U.S. growth near uptrend, but jobs weaken and inflation persists
The U.S. economy is expected to expand near its long-term uptrend as rising business investment offsets weaker consumer spending and slower global trade, according to a new survey by the National Association for Business Economics (NABE).
Economists, however, anticipate slower job creation, higher unemployment, and inflation that remains above the Federal Reserve’s target.
The quarterly NABE survey, released Monday (October 13th, 2025), found that most of the 40 economists polled expect U.S. GDP to grow by 1.8% in 2025, compared with 1.3 % in the June forecast. Inflation, measured by the Fed’s preferred Personal Consumption Expenditures (PCE) index, is projected to end the year at 3%, easing only slightly to 2.5% in 2026. The unemployment rate is seen rising to 4.5% next year, a smaller increase than predicted in the previous survey.
The results mark a modest upgrade to earlier expectations, when concerns about the impact of new tariffs and the risk of a wider trade war had led to more pessimistic outlooks. Still, more than 60% of respondents said the Trump administration’s new import taxes would trim up to half a percentage point from GDP growth. They expect both imports and exports to fall while consumer prices rise as a result of the levies. None of the economists surveyed believes tariffs will benefit growth.
Job growth remains a weak point. Economists expect employment to increase by an average of just 29,000 per month through the end of 2025, with a gradual recovery to around 75,000 per month in 2026. Both figures are below earlier estimates.
Business investment, particularly in computing capacity and artificial intelligence, is projected to be the main driver of growth. The survey found expected investment for 2025 had improved sharply, with capital spending now forecast to rise 3.8% this year compared to 1.6% in the June survey, and 1.7% next year compared to 0.9% previously.
The quarterly NABE survey, released Monday (October 13th, 2025), found that most of the 40 economists polled expect U.S. GDP to grow by 1.8% in 2025, compared with 1.3 % in the June forecast. Inflation, measured by the Fed’s preferred Personal Consumption Expenditures (PCE) index, is projected to end the year at 3%, easing only slightly to 2.5% in 2026. The unemployment rate is seen rising to 4.5% next year, a smaller increase than predicted in the previous survey.
The results mark a modest upgrade to earlier expectations, when concerns about the impact of new tariffs and the risk of a wider trade war had led to more pessimistic outlooks. Still, more than 60% of respondents said the Trump administration’s new import taxes would trim up to half a percentage point from GDP growth. They expect both imports and exports to fall while consumer prices rise as a result of the levies. None of the economists surveyed believes tariffs will benefit growth.
Job growth remains a weak point. Economists expect employment to increase by an average of just 29,000 per month through the end of 2025, with a gradual recovery to around 75,000 per month in 2026. Both figures are below earlier estimates.
Business investment, particularly in computing capacity and artificial intelligence, is projected to be the main driver of growth. The survey found expected investment for 2025 had improved sharply, with capital spending now forecast to rise 3.8% this year compared to 1.6% in the June survey, and 1.7% next year compared to 0.9% previously.
Housing remains a weak spot. Residential investment is projected to contract 1.6% in 2025, compared to a small 0.5 % gain expected earlier, with less than 1% growth forecast for 2026.
Economists also expect the Federal Reserve to cut interest rates once more this year, fewer than the two reductions currently anticipated by markets. The survey noted that GDP growth has recently surprised to the upside, even as hiring and wage gains remain subdued—a trend policymakers are still trying to interpret.
Economists also expect the Federal Reserve to cut interest rates once more this year, fewer than the two reductions currently anticipated by markets. The survey noted that GDP growth has recently surprised to the upside, even as hiring and wage gains remain subdued—a trend policymakers are still trying to interpret.
Author
Sebile Fane cut her teeth in blockchain by building tiny NFT experiments with friends in her living room, long before the buzzwords took hold. She’s driven by a curiosity for the human stories behind smart contracts — whether it’s a small-town artist minting her first token or a DAO voting on climate grants — and weaves technical insight with genuine empathy.
