that buy any oil and gas from Venezuela, taking effect on April 2. Those tariffs will apply for one year after a country’s most recent purchase of fuel from Venezuela, unless senior US officials waive them earlier than that. Most trade experts expect the various tariffs placed on US trading partners to be cumulative. For example, China would potentially face the 20 per cent tariff on all imports, in addition to a 25 per cent levy in response to its purchases of Venezuelan oil, to give its imports an overall 45 per cent duty. The reciprocal tariff could be added on top. Trump has opened trade investigations that could use national security grounds to apply tariffs to copper and lumber. The so-called Section 232 investigations were successfully used to apply levies to steel and aluminium by Trump in 2018, and recently again on cars this month. How might affected countries respond?Under the last Trump administration, US trading partners retaliated with their own levies on US goods, escalating a trade war.Typically the targets are goods that are important to Republican lawmakers, who might then think twice about the president’s aggressive trade policy. This time around, some US trading partners are following the same playbook. The EU has said it would counter US steel and aluminium tariffs with its own duties affecting up to $28bn of assorted American goods. If approved by EU member states, these are set to take effect on April 12.China has also put tariffs on $22bn of US agricultural exports, targeting Trump’s rural base with new duties of 10 per cent on soyabeans, pork, beef and seafood. Cotton, chicken and corn face additional 15 per cent levies.  Canada applied tariffs to about $21bn of US goods ranging from alcohol to peanut butter in early March. That was followed by another tranche of around $21bn on US steel and aluminium products among other items. Several countries — including Mexico and the UK — have so far not responded. The UK has opted to try to negotiate a trade deal rather than inflaming relations with the president.Stephen Moore, visiting fellow in economics at the rightwing Heritage Foundation, said retaliating against the US was “exactly the wrong response” from its trading partners. “It’s so counter-productive, and all that’s doing is further agitating Trump,” Moore said.Which countries are most at risk?The extent of the reciprocal tariffs remains unclear. Last month, US officials indicated that Japan, India, the EU and Brazil would be the biggest targets.However, when asking American exporters to file complaints about their trading partners, the US Trade Representative’s office said it was interested in all G20 countries, plus countries that have “the largest trade deficits in goods with the United States”. Its list included Argentina, Australia, Brazil, Canada, China, the EU, India, Indonesia, Japan, Korea, Malaysia, Mexico, Russia, Saudi Arabia, South Africa, Switzerland, Taiwan, Thailand, Turkey, the UK and Vietnam.Some content could not load. Check your internet connection or browser settings.Will it be inflationary? Federal Reserve officials are on guard for signs that the tariffs will trigger broad and persistent inflationary pressures.Previous rounds of trade levies, imposed during Trump’s first term, did not have a persistent impact on prices, but rate-setters are acutely aware that this time may be different.Not only are the current round of tariffs potentially much more disruptive, they also come at a time when businesses and households are still struggling to recover from the worst bout of US inflation since the 1980s.Additional reporting by Claire Jones in London; data visualisation by Alan Smith and Ray Douglas More

Earlier this month, more than 100 Pizza Hut delivery drivers for Scotland’s biggest takeaway franchisee were called to an emergency meeting and offered an unwelcome choice. Managers of the Glenshire Group, which runs delivery outlets across Scotland, told workers they had a choice: take an effective pay cut, move to an in-store role or switch into self-employment. The changes, bosses said, were needed to cope with increases to national insurance contributions (NICs) and minimum wage rates that take effect this week — sharply raising labour costs for employers of low-wage workers.Bryan Simpson, lead organiser for hospitality at the union Unite, who relayed the details of the Glenshire exchange, said the changes set a “dangerous precedent” in a sector where many employers were moving workers to shorter or zero-hour contracts to cut costs.  “This is not a small business — it’s the largest franchisee in all fast food [in Scotland] moving to a self-employed model,” he said. “That really worries me for the message it could send to the rest of the sector.” Glenshire said it had not changed workers’ contractual terms and was “engaging directly with our colleagues to understand their concerns”. But the row reflects the pressures employers across the UK are dealing with against a backdrop of weak growth and consumer spending. The Unite union protests outside a Pizza Hut store in Leith More

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.The problem for European investors in disentangling themselves from the US is that, deliberately or otherwise, they are in deep. Portfolios everywhere, retail and institutional, are stuffed to the gills with US stocks.This can lead you to one of two conclusions: First, that the outperformance in European stocks now under way is fun but ultimately a blip, and therefore the great disentanglement won’t happen. Or second, that we are at the start of a long and painful process for the US. I lean heavily towards the latter.By now we all know the score: The widespread, almost universal belief among institutional investors that the US would dominate global stocks in 2025 has proven to be badly misplaced. The pro-growth, low-tax, anti-red-tape narrative of Donald Trump’s second presidency has collapsed under its own weight and given way to fears of a recession or stagflation. On-again-off-again trade tariffs and widespread federal jobs cuts are gnawing away at corporate and consumer confidence. And the depth of the administration’s loathing for supposed allies in Europe has shocked investors there deeply. Fund managers at global investment houses recognise that vice-president JD Vance’s speech in Munich was problematic, but European investors were offended in a way that Americans perhaps have not recognised.Markets are reacting as you might expect. The dollar is sliding, and European markets are streaking ahead of the US. It’s important to understand just how unusual this is. Germany’s Dax stocks index has outperformed the US S&P 500 in just two of the past 12 years. Analysts at Deutsche Bank point out that at the current pace — and yes, it is still early in the year — this is shaping up to be the best year for outperformance in the Dax in any year since 1960. Similarly, the dollar’s woes are for the history books. It has fallen further by this point in the year only six times since 1969.Some content could not load. Check your internet connection or browser settings.Barclays is among those warning against getting overexcited. The rush of money in to Europe-focused funds is substantial, its analysts say, but it will struggle to keep running at this pace. Similarly, Germany’s announcement of fiscal stimulus does point to higher European growth, but Trump’s trade tariffs are likely to pull in the opposite direction — a “tug of war” that means “reports of the end of US exceptionalism may well prove greatly exaggerated”.What we do know is that European exceptionalism is still a very young investment theme, and US dominance is hard-baked in to the financial system. Data from the US Federal Reserve shows that European investors held about $9tn in US stocks at the end of last year — around 17 per cent of the overall value of the US market and not far off the market capitalisation of all the equities in Europe.Some content could not load. Check your internet connection or browser settings.This gigantic overallocation to the US has not happened by magic. It has just made financial sense over the long term. Paul Marsh of the London Business School, one of the authors of UBS’s Investment Returns Yearbook — a sacred text for markets nerds — points out that one dollar invested in the US at the start of 1900 was worth $899 by the end of the century in real terms. The same dollar invested in the rest of the world was worth just $119.The first quarter of the 21st century shows a similar gap. A dollar invested in the US at the start of 2000 was worth $3.28 by the end of 2024, again, after inflation. For the rest of the world, you end up at a rather humdrum $1.63. As a rule, non-US investors who have failed to make a significant allocation to the US have not been doing their jobs properly.The US has been hard to avoid, in fact. By the end of last year, 10 stocks made up nearly a quarter of the global total of market capitalisation in public equities. Nine of them are from the US. The US makes up 64 per cent of the value of all global stocks, or nearly 73 per cent of developed markets. Any investor tracking a global stocks index such as the MSCI Global may think this is a neutral strategy — a nice, easy way to achieve diversification. It’s not — it’s a nice, easy way to run a massive positive bet on the US. “We have argued over time that the merits of the US must be fully discounted,” Marsh said at the launch of his latest yearbook earlier this month. “It’s not that the US will stop being a dominant market or the US will stop being a hugely entrepreneurial country. It’s just that all has to be in the price at some point.”Investors everywhere are hugely overexposed to the US. That was uncomfortable enough before Trump began his second presidency, and it feels rather more reckless now. It is hard for global investors to shake off more than a century of evidence that buying US assets is simply in the best financial interests of themselves or their clients, but lighter allocations to Trump’s America represent basic risk management at this point.Trillions of investment dollars can leave the US if the rest of the world chooses to get back towards a neutral position. The question is how easily the rest of the world’s markets can absorb that money. As Trump said in a social media post outlining one of his many sets of trade tariffs: “Have fun!”[email protected] More