In November 2025, the U.S. economy found itself at a crossroads, with headline numbers masking a patchwork of hardship, resilience, and uncertainty. While the overall unemployment rate sat at 4.6%, a figure not far from historic lows, the story beneath the surface was far more complicated—especially for Black workers and small businesses feeling the brunt of shifting economic winds.
According to federal labor data reported by multiple outlets, Black unemployment surged to 8.3 percent in November, nearly double the national average and the highest level outside the COVID-19 pandemic. The last time Black unemployment reached similar heights was during the aftermath of the Great Recession, when rates routinely exceeded 8 percent and even peaked above 13 percent between 2009 and 2011. "The unemployment rate rose to the highest since 2021. It's risen considerably more for Black … workers and for teenagers, demographic groups whose unemployment rates tend to be leading indicators of the outlook for the broader job market," noted Bill Adams, chief economist for Comerica Bank, as cited by The Wall Street Journal.
This sharp reversal came on the heels of a period of historic progress. In early 2025, Black unemployment hovered near 6 percent, a testament to the post-pandemic recovery that had seen record lows in 2022 and 2023. Many credited policy initiatives under the Biden-Harris administration for those gains, but the stability unraveled rapidly as President Donald Trump’s expanded tariff regime took hold. By September 2025, the rate had already climbed past 7.5 percent, signaling a troubling trend that would only worsen as the year drew to a close.
The causes of this downturn are multifaceted. In 2025 alone, approximately 300,000 Black women lost their federal government jobs, casualties of sweeping workforce reduction policies enacted by the Trump administration. These weren’t just numbers on a spreadsheet—many of the affected held long-term, stable positions across a range of federal agencies. The public sector, traditionally a bedrock of Black middle-class employment, was hit hard.
Corporate America wasn’t immune from the turbulence either. Major employers—Amazon, UPS, Target, Verizon, Meta, IBM, Paramount, and Nestlé—announced significant job cuts in 2025, citing rising costs and slowing demand. These layoffs reverberated through logistics, retail, media, and technology, sectors where Black workers are often overrepresented. The common thread? Tariffs. Trump’s aggressive trade policies, described by The Wall Street Journal as "willy-nilly," pushed up input costs for manufacturers and retailers. As margins tightened, companies responded with hiring freezes and payroll reductions, leaving Black workers particularly vulnerable.
Economists point out that Black workers have historically been the first to lose jobs during economic slowdowns and the last to recover. The 2008 financial crisis illustrated this pattern, and the current moment is no different. Today’s challenge is compounded by persistent inflation and high interest rates, both of which stifle the growth of small businesses—the very enterprises that often drive employment in Black communities. According to Fortune, small business profitability growth turned negative in November 2025 for the first time in 18 months, slipping to -0.02%. Rising costs from tariffs and inflation forced many small business owners to raise prices at historic rates, with the net percent of owners increasing average selling prices jumping 13 points from October to November, the largest monthly jump since at least March 2023.
Wholesale trade, especially in tariff-exposed durables like electronics and furniture, suffered the steepest declines. Small businesses, which employ nearly half of the U.S. workforce, saw hiring slow dramatically. Payments to hiring firms fell 4.6% year-over-year, and data from payroll providers like ADP confirmed that the weakness was concentrated among small enterprises. Despite the holiday shopping season and the critical boost from Small Business Saturday—an event that can generate up to 20% of annual sales—consumer momentum appeared to wane, casting doubt on hopes for a late-year rebound.
President Trump remained optimistic, promising during his 2024 campaign that "the markets are going to boom, the stock [market] is going to boom, the country is going to boom." Yet, as The Wall Street Journal reported, most of these promises have fallen flat. The U.S. economy hasn’t collapsed, but neither has it experienced the revival Trump forecasted. The odds of a recession in the coming year have actually dropped below 25%, but the pain is real for those on the front lines.
Manufacturing, a sector Trump pledged to revive, has contracted for nine consecutive months. The Institute for Supply Management’s purchasing managers index for manufacturing stood at 48.2 in November, below the 50 mark that signals expansion. Since the tariffs began, manufacturing has shed about 54,000 jobs. The story of Kent International, a bicycle importer and manufacturer in South Carolina, is emblematic: high tariffs on Chinese-made components forced the closure of its U.S. factory and the loss of 64 jobs. Owner Arnold Kamler summed up the predicament: “After the April reciprocal tariffs, we were done.”
Tariffs have also hit American wallets. Major retailers, from Macy’s to Best Buy, raised prices to offset higher costs. Walmart CFO John David Rainey told The Wall Street Journal in May, “The magnitude and speed at which these prices are coming to us is somewhat unprecedented in history.” Inflation has hovered around 3%—higher than the Federal Reserve’s 2% target, but lower than many economists predicted. Tariffs have touched a narrow band of consumer prices, but the uncertainty surrounding Trump’s shifting policies has left many companies waiting to see where things will settle before making further adjustments.
On the revenue side, tariffs have delivered for federal coffers. Between April and September, the government collected an average of $25 billion a month in customs duties, more than double the previous year’s haul. Yet, this windfall falls far short of replacing the income tax, as Trump once boldly claimed. The future of these collections hangs in the balance, with a Supreme Court decision on Trump’s authority to impose tariffs expected soon. If the court strikes down tariffs imposed under the International Emergency Economic Powers Act, much of this revenue could vanish—and some might even need to be refunded.
Despite these headwinds, there are glimmers of hope. Optimism among small business owners about 2026 is rising, and hiring plans for early next year are at their highest point of 2025. Many are betting on technology to restore efficiency: half of small business owners plan to implement artificial intelligence within five years, and spending on tech services rose 6.2% in November. The AI investment boom has, in fact, helped buoy GDP growth, which reached a 3.8% annualized rate in the second quarter and tracked close behind in the third, according to Fortune and The Wall Street Journal.
Yet, the labor market remains divided. Black workers face longer bouts of unemployment—averaging over 20 weeks, compared to about 10 weeks for white workers. Automation and AI adoption, while promising for some, are accelerating job losses in front-line service and clerical roles, widening the skills gap and making recovery more difficult for those already at risk.
As policymakers look toward 2026, the stakes are clear. Without intervention or a pivot in labor policy, the progress of the last decade could be undone. The data, as economists warn, demands accountability—not excuses. Whether this is a temporary setback or the start of a deeper structural recession remains to be seen, but for many Americans, the consequences are already painfully real.
