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We've seen the economy show signs of strengthening since President Trump took office back in January, and since then, the stock market has broken major records, yet the job market seems to be lagging behind. Now the Wall Street Journal is raising questions about a "split-screen economy."
So why is it that investment is rising, and inflation is slowing, but the job market still appears to be stagnant? Richard Stern, director of the Thomas A. Roe Institute for Economic Policy Studies and director of the Grover M. Hermann Center for the Federal Budget at The Heritage Foundation, says these are the lingering effects of Bidenomics.
He explained that, "The job market is still weak because of Biden, but the deregulation and tax cuts under Trump are why there's optimism about future growth." He likened the economy to a large truck, which has been stalled under Biden, but now that Trump is putting the foot back on the gas, it will just need time to get up to speed.
Stern went on to say that, over the next 6–18 months, the American job market will look vastly different. He said, "A lot of businesses have already started making investments through this year. We should start seeing those opportunities maybe a year from now, or a little bit under a year from now."
He also likened the current economic situation to that faced by President Reagan during his first term, when he was tasked with rebuilding the economy after nearly ten years of economic failures in the 1970s, and it took him almost 2 years to see real progress.