Last year's odd economy and what to watch for in 2026

In 2025 the U.S. recorded solid GDP growth even as hiring slowed and unemployment rose, and a six-week government shutdown disrupted economic data collection.

The U.S. economy in 2025 displayed several contradictions. Growth was healthy while hiring slowed, inflation stayed elevated and unemployment rose. The article notes that advances in technology, especially artificial intelligence, could allow firms to increase output without adding workers, raising the prospect of a "jobless expansion." A six‑week government shutdown last fall disrupted the collection and publication of economic data, leaving policymakers with a cloudier view. Key observations: - Growth accelerated to a 4.3% annual pace in the July–September quarter, supported by solid consumer spending. - Hiring slowed during the year while unemployment rose and inflation remained elevated. - A six‑week government shutdown delayed data collection and publication, complicating assessments for the Federal Reserve. - Wealthier households accounted for a rising share of spending, which can mask weaknesses among lower‑income families. Summary: The mix of strong GDP readings and weak labor signals makes it harder to judge underlying economic health. Undetermined at this time.